Key Highlights
- New Hampshire’s Business Finance Authority will launch America’s inaugural rated bitcoin-collateralized municipal bond
- The bond received a provisional Ba2 rating from Moody’s — classified as speculative-grade
- BitGo provides custody services for the bitcoin collateral with 1.6x overcollateralization requirements
- Taxpayer funds face zero exposure; the state functions solely as a conduit issuer
- Initial issuance totals $100 million, structured by Wave Digital Assets alongside Rosemawr Management
The Business Finance Authority of New Hampshire (BFA) is moving forward with plans to launch what appears to be the nation’s first rated municipal bond backed by bitcoin collateral.
On Tuesday, Moody’s Ratings issued a provisional Ba2 rating for the instrument. This classification puts the bond in the speculative category, sitting two levels beneath investment-grade status and indicating elevated credit risk.
The provisional nature of the rating stems from Moody’s awaiting finalized legal documentation before confirming its assessment. No specific issuance date has been announced yet.
Bitcoin stored under the custody of BitGo Trust Company acts as the underlying collateral. Should payment obligations arise, the cryptocurrency will be converted to cash to satisfy both interest payments and principal amounts.
The arrangement mandates 1.6x overcollateralization. Additionally, automatic liquidation mechanisms activate when the loan-to-value ratio falls below predetermined thresholds.
Moody’s applied a 72% advance rate alongside compressed liquidation timeframes when evaluating potential downside scenarios. The rating agency identified bitcoin’s price fluctuations as the primary driver behind the Ba2 designation.
Earlier this month, S&P Global observed that while bitcoin’s volatility has decreased over recent years, it remains significantly higher than both gold and the Nasdaq-100 index.
Taxpayer Funds Remain Protected
These bonds feature limited recourse provisions. This structure ensures that New Hampshire’s taxpayer money cannot be tapped to reimburse bondholders in any scenario.
Moody’s explicitly confirmed this safeguard in its analysis, declaring that “no public funds of the State of New Hampshire may be used to pay amounts under the Rated Bonds.”
New Hampshire operates as a conduit issuer in this transaction, comparable to instances where states facilitate bonds for private-sector initiatives. The state’s creditworthiness does not underpin this offering.
The Development Process
New Hampshire’s BFA greenlit the initiative in November 2025. During that approval, the authority proclaimed it would become the first state globally to issue such an instrument.
Asset management firm Wave Digital Assets developed the program alongside bond specialist Rosemawr Management. BitGo Trust Company handles custodial responsibilities for the bitcoin collateral.
The bond program launches with a $100 million capacity. It enables corporations to secure loans against their overcollateralized bitcoin positions.
Revenue generated from the program will flow into a Bitcoin Economic Development Fund. According to the BFA, these resources will bolster business expansion and financial innovation throughout New Hampshire.
This transaction introduces bitcoin into a segment of finance where it has maintained minimal presence — rated debt securities issued through governmental channels.
This past Monday, the Labor Department unveiled a proposed regulation, stemming from a presidential executive order by President Trump, aimed at broadening digital asset accessibility within retirement investment accounts.
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