Riot Platforms has revised its $200 million credit agreement with Coinbase Credit, as disclosed in an 8-K filing, switching from a variable to a fixed interest rate to enhance cost predictability while it continues to divest its bitcoin assets. This strategic move towards a fixed rate offers greater stability as Riot expands into artificial intelligence and high-performance computing infrastructure, simultaneously reducing its bitcoin holdings. As of Tuesday, the company's bitcoin reserves had decreased to 15,680 BTC from 19,368 BTC at the beginning of the year, according to bitcoin treasuries.net. The revised agreement maintains the loan amount and collateral structure, with Riot's bitcoin, USDC, and cash held in Coinbase Custody serving as security.
The loan maturity has been extended by 364 days, with the option for a further one-year extension subject to lender approval. The credit facility operates under a loan-to-value framework, where collateral top-ups are required if bitcoin's price drops significantly, with a tiered system triggering top-ups at a 70% LTV ratio and liquidation at 80%. This means Riot may need to further deplete its bitcoin treasury to meet these obligations if the cryptocurrency's value continues to decline, potentially funding its pivot into AI and HPC. Riot's shares have fallen approximately 9% to below $17 on Tuesday, with the company scheduled to release its Q1 earnings on April 30.