Riot Platforms has modified its $200 million credit agreement with Coinbase Credit, replacing the variable interest rate with a fixed one, as disclosed in an 8-K filing. This change provides greater predictability in borrowing costs as the company shifts its focus towards artificial intelligence and high-performance computing infrastructure, while also continuing to decrease its bitcoin reserves. As of Tuesday, the company'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 maintains the same loan size and collateral structure, with the credit facility secured by Riot's bitcoin, USDC, and cash held with Coinbase Custody. However, the loan's maturity has been extended by 364 days, with the option to extend it further by a year, subject to lender approval. The loan operates under a loan-to-value framework, where a sharp decline in bitcoin's price could trigger collateral top-ups, potentially leading to further depletion of Riot's treasury as it funds its pivot into AI and HPC.
The company's shares have fallen around 9% to below $17 on Tuesday, with Q1 earnings scheduled to be reported on April 30.