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. This development occurs as the company shifts its focus towards artificial intelligence and high-performance computing infrastructure, while simultaneously reducing its bitcoin holdings. As of Tuesday, Riot's bitcoin holdings stood at 15,680, down from 19,368 at the beginning of the year, according to bitcoin treasuries.net. The revised agreement retains the original loan size and collateral structure, with Riot's bitcoin, USDC, and cash held with Coinbase Custody serving as security.
The credit facility's maturity has been extended by 364 days, with the option to prolong it by an additional year, subject to lender approval. The loan operates under a tiered loan-to-value framework, where a collateral 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, thereby funding its pivot towards AI and HPC.
Riot's shares have declined by approximately 9% on Tuesday, dropping below $17, with the company scheduled to report its Q1 earnings on April 30.