Issuers use these hedges to prevent existing shareholders from diluting with convertible debt, even if their share price rises above the conversion price, still incurring a fee. During its breakout rally, fitness company Peloton raised $1 billion in convertible debt with a capped call option due in 2021. “The capped call transaction, subject to customary adjustments, will include the number of shares of Coinbase’s Class A common stock that will initially be subordinated to the Notes,” Coinbase said.