New Hampshire Launches First $100M Bitcoin-Backed Municipal Bond in U.S.

New Hampshire’s $100M Bitcoin-backed municipal bond lets companies borrow against over-collateralized Bitcoin held by a secure institutional custodian.

The bond’s structure posts 160% Bitcoin collateral with a liquidation mechanism, ensuring investors remain fully covered throughout market fluctuations.

Fees and gains from the bond support the Bitcoin Economic Development Fund, promoting entrepreneurship, innovation, and state-level economic growth.

Bitcoin-backed municipal bond adoption moved into new territory as New Hampshire authorized a $100 million Bitcoin-backed conduit bond, marking a first for the United States. The approval positions the state as an early adopter of digital asset-linked financial instruments in public financing.

State Advances First Bitcoin-Backed Bond Structure

New Hampshire’s Business Finance Authority approved the bond after months of expanding its digital asset policies. The bond framework allows private companies to borrow against over-collateralized Bitcoin held by a custodian rather than rely on taxpayer support. Officials confirmed that the BFA only administers the transaction and does not take on repayment risk.

Governor Kelly Ayotte supported the initiative, noting that the structure introduces new investment pathways without exposing the state’s finances. Her administration previously authorized the treasury to allocate up to 5% of public funds into digital assets, forming the nation’s first strategic Bitcoin reserve. This approach signals New Hampshire’s continued move toward blockchain-aligned economic development.

Statements shared on social platforms emphasized that the transaction marks the first municipal security tied to Bitcoin collateral. The announcement also noted that investors are protected through assets held in custody by BitGo, which manages the collateral through established institutional processes.

How the Collateral and Liquidation System Works

The bond was developed by Wave Digital Assets and Rosemawr Management, two firms experienced in digital asset and municipal debt structures. Under the arrangement, the borrower posts around 160% of the bond’s value in Bitcoin. This collateral threshold allows capital deployment without requiring borrowers to sell their Bitcoin.

If the collateral ratio falls near 130%, the mechanism requires liquidation to ensure bondholders receive full coverage. State officials stated that this system adheres to existing municipal bond rules, aligning the digital collateral with traditional underwriting standards. GOP Rep. Keith Ammon added that the structure operates as a testing ground for future treasury-issued instruments backed by digital assets.

According to BFA Executive Director James Key-Wallace, fees from the transaction and any gains from the collateral will support the Bitcoin Economic Development Fund. These resources will assist programs that promote entrepreneurship and business growth throughout the state.

Opening a Pathway Into the Global Debt Market

Participants involved in the deal view the structure as a bridge connecting Bitcoin with the $140 trillion global debt market. Crypto reserves often sit unused, but this model allows them to support regulated financial products. Wave Digital Assets stated that the bond could help institutions gain exposure to digital assets through fixed-income instruments.

Orrick, a leading municipal bond law firm, advised on the transaction. The firm noted in a public statement that the deal introduces cryptocurrency into traditional municipal finance. This development may encourage other states to consider similar structures if New Hampshire’s approach proves stable.

Wave’s leadership expects broader institutional interest once ratings are assigned. They noted that future products may combine digital asset reserves with fixed-income strategies as demand grows for regulated frameworks. This bond introduces a controlled entry point for large investors seeking exposure without adding excess risk to existing portfolios.

The post New Hampshire Launches First $100M Bitcoin-Backed Municipal Bond in U.S. appears on Crypto Front News. Visit our website to read more interesting articles about cryptocurrency, blockchain technology, and digital assets.