Source: Cointelegraph
Original: “Riot Platforms Secures $100 Million Loan from Coinbase Using Bitcoin Collateral”
Riot Platforms has secured a $100 million credit line from Coinbase, leveraging its substantial Bitcoin reserves as collateral, as the cryptocurrency miner seeks to continue its expansion.
According to CEO Jason Les's statement on April 23, this $100 million loan from Coinbase's credit division is Riot's "first Bitcoin-backed credit facility."
Les stated that the credit line will be used to fund general corporate operations and support the company's "strategic growth plans."
The credit line is set to mature in one year but can be extended for another year. The annual interest rate on the loan is at least 9%, based on the current federal funds rate cap plus 4.5%.
The company noted that crucially, this financing will be "secured by a portion of Riot Platforms' Bitcoin holdings."
According to industry data, as of April, Riot holds 19,223 Bitcoins, making it the third-largest company-level Bitcoin reserve globally. Based on current prices, its Bitcoin assets are valued at approximately $1.8 billion.
As previously reported by Cointelegraph, Riot acquired $500 million worth of Bitcoin last December. Earlier this month, the company also announced plans to raise $500 million through a private bond issuance to fund additional Bitcoin purchases.
RIOT Stock Rises
Riot Platforms' stock, traded on NASDAQ under the ticker RIOT, rose over 8% on April 23, as Bitcoin mining companies and the overall stock market saw a general increase.
However, like other Bitcoin mining companies, RIOT has performed poorly since the beginning of the year, affected by the global trade war and the decline in cryptocurrency prices.
Industry research shows a strong correlation between Bitcoin mining stocks and Bitcoin prices since 2020.
The current trading price of Bitcoin is approximately $93,000, having dropped about 15% since Donald Trump took office as President of the United States. During the same period, Riot Platforms (RIOT) stock has fallen over 40%.
Despite the volatility in stock prices, Riot Platforms has successfully expanded its operations following the Bitcoin halving, achieving record annual earnings and revenue.
In 2024, the company reported sales of $376.7 million and a net profit of $109.4 million.
The company will hold its next earnings call on May 1 to disclose quarterly financial data for the period ending March 31.
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