Thursday, July 10, 2025
  • Login
Euro Times
No Result
View All Result
  • Home
  • Finance
  • Business
  • World
  • Politics
  • Markets
  • Stock Market
  • Cryptocurrency
  • Investing
  • Health
  • Technology
  • Home
  • Finance
  • Business
  • World
  • Politics
  • Markets
  • Stock Market
  • Cryptocurrency
  • Investing
  • Health
  • Technology
Euro Times
No Result
View All Result

Coinbase, MicroStrategy Bonds Drop To Record Lows on FTX Bankruptcy By DailyCoin

by DailyCoin
November 22, 2022
in Cryptocurrency
Reading Time: 2 mins read
A A
0
Home Cryptocurrency
Share on FacebookShare on Twitter


Coinbase, MicroStrategy Bonds Drop To Record Lows on FTX Bankruptcy
  • Coinbase (NASDAQ:) bonds are at historic lows, trading at 51 cents, MicroStrategy at 75 cents on the dollar;
  • Coinbase and MicroStrategy bond yields carry a premium of about 1,000 basis points to 10-year Treasuries;
  • FTX’s collapse is likely responsible for shaking institutional confidence in the industry.

Bonds issued by crypto exchange Coinbase and business intelligence MicroStrategy dropped to historic lows as higher interest rates and low institutional confidence rock the crypto industry.

Coinbase, one of the leading US-based cryptocurrency exchanges, saw its bond due 2031 drop 15% in November. The bond is now trading at around 50.5 cents on the dollar, indicating that investors believe there’s a high likelihood of default. The yield, which moves opposite to bond prices, jumped to 13.5%. The yield on Coinbase’s bond due 2026 jumped even higher to 17%.

Bonds issued by MicroStrategy, a business intelligence company owned by maximalist Michael Saylor, have taken a hit as well. The price of its 2028 notes dropped to a record low of 72.5 cents on the dollar, and yields climbed to 13.35%.

MicroStrategy originally issued these bonds to fund its investment in Bitcoin. Currently, the company holds about 130,000 bitcoins, the equivalent of about $2.1 billion. Last quarter, the company lost about $3.4 billion due to a drop in the price of BTC.

Rate Hikes, FTX Collapse Push Bonds Up

Federal Reserve rate hikes have taken a toll on high-growth, risk assets such as tech and crypto. Higher interest rates push bond yields up across the board, making investors less likely to pursue high returns in speculative ventures.

However, Coinbase and MicroStrategy bond rates are disproportionally high and can’t be explained by interest rates alone. The bonds of the two companies currently carry a premium of about 1,000 basis points to Treasury notes. are currently 3.78%.

The high premiums (and low bond prices) are likely influenced by the drop in institutional confidence in crypto. The FTX collapse was a major blow to institutional crypto adoption, as saw many institutions cut their exposure to digital assets.

Bonds trade lower when investors believe that there’s a high chance that the issuing party won’t be able to make the payment. This could happen because of expected liquidity issues, or if investors believe that the issuing party is likely to go bankrupt.

Markets seem to believe that we have not seen the end of the FTX contagion.

On the Flipside

  • Despite the current market sentiment, many investors believe that crypto has large upside potential in the long run.

Why You Should Care

High discounts on crypto bonds could indicate that the crypto market is about to experience more pain.

Find out why institutions are fleeing crypto:

Institutional Investors Forgo Digital Assets Following FTX Crash

Learn about how the collapse of FTX could tank the crypto industry:

Will FTX’s Blowup be the Final Straw for Crypto?

See original on DailyCoin



Source link

Tags: bankruptcybondsCoinbaseDailyCoindropFTXLowsMicroStrategyrecord
Previous Post

Glenmark, Pfizer ink settlement on kidney cancer drug Axitinib

Next Post

House sales held steady last month but experts warn of ‘looming storm’

Related Posts

Breakout Above ,800 Could Ignite Altseason

Breakout Above $2,800 Could Ignite Altseason

by Sebastian Villafuerte
July 10, 2025
0

Ethereum surged over 5% yesterday, pushing previous the important thing $2,700 stage and signaling renewed energy throughout the altcoin market....

Trump Administration Imposes 50% Tariff on Brazilian Imports

Trump Administration Imposes 50% Tariff on Brazilian Imports

by Sergio Goschenko
July 10, 2025
0

Trump famous that the brand new 50% tariff on Brazilian imports was justified as a result of unfair remedy of...

NFT Sales Hit .82B in H1 2025 as Market Cools

NFT Sales Hit $2.82B in H1 2025 as Market Cools

by Cointelegraph By Ezra Reguerra
July 10, 2025
0

World non-fungible token gross sales volumes reached $2.82 billion within the first half of 2025, exhibiting a small lower of...

Tether Moves 80 Tons Of Gold Offshore

Tether Moves 80 Tons Of Gold Offshore

by Christian Encila
July 10, 2025
0

Trusted Editorial content material, reviewed by main trade consultants and seasoned editors. Advert Disclosure Tether, the corporate behind the USDT...

VC Firm Ego Death Capital Closes 0M Fund to Back Bitcoin-Based Projects

VC Firm Ego Death Capital Closes $100M Fund to Back Bitcoin-Based Projects

by Sneha Agrawal
July 10, 2025
0

Ego Demise:- In an enormous enhance for the growing Bitcoin DeFi, the VC agency Ego demise capital has raised $100M...

Ben ‘BitBoy’ Armstrong faces six charges for harassing phone calls, released after arrest

Ben ‘BitBoy’ Armstrong faces six charges for harassing phone calls, released after arrest

by Vivian Nguyen
July 10, 2025
0

Key Takeaways Ben 'BitBoy' Armstrong has been booked on six counts of harassing telephone calls in Cherokee County, Georgia. The...

Next Post
House sales held steady last month but experts warn of ‘looming storm’

House sales held steady last month but experts warn of ‘looming storm’

Indonesia quake toll jumps to 268, rescuers hunt for survivors

Indonesia quake toll jumps to 268, rescuers hunt for survivors

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Pentagon to become largest shareholder in rare earth magnet maker MP Materials

Pentagon to become largest shareholder in rare earth magnet maker MP Materials

July 10, 2025
Saratoga Investment Q1: ROE Beating The BDC Industry Average (NYSE:SAR)

Saratoga Investment Q1: ROE Beating The BDC Industry Average (NYSE:SAR)

July 10, 2025
The Emptiness of AI Ethics

The Emptiness of AI Ethics

July 10, 2025
Sony Xperia 1 VII units in more regions are dying, but there’s a temporary solution

Sony Xperia 1 VII units in more regions are dying, but there’s a temporary solution

July 10, 2025
EU will soon collapse without Russian resources – MEP — RT World News

EU will soon collapse without Russian resources – MEP — RT World News

July 10, 2025
Breakout Above ,800 Could Ignite Altseason

Breakout Above $2,800 Could Ignite Altseason

July 10, 2025
Euro Times

Get the latest news and follow the coverage of Business & Financial News, Stock Market Updates, Analysis, and more from the trusted sources.

CATEGORIES

  • Business
  • Cryptocurrency
  • Finance
  • Health
  • Investing
  • Markets
  • Politics
  • Stock Market
  • Technology
  • Uncategorized
  • World

LATEST UPDATES

Pentagon to become largest shareholder in rare earth magnet maker MP Materials

Saratoga Investment Q1: ROE Beating The BDC Industry Average (NYSE:SAR)

  • Disclaimer
  • Privacy Policy
  • DMCA
  • Cookie Privacy Policy
  • Terms and Conditions
  • Contact us

Copyright © 2022 - Euro Times.
Euro Times is not responsible for the content of external sites.

No Result
View All Result
  • Home
  • Finance
  • Business
  • World
  • Politics
  • Markets
  • Stock Market
  • Cryptocurrency
  • Investing
  • Health
  • Technology

Copyright © 2022 - Euro Times.
Euro Times is not responsible for the content of external sites.

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In