Coinbase’s debt rating lowered at S&P Global, profits likely to remain ‘pressured’

Debt ratings agency S&P Global late Wednesday lowered its rating on Coinbase Global Inc.’s
COIN,
+1.30%
debt one notch to BB-, with a negative outlook, saying Coinbase’s trading volumes have “weakened meaningfully” in the aftermath of the collapse of cryptocurrency exchange FTX and that regulatory risk is rising. “We expect profitability to remain pressured in 2023, despite the recently announced reduction in operating expenses and tailwinds from rising interest rates,” S&P said. The negative outlook reflects “continued uncertainties about the depth and duration of the crypto market downturn” as well, the debt ratings agency said. Shares of Coinbase edged lower in the extended session Wednesday after ending the regular trading day up 1.3%. Coinbase announced job cuts on Tuesday, mentioning the downward trend for crypto and the fallout from “unscrupulous actors in the industry.”