New Hampshire Makes History with World’s First Bitcoin-Backed Municipal Bond Issuance

New Hampshire Makes History with World’s First Bitcoin-Backed Municipal Bond

Concord, NH — In a groundbreaking move that positions New Hampshire at the forefront of financial innovation, the New Hampshire Business Finance Authority (BFA) board of directors has approved a financing structure that will allow the state to issue the world’s first municipal bond backed by bitcoin. This historic $100 million issuance marks a significant milestone in the integration of digital assets with traditional capital markets.

The initiative, conceptualized by Wave Digital Assets in collaboration with Rosemawr Management, aims to bridge the gap between the burgeoning digital asset ecosystem and conventional debt markets. Legal structuring for the transaction was advised by Orrick, while BitGo Trust Company, Inc. will act as custodian for the bitcoin collateral, ensuring it is securely stored in regulated cold storage with advanced security measures.

Pending approval from the Governor and Executive Council, this bond issuance will be the first instance of a digital-asset company accessing the municipal bond market through a structured, institutional framework.

“This clearly positions New Hampshire as a global leader in responsible crypto finance,” said James Key-Wallace, executive director of the BFA. “We’re proud to develop new tools that allow companies in the digital-asset ecosystem to access capital safely and effectively, while ensuring no taxpayer funds or state guarantees are at risk.”

Governor Kelly Ayotte expressed her pride in New Hampshire’s pioneering spirit, stating, “This is an innovative way to bring more investment opportunities to our state and position us as a leader in digital finance without risking state funds or taxpayer dollars.”

The bond structure allows investors to purchase BFA-issued bonds, with the aim of establishing bitcoin as a reliable form of collateral, regulated under the same standards that govern municipal and corporate bonds. Les Borsai, co-founder of Wave Digital Assets, emphasized the broader implications of this transaction, stating, “This isn’t just one transaction; it’s the opening of a new debt market.”

The BFA’s fees from this transaction will contribute to the establishment of the Bitcoin Economic Development Fund, which will reinvest in programs that foster business growth and financial innovation across New Hampshire.

Orion Mountainspring, a partner at Orrick, highlighted the significance of this initiative, saying, “The BFA has set the precedent for how municipalities can leverage emerging technologies like blockchain to broaden their investor base and reduce funding costs for their constituents.”

New Hampshire has already made strides in the cryptocurrency space, being the first state in the U.S. to pass a cryptocurrency reserve law, allowing state-chartered institutions to hold bitcoin and other digital assets as part of their reserves. The bitcoin trust for this bond will be held by a New Hampshire Statutory Trust, further embedding the transaction within the state’s expanding fintech ecosystem.

As New Hampshire embarks on this unprecedented venture, it not only sets a new standard for municipal finance but also opens the door for future collaborations between public and private sectors in the realm of digital assets.