New Hampshire Launches First US $100 Million Municipal Bond Backed by Bitcoin Collateral
The New Hampshire Business Finance Authority has announced a groundbreaking $100 million conduit bond program allowing firms and nonprofits to borrow against their Bitcoin holdings, marking the first such initiative in the United States.
This bond requires 160% overcollateralization with Bitcoin and mandates liquidation if the Bitcoin collateral value falls to 130% of the bond value. Fees generated from bond transactions and gains in BTC collateral will be funneled into the Bitcoin Economic Development Fund.
The bonds will finance private firms and nonprofits engaged in public works by leveraging Bitcoin as collateral at 160% of the borrowed amount. This move follows New Hampshire's strategic crypto reserve bill passed in May, which laid the legal groundwork for this innovative financial tool.
Governor Kelly Ayotte highlighted the bond as an innovative step positioning New Hampshire as a leader in digital finance while ensuring no risk to state funds or taxpayers. The program is self-funded and serves as a proof-of-concept for using Bitcoin as collateral in government finance, with potential for evolving into a state treasury Bitcoin bond.
Industry experts believe the initiative could legitimize Bitcoin beyond mere speculation and expand its use in debt markets, though they caution about the risks of forced liquidation if Bitcoin’s price declines sharply. Analysts suggest that a successful rollout could encourage other states to adopt similar crypto-backed financing methods and further integrate Bitcoin into public finance systems.
