New Hampshire Authority to Launch First Rated Bitcoin-Backed Bond
The New Hampshire Business Finance Authority is preparing to issue a pioneering bitcoin-backed bond, marking a major step toward integrating cryptocurrency into traditional public finance markets.
Moody’s has assigned a provisional Ba2 rating, two notches below investment grade, to the bonds, which will be collateralized with bitcoin BTC $68,874.54 held in custody by BitGo. Bondholders will be repaid through the liquidation of the BTC if necessary to cover interest and principal.
“The Rated Bonds will be collateralized by a loan… backed by Bitcoin, a digital currency,” Moody’s said. Unlike conventional bonds, repayment does not depend on cash flows from a business or government entity. The structure includes 1.6x overcollateralization and automatic liquidation triggers if the loan-to-value ratio falls.
Moody’s noted that the rating reflects the risks associated with bitcoin’s volatility and the deal’s structure. Limited recourse terms ensure that no public funds of New Hampshire are exposed, with the authority acting as a conduit rather than providing a state credit guarantee.
This issuance represents one of the first examples of bitcoin entering rated public debt markets. While speculative-grade, the Ba2 rating highlights the development of frameworks for evaluating crypto-backed instruments.
The announcement comes amid growing institutional interest in using bitcoin beyond trading and treasury holdings. Following a Trump-era executive order, the Labor Department recently proposed rules to expand access to digital assets in retirement accounts, further supporting mainstream adoption.
