Riot Platforms has modified its $200 million credit agreement with Coinbase Credit, as disclosed in an 8-K filing. This revision replaces the floating interest rate with a fixed rate, enhancing cost predictability as the company transitions into artificial intelligence and high-performance computing infrastructure, while continuing to decrease its bitcoin holdings.
As of Tuesday, the company's bitcoin holdings stood at 15,680, down from 19,368 at the start of the year, according to bitcoin treasuries.net. The updated agreement retains the original loan size and collateral structure, with the loan secured by Riot's bitcoin, USDC, and cash held in Coinbase Custody. However, the loan term has been extended by 364 days, with the option for a further one-year extension subject to lender approval. The loan operates under a tiered loan-to-value framework, where collateral top-ups are triggered if the loan-to-value ratio exceeds 70%, and liquidation occurs at 80%.
Consequently, if bitcoin prices continue to weaken, Riot may need to further deplete its bitcoin reserve to meet these obligations, potentially funding its pivot into AI and HPC. The company's shares have dropped approximately 9% to below $17 on Tuesday, with Q1 earnings scheduled for release on April 30.