Ratings agency Moody’s has downgraded Coinbase’s (COIN) corporate debt and also placed its debt ratings for the crypto exchange under review for further downgrade.
- Coinbase's corporate family rating debt was downgraded by Moody's to Ba3 from Ba2, while its guaranteed senior unsecured notes was dropped to Ba2 from Ba1. According to Moody's, Coinbase had $2 billion in senior guaranteed notes due in 2028 and 2031. Moody's didn't indicate how much corporate family rating debt Coinbase had.
- Moody’s said the downgrade reflects “Coinbase's substantially weaker revenue and cash flow generation due to the steep declines in crypto asset prices that have occurred in recent months and reduced customer trading activity.”
- Moody’s said it expects Coinbase’s profitability to remain challenged despite announcing the layoffs of around 1,100 employees on June 14.
- According to Moody's, as of March 31, Coinbase had $6.1 billion in cash and cash equivalents, which it called "a healthy position" relative to the company's $3.4 billion in long-term debt, which includes the $2 billion in senior guaranteed notes.
- Coinbase's shares were down 0.3% to $58.88 after hours on Thursday after rising 13% during the day. The stock is down almost 77% year to date.
UPDATE (June 23, 21:08 UTC): Added details of Moody's debt rating moves.
UPDATE (June 23, 21:18 UTC): Added the amount of Coinbase's senior guaranteed debt.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is an award-winning media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. In November 2023, CoinDesk was acquired by Bullish group, owner of Bullish, a regulated, institutional digital assets exchange. Bullish group is majority owned by Block.one; both groups have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary, and an editorial committee, chaired by a former editor-in-chief of The Wall Street Journal, is being formed to support journalistic integrity.