Riot Platforms has revised its $200 million credit agreement with Coinbase Credit, as disclosed in an 8-K filing, replacing the variable interest rate with a fixed one to enhance cost predictability, while the company proceeds to decrease its bitcoin holdings. The adoption of a fixed interest rate provides stability as Riot expands into artificial intelligence and high-performance computing infrastructure, concurrently reducing its bitcoin reserves. As of Tuesday, the company held 15,680 BTC, down from 19,368 BTC at the start of the year, according to bitcoin treasuries.net. The revised agreement retains the same loan size and collateral structure, with Riot's bitcoin, USDC, and cash held with Coinbase Custody serving as security.
The loan's maturity has been extended by 364 days, with the option to extend it by an additional year, subject to lender approval. The loan operates under a tiered loan-to-value framework, where a top-up is triggered if the LTV ratio exceeds 70% and liquidation occurs at 80%.
Consequently, Riot may continue to deplete its bitcoin reserves if the cryptocurrency's price continues to decline, potentially funding its pivot into AI and HPC. Riot's shares have declined by approximately 9% on Tuesday to below $17, with the company scheduled to report its Q1 earnings on April 30.