Riot Platforms has revised its $200 million credit agreement with Coinbase Credit, as disclosed in an 8-K filing. This revision replaces the variable interest rate with a fixed one, enhancing cost predictability as the company diversifies into artificial intelligence and high-performance computing infrastructure, while also decreasing its bitcoin holdings. As of Tuesday, Riot's bitcoin holdings stood at 15,680, down from 19,368 at the start of the year, according to bitcoin treasuries.net.
The revised agreement maintains the loan size and collateral structure, with the loan secured by Riot's bitcoin, USDC, and cash held in Coinbase Custody. The loan maturity has been extended by 364 days, with the option to extend it by another year, subject to lender approval. The loan operates under a loan-to-value framework, where collateral top-ups are required if the bitcoin price drops significantly, with a tiered structure triggering top-ups at a 70% loan-to-value ratio and liquidation at 80%. This could lead to further depletion of Riot's bitcoin treasury if the market continues to be weak, funding its pivot into AI and HPC.
Riot's shares have fallen by around 9% on Tuesday, below $17, with the company set to report its Q1 earnings on April 30.