New Hampshire Executive Council Rejects $100 Million Bitcoin-Backed Municipal Bond Proposal

The New Hampshire Executive Council voted 3-2 on July 8, 2026, to reject a first-of-its-kind $100 million Bitcoin-backed municipal bond proposal. Supported by Governor Kelly Ayotte, the conduit debt structure aimed to fund private borrower CleanSpark using $160 million in Bitcoin collateral, shielding taxpayers from direct risk. However, critics cited extreme volatility and a tight 12.5% liquidation trigger, alongside a speculative Ba2 junk rating from Moody's, to block the deal.

Bitcoin-backed municipal bond proposal

• ▪The proposed bond transaction was structured as a limited-recourse obligation, meaning bondholders would have recourse only to the Bitcoin collateral with no risk to New Hampshire taxpayers
• ▪The proposed bond sale was managed by Jefferies through private placement, with BitGo designated as the custodian for the Bitcoin holdings in segregated wallets
• ▪The New Hampshire Business Finance Authority proposed to issue up to $100 million in taxable conduit municipal revenue bonds collateralized by Bitcoin

Executive Council approval process

• ▪New Hampshire Executive Councilors David Wheeler, Karen Liot Hill, and Janet Stevens voted against the proposal, while John Stephen and Joseph Kenney voted in favor
• ▪New Hampshire Governor Kelly Ayotte expressed support for the bond proposal, calling it an innovative way to bring investment opportunities to the state without risking public funds
• ▪The New Hampshire Executive Council voted 3-2 on July 8, 2026, to reject the $100 million Bitcoin-backed municipal bond proposal

Moody's junk bond rating

• ▪The Ba2 rating from Moody's Investors Service is a speculative-grade rating two notches below investment grade, placing the bonds in the category of junk bonds
• ▪Moody's Investors Service assigned a provisional Ba2 rating to the proposed Bitcoin-backed bonds in March 2026

Bitcoin price volatility risks

• ▪New Hampshire Executive Councilor Karen Liot Hill opposed the bond, stating that the transaction asked the state to lend legitimacy to a highly volatile, emerging asset class
• ▪David Krause, an emeritus associate professor of finance at Marquette University, concluded that the bond's primary significance lies in highlighting the challenges of adapting traditional financial frameworks to highly volatile digital assets

Automatic liquidation provisions

• ▪Under the proposed structure, the private borrower tied to CleanSpark would deposit approximately $160 million in Bitcoin as collateral against $100 million of obligations
• ▪The proposed bonds would enter mandatory liquidation and early redemption if the Bitcoin collateral value fell below $140 million, representing a roughly 12.5% price drop
• ▪David Krause modeled the structure and found that historical Bitcoin price fluctuations would be highly likely to trigger the plan's 140% liquidation provision

New Hampshire crypto innovation strategy

• ▪Governor Kelly Ayotte signed House Bill 639, known as the Blockchain Basics Law, to protect cryptocurrency self-custody and establish a special blockchain dispute docket in the superior court
• ▪Governor Kelly Ayotte signed a law in May 2025 making New Hampshire the first U.S. state to pass a strategic Bitcoin reserve bill, allowing the state treasurer to invest up to 5% of public funds in Bitcoin