Riot Platforms has revised its $200 million credit agreement with Coinbase Credit, as disclosed in a recent 8-K filing. This revision replaces the variable interest rate with a fixed one, providing the company with more predictable expenses as it transitions into artificial intelligence and high-performance computing infrastructure. Concurrently, Riot continues to decrease its bitcoin holdings, with its treasury decreasing from 19,368 BTC at the beginning of the year to 15,680 BTC as of Tuesday, according to data from bitcoin treasuries.net. The revised agreement maintains the same loan and collateral structure, with Riot's bitcoin, USDC, and cash held in Coinbase Custody serving as security for the credit facility.
However, the loan's maturity has been extended by 364 days, with the possibility of a further one-year extension subject to lender approval. The loan operates under a loan-to-value framework, which may necessitate additional collateral if bitcoin's price experiences a sharp decline. The framework includes a tiered system where, under normal circumstances, a top-up is required if the loan-to-value ratio exceeds 70%, and liquidation occurs at 80%.
As a result, if bitcoin prices continue to weaken, Riot may need to further deplete its treasury to support its pivot into AI and HPC. Riot's shares have declined by approximately 9% on Tuesday, falling below $17. The company is scheduled to release its Q1 earnings on April 30.