Coinbase warns of forced crypto sales due to rising debt
Coinbase is raising red flags about the financial health of publicly traded crypto vehicles, cautioning that debt-related obligations could soon force some firms to liquidate their crypto holdings.
In a report from Coinbase, the firm emphasized concerns around refinancing risks and loan-to-value ratios, but said most large firms still have options to avoid liquidation.
“The risk of forced selling pressure arises because many of these PTCVs have issued convertible bonds to raise cheap money to buy various crypto assets,” the report read.
The report continued to say that if crypto prices fall and companies can’t refinance their debts, they may be forced to sell their crypto holdings, triggering broader…
