Riot Platforms has modified its $200 million credit agreement with Coinbase Credit, as disclosed in an 8-K filing, replacing the variable interest rate with a fixed rate to enhance cost predictability. This development occurs as the company continues to divest its bitcoin holdings and transition towards artificial intelligence and high-performance computing infrastructure.
As of Tuesday, Riot's bitcoin holdings stood at 15,680, marking a decrease from the 19,368 held at the beginning of the year, according to bitcoin treasuries.net. The revised agreement retains the original loan size and collateral structure, with the credit facility secured by Riot's bitcoin, USDC, and cash held in Coinbase Custody. Furthermore, the maturity period has been extended by 364 days, with the option for a further one-year extension subject to lender approval.
The loan operates under a tiered loan-to-value framework, where collateral top-ups are triggered if the loan-to-value ratio exceeds 70%, and liquidation occurs at 80%. Consequently, if bitcoin prices continue to decline, Riot may be compelled to further deplete its treasury to meet these obligations, thereby funding its strategic shift towards AI and HPC. The company's shares have declined by approximately 9% to below $17, with Q1 earnings scheduled for release on April 30.