Note 8. Power Supply Agreements

Rockdale Facility

Power Purchase Agreement

In May 2020, Whinstone US, Inc. (“Whinstone”), the Company’s subsidiary, entered into a long-term power purchase agreement (the “Rockdale PPA”) to provide power at fixed prices to the Rockdale Facility, via the nearby Sandow Switch. Under the Rockdale PPA, the Company has contracted for a total of 345 MW of long-term, fixed-price power, in three blocks: 130 MW contracted in May 2020, through April 30, 2030; 65 MW contracted in March 2022, through April 30, 2030; and 150 MW contracted in November 2022, through October 31, 2027. The Rockdale PPA also permits the purchase of additional power at market prices, as needed.

Under the Rockdale PPA, the Company may elect not to use its contracted power for operations and instead elect to sell that power in exchange for credits against future power costs when doing so is economically beneficial to the Company, depending on the spot market price of electricity. The Company’s power strategy combines participation in Demand Response Service Programs, as defined below, participation in Electric Reliability Council of Texas, Inc.’s (“ERCOT”) Four Coincident Peak program (the “4CP Program”), and sales of power, to attempt to manage operating costs most efficiently.

For the three months ended June 30, 2026 and 2025, the Company earned credits against future power costs in exchange for power resold of approximately $10.1 million and $8.3 million, respectively, and approximately $31.1 million and $16.1 million, respectively, for the six months ended June 30, 2026 and 2025. These amounts are recorded in Power curtailment credits on the Condensed Consolidated Statements of Operations.

The Company determined the Rockdale PPA meets the definition of a derivative because it allows for net settlement. However, because the Company has the ability to offer the power back for sale outside of the Rockdale PPA, rather than taking physical delivery, the Company determined that physical delivery is not probable through the entirety of the contract and therefore, the Company does not believe the normal purchases and normal sales scope exception applies to the Rockdale PPA. Accordingly, the Rockdale PPA (a non-hedging derivative contract) is accounted for as a derivative and recorded at its estimated fair value, with the change in the fair value recorded in Change in fair value of derivatives on the Condensed Consolidated Statements of Operations. The Rockdale PPA is not designated as a hedging instrument. The Demand Response Service Programs (as defined below), and the 4CP Program are not part of the Rockdale PPA and are therefore not subject to treatment and valuation as a derivative along with the Rockdale PPA.

The terms of the Rockdale PPA require margin-based collateral, calculated as exposure resulting from fluctuations in the market rate of electricity relative to the fixed price stated in the contract. As of June 30, 2026, the margin-based collateral requirement was zero.

While the Company manages operating costs at the Rockdale Facility in part by periodically selling back unused or uneconomic power, the Company does not consider such actions to be trading activities.

Demand Response Service Programs

ERCOT offers demand response service programs for customers, including the Company, that can reduce or modify electricity consumption in response to ERCOT instructions or signals (“Demand Response Service Programs”). These Demand Response Service Programs provide the ERCOT market with valuable grid stability and economic services by helping to preserve system reliability, enhancing competition and load predictability, mitigating price spikes, and stabilizing the grid by encouraging the demand side of the market to give more visibility and control of their power consumption to grid operators. Market participants with flexible electrical loads, such as the Company, may participate in these Demand Response Service Programs directly by offering their electrical loads into the ERCOT markets, or indirectly by voluntarily reducing their energy usage in response to increasing power demand in the ERCOT marketplace. The Demand Response Service Programs operate concurrently with the Rockdale PPA.

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Under these Demand Response Service Programs, the Company may participate in various ancillary services by designating a portion of its available electrical load for forward market bidding. Participation in the Demand Response Service Programs is compensated based on hourly power rates and the volume of load bid into each program. Through ancillary services, the Company competitively bids among other market participants to sell ERCOT the ability to control the Company’s electrical load on demand. This requires

the Company to remain powered on during the times in which its power is bid into ancillary services, allowing ERCOT the ability to direct the Company to power down the amount of power bid into the program. The Company receives compensation for its participation in ancillary services whether or not the Company is actually called to power down.

The Company also participates in the 4CP Program, which refers to the highest-load settlement intervals in each of the four summer months (June, July, August, and September), when demand on the ERCOT grid is typically at its highest. The 4CP Program participants may voluntarily power down operations during these times and in doing so, reduce the electrical load demand on the ERCOT grid. Participants that reduce their load during these peak periods receive credits toward transmission costs on future power bills, reducing overall power costs for the subsequent year. The 4CP Program has an indefinite duration.

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Corsicana Facility

During the year ended December 31, 2024, the Company’s subsidiary, Riot Corsicana, LLC, entered into an agreement with ICE Futures U.S., Inc., a subsidiary of InterContinental Exchange, Inc., to access the exchange for the execution of electricity futures contracts. The Company intends to enter into electricity futures contracts up to the amount of power used at the Corsicana Facility. These financial instruments meet the definition of derivatives, but are not designated as hedging instruments, and will be recognized at fair value, with any gains or losses recognized in Net income (loss) on the Condensed Consolidated Statements of Operations.

The Company enters into electricity futures contracts to manage electricity price risks and reduce the variability of cash flows associated with purchases of electricity used for the Company’s Bitcoin Mining operations at its Corsicana Facility.

As of June 30, 2026, the Company held outstanding electricity futures contracts for 805,120 MWh with a combined fair value of $1.5 million included in Prepaid expenses and other current assets on the Condensed Consolidated Balance Sheets.

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The following table presents the realized and unrealized gains and losses recognized by the Company on its electricity futures, which are recognized in Other income (expense) on the Condensed Consolidated Statements of Operations:

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During the year ended December 31, 2024, the Company’s subsidiary, Riot Corsicana, LLC, entered into a requirements contract with MEMS Industrial Supply (“MEMSIS”) under which it will purchase retail power to meet the consumption requirements of the Corsicana Facility. Electric power will be invoiced by MEMSIS based on the market price for electric power at the ERCOT North Load Zone, plus a retail adder corresponding to the peak consumption threshold of the Corsicana Facility, and pass-through charges (including ancillary charges, taxes, congestion, and line loss), based on the actual variable consumption of the Corsicana Facility. The contract, dated November 12, 2024, has a three-year term ending November 25, 2027. Although this contract does not require the supply of power at a fixed price, it allows the parties to enter into fixed-price contracts. 

Under the requirements contract with MEMSIS, during the year ended December 31, 2024, Riot and MEMSIS entered into a power purchase agreement (the “Corsicana PPA”), a three-year contract (January 1, 2025 through December 31, 2027, but excluding July and August contracts during the period) for a fixed quantity of 25 MW at a fixed price of $43.95 per MWh.

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The Company determined the Corsicana PPA meets the definition of a derivative and, accordingly, the Corsicana PPA (a non-hedging derivative contract) is recorded at its estimated fair value each reporting period on the Condensed Consolidated Balance Sheets with the change in the fair value recorded in Change in fair value of derivatives on the Condensed Consolidated Statements of Operations. The Corsicana PPA is not designated as a hedging instrument.

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Kentucky Facility

In April 2021, the Company’s subsidiary, Block Mining, Inc. (“Block Mining”), entered into a long-term power purchase agreement, and subsequent amendments to the long-term power purchase agreement (collectively, the “Kentucky PPA”), to provide power to one of its locations in Kentucky. Pursuant to the Kentucky PPA, the Company has the ability, but not the obligation, to acquire up

to a total of 67 MW of power at one of its facilities through mid-April 2041. The all-in power rate includes a portion of the total fee that is at a fixed rate and another portion that adjusts annually. The Company determined the Kentucky PPA does not meet the definition of a derivative because it does not contain any net settlement provisions.

Under the Kentucky PPA, the Company may elect not to use its long-term, fixed-price power for its operations, and instead elect to sell that power back into the Midcontinent Independent System Operator, Inc. (“MISO”) grid in exchange for credits against future power costs when there is a benefit to the Company, depending on the spot market price of electricity. The Company’s power strategy combines participation in Demand Response Service Programs and sales of power, to attempt to manage operating costs efficiently.

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Derivative Valuations

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The Company’s contracts accounted for as derivatives include the Rockdale PPA and Corsicana PPA.

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The following table presents the unobservable inputs used in the valuation of the Company’s derivatives:

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Rockdale PPA

For all periods presented, the fair value of the Rockdale PPA was in an asset position and included in Derivative assets on the Condensed Consolidated Balance Sheets.

The following table presents the changes in the estimated fair value of the Rockdale PPA:

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Corsicana PPA

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As of June 30, 2026, the fair value of the Corsicana PPA was in a liability position of $0.6 million, which was included in Accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheets, due to a significant decline in forward power prices used to determine the fair value, relative to the contracted price. As of January 1, 2025, June 30, 2025, and December 31, 2025, the fair value was in an asset position and included in Derivative assets on the Condensed Consolidated Balance Sheets.

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The following table presents the changes in the estimated fair value of the Corsicana PPA:

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The estimated fair values of the Rockdale PPA and Corsicana PPA are classified under Level 3 of the fair value hierarchy due to the significant unobservable inputs used in the valuation. These inputs include the fixed price of each block for the 345 MW of power to be delivered under the Rockdale PPA and 25 MW of power to be delivered under the Corsicana PPA. The valuation relies on discounted cash flow estimation models incorporating quoted commodity exchange spot and forward prices in MWh adjusted for basis spreads for load zone-to-hub differentials through the term of the Rockdale PPA, which is scheduled to end as of April 30, 2030, and the term of the Corsicana PPA, which is scheduled to end as of December 31, 2027, and a discount rate of 24.1%. Actual power usage is not a variable input in the determination of the fair value as the price and quantity of power to be delivered per the Rockdale PPA and the Corsicana PPA are fixed despite the existence of multiple blocks with separate power amounts.

The discount rate reflects the nature of the contract as it relates to the risk and uncertainty of the estimated future mark-to-market adjustments, forward price curves of the power supply, broker/dealer quotes, and other similar data obtained from quoted market prices or independent pricing vendors, risk-free rate of return, which is determined from United States Treasury Bond yields, estimated cost of debt, which includes a Moody’s rating, and an equity risk premium based on market data provided by a global cost of capital service provider. The discount rate includes observable market inputs, but also includes unobservable inputs based on qualitative judgment related to the Company’s credit risk.