New Hampshire Unveils $100 Million Bitcoin-Backed Municipal Bond

New Hampshire Makes History with Bitcoin-Backed Bond

The Business Finance Authority (BFA) of New Hampshire has approved a groundbreaking $100 million Bitcoin-backed municipal bond, marking a significant milestone in U.S. financial history. This innovative bond bridges traditional debt markets and digital assets, offering companies the opportunity to secure loans using over-collateralized Bitcoin, securely held by a private custodian.

Investor Security and Bitcoin Collateral

Importantly, the bond poses no financial risk to the state or its taxpayers, as the BFA functions solely as an approving conduit. Investor security is further ensured by Bitcoin collateral, safeguarded by BitGo, with a liquidation mechanism ready to activate should Bitcoin prices drop significantly.

Strategic Bitcoin Reserve and Economic Development

This development follows New Hampshire's legislative action in May, when it became the first state to establish a strategic Bitcoin reserve, permitting up to 5% of public funds to be invested in digital assets. Governor Kelly Ayotte praised the bond as a forward-thinking approach to attracting investment and reinforcing the state’s leadership in digital finance without risking public funds.

Funding Innovation and Growth

Proceeds from the bond will finance the Bitcoin Economic Development Fund, aimed at fostering innovation and business growth across the state. This initiative is supported by the municipal bond law firm Orrick, ensuring compliance. Les Borsai of Wave Digital Assets emphasized the bond’s role in merging fixed income with digital assets on a global scale.

GOP Representative Keith Ammon views the bond as a crucial experiment in government finance, showcasing Bitcoin's potential as high-quality collateral. The BFA's approval highlights the integration of digital assets into core financial systems.