Riot Platforms Secures $100 Million Credit Line from Coinbase, Backed by Bitcoin
Riot Platforms (RIOT) has secured a $100 million credit facility from Coinbase’s credit division, using its Bitcoin holdings as collateral. This agreement allows Riot to access much-needed short-term capital to fuel its expansion without issuing new shares.
In a press release, Riot confirmed it would begin drawing on the credit line over the next two months to support strategic growth initiatives and corporate objectives. Riot, which holds 19,223 BTC, currently valued at over $1.8 billion, will use these digital assets to back the loan.
“This credit facility is a pivotal step in diversifying our financing options and supporting our long-term growth strategy,” said Jason Les, CEO of Riot Platforms. “By securing this facility, we can continue to execute on our operational and expansion goals while maintaining shareholder value.”
The loan, issued by Coinbase Credit, carries a variable interest rate starting at 7.75% annually, based on the greater of 3.25% or the upper bound of the federal funds rate, plus an additional 4.5%. The facility has a term of 364 days, with an option for a one-year extension, subject to Coinbase’s approval.
Riot has pledged a portion of its Bitcoin holdings as collateral for the loan. The funds will be allocated for strategic investments and other corporate purposes.
Coinbase has been involved in similar transactions recently. Semler Scientific (SMLR), a healthcare tech company, also entered a similar agreement last week, securing a loan backed by its Bitcoin reserves. Additionally, Hut 8 (HUT), another Bitcoin miner, has previously leveraged Coinbase’s Bitcoin-backed credit services.
