Riot Platforms has modified 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 more predictable expenses as the company diversifies into artificial intelligence and high-performance computing infrastructure, while also reducing its bitcoin holdings.
As of Tuesday, the company's bitcoin reserves 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 and collateral structure, with the credit facility secured by Riot's bitcoin, USDC, and cash held in Coinbase Custody.
However, the loan's maturity has been extended by 364 days, with the option to further extend it by a year, subject to lender approval. The loan operates under a loan-to-value framework, where collateral top-ups are required if the bitcoin price drops significantly, with a tiered structure triggering top-ups at a 70% loan-to-value ratio and liquidation at 80%. This could lead to continued depletion of Riot's bitcoin treasury if the cryptocurrency's price remains weak, potentially funding its pivot into AI and HPC.
Riot's shares have declined by around 9% on Tuesday to below $17, with the company scheduled to report its Q1 earnings on April 30.