Riot Platforms has revised 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, providing greater cost certainty as the company shifts its focus towards 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 maintains the same loan size and collateral structure, with the loan secured by Riot's bitcoin, USDC, and cash held with Coinbase Custody.
The loan 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 loan-to-value framework, where a top-up is triggered if the LTV ratio exceeds 70% and liquidation occurs at 80%.
This framework poses a risk to Riot's treasury if bitcoin prices continue to decline, potentially forcing the company to further deplete its reserves to support its pivot into AI and HPC. Riot's shares have declined by approximately 9% on Tuesday, to below $17, with the company's Q1 earnings report scheduled for April 30.