• Coinbase’s guaranteed senior unsecured notes were downgraded from Ba1 to Ba2.
• Bonds having a rating of Ba1 or lower are termed “junk”.
• The company has $2 billion in senior guaranteed notes maturing in 2028 and 2031.

Moody’s Investors Services lowered Coinbase’s corporate debt on Thursday evening in New York, one week after the business announced it will reduce its employment by approximately one-fifth.

The credit rating agency announced that it had downgraded Coinbase’s guaranteed senior unsecured notes from Ba1 to Ba2 and its corporate family-rated debt from Ba3 to Ba2. Bonds having a rating of Ba1 or lower are termed “junk.”

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The agency also noted that Coinbase has $2 billion in senior guaranteed notes maturing in 2028 and 2031, and placed its ratings under scrutiny for additional downgrades.

The blow to Coinbase occurred during a turbulent period for the cryptocurrency industry, which has been battered by the falling values of key coins and a number of companies ceasing operations. Numerous organizations have abandoned ambitious expansion goals.

“Today’s rating action 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.

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“Moody’s expects the company’s profitability to remain challenged in the current environment despite its 14 June announcement of a reduction in its global workforce of around 1,100 employees.”

After being targeted by hackers, blockchain network Harmony said on Thursday that it has been the victim of a $100 million theft. The company stated that it was collaborating with national authorities to locate the perpetrator and recover the stolen monies.