Riot Platforms, Inc. (NASDAQ: RIOT), a firm focused on vertically integrated Bitcoin mining, is pleased to announce that it has entered into a $100 million credit facility with Coinbase Credit, Inc., a subsidiary of Coinbase Global, Inc. (NASDAQ: COIN).
Under the terms of the credit facility, Coinbase will provide “a multiple drawdown term loan facility in an aggregate principal amount up to $100 million, which will be made available to Riot over a two-month period following execution of the Credit Facility.”
Riot intends to use proceeds from the credit facility to “pursue key strategic initiatives and for general corporate purposes.”
Jason Les, CEO of Riot, said:
“Riot has entered into its first bitcoin-backed facility, which provides us with non-dilutive funding at an attractive cost of financing. This credit facility is a key part of our efforts to diversify sources of financing to support our operations and strategic growth initiatives, with a view towards long-term stockholder value creation.”
All amounts borrowed under the Credit Facility will “bear interest at an annual rate equal to (a) the greater of (i) the federal funds rate – upper limit1 on the date of the applicable borrowing, and (ii) 3.25%, plus (b) 4.50%.”
The Credit Facility will mature “364 days after the Effective Date, but the Company may request that the maturity date be extended by an additional 364 days, subject to consent by Coinbase.”
The amount borrowed under the Credit Facility will “be secured by a portion of the Company’s total bitcoin holdings.”
Riot’s vision is said to “be the world’s leading Bitcoin-driven infrastructure platform.”
The company reportedly has Bitcoin mining operations “in central Texas and Kentucky, and electrical switchgear engineering and fabrication operations in Denver, Colorado, and Houston, Texas.”
