New Hampshire’s initiative to issue what proponents assert to be the world’s first Bitcoin-backed municipal bond is set to undergo final scrutiny by the state’s Executive Council on Wednesday, representing the last required approval for the $100 million project, as reported by The Boston Globe today.
Governor Kelly Ayotte has characterized this endeavor as “historic,” and the five-member council plans to conduct a public hearing on Wednesday morning at the request of James Key-Wallace, executive director of the New Hampshire Business Finance Authority.
Key-Wallace has urged the council to assess the proposal as both feasible and beneficial to the public, requesting authorization for the quasi-governmental agency to proceed with the initiative. He posits that this model will position the state as “a global leader in responsible crypto finance.”
The structure of this bond diverges significantly from a traditional municipal bond in one essential aspect: public funds are not at risk. Instead of the government repaying investors, a private borrower, specifically CleanSpark—a Bitcoin mining firm—will be responsible for repayment, using Bitcoin as collateral.
Payments for the bond are funded through proceeds tied to this collateral, while investors also gain potential upside through additional payments associated with Bitcoin price appreciation. Should Bitcoin’s price dip below a predetermined threshold, a trust holding the collateral can be liquidated to ensure full repayment to bondholders.
JUST IN: New Hampshire Governor & Executive Council to hold a hearing tomorrow on establishing a Bitcoin-backed $100 million municipal bond
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— Bitcoin Magazine (@BitcoinMagazine) July 7, 2026
The transaction will be administered by digital asset firm Wave Digital Assets, with BitGo designated as the custodian responsible for securely storing the Bitcoin in a regulated cold storage environment.
Moody’s has clarified that “no public funds of the State of New Hampshire or any political subdivision thereof may be used to pay amounts under the rated bonds.”
New Hampshire’s Push for Bitcoin
This initiative is part of a broader strategy aimed at attracting blockchain-related business to New Hampshire, a state that first enacted a strategic Bitcoin reserve law in 2025. Advocates argue that the bond will provide the Business Finance Authority with a revenue stream to fund its investment programs without exposing taxpayers to the inherent volatility of Bitcoin’s price fluctuations.
However, concerns regarding price volatility persist. The three-year bond’s reliance on a fluctuating asset as collateral raises the risk of automatic liquidation should there be a downturn within the market.
Documents submitted by Key-Wallace to the council assert that the state is insulated from risk, as the loan agreement establishes a conduit between private investors and a private borrower, with cryptocurrency serving merely as collateral, devoid of any governmental guarantee.
Risk assessment is reflected in ratings; Moody’s has assigned the bonds a provisional “Ba2” rating, two notches below investment grade, recognizing them as speculative and associated with substantial credit risk—a tier often characterized as “junk.” Keith Ammon, a Republican state representative actively engaged in the state’s cryptocurrency policy, affirmed to the Granite State News Collaborative that this rating appears justified as a prudent starting point given the innovative nature of the proposal.
Further scrutiny from external analysts reveals additional concerns. David Krause, an emeritus finance professor at Marquette University, evaluated the plan and identified that recent fluctuations in Bitcoin prices could “highly likely” trigger the liquidation provision, according to The Boston Globe.
While the state would be “legally insulated from direct financial liability,” Krause asserted that the introduction of such a volatile collateral type undermines the transparency, predictability, and stability that municipal finance has historically upheld. He emphasized that insulating the state from liability does not eliminate reputational risks.
“Although the bond may serve as a demonstration of integrating digital assets into structured finance, it is ill-suited for general-purpose public finance,” he concluded.
A favorable vote on Wednesday will authorize the Business Finance Authority to proceed with the issuance of the bond.
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