New Hampshire Council Rejects $100 Million Bitcoin-Backed Bond

The New Hampshire Executive Council rejected a plan on Wednesday to authorize a $100 million bond backed by Bitcoin, killing a proposal that state officials had cast as a first-in-the-nation bid to draw digital finance to the Granite State.

The New Hampshire councilors voted 3-2 against it, according to reporting from The Boston Globe.

The New Hampshire Business Finance Authority and Governor Kelly Ayotte had promoted the bond as “groundbreaking” and “historic.” The deal would have stood as the world’s first Bitcoin-backed municipal bond. The plan had cleared Moody’s ratings and reached the Executive Council for its final vote before issuance.

The council did not share that enthusiasm. Karen Liot Hill, the lone Democrat, framed her opposition as caution rather than hostility. 

“I’m not opposed to Bitcoin or cryptocurrency in general,” she told The Boston Globe. “But I do think that we are being asked as a state to lend a kind of legitimacy to a financial transaction, which is from … an emerging asset class that has been shown to be very volatile.”

Bitcoin is ‘emerged’

James Key-Wallace, executive director of the Business Finance Authority, disputed the framing. “The only quibble I would have is … I wouldn’t call them ’emerging,’” he said. “They’ve ’emerged.’ They’re here.”

Key-Wallace stressed that the bond carried zero risk for New Hampshire taxpayers. The loan agreement would create a conduit between private investors and a private borrower, with cryptocurrency as collateral. 

The state would owe nothing, even in a Bitcoin crash. Should Bitcoin climb across the three-year term, the authority could collect millions in fees for small business, child care, housing, and economic development programs. He said the deal could lead to “several more.”

Ayotte, who last year signed a law giving the state treasurer discretion to invest in Bitcoin and made New Hampshire the first state to pass a strategic Bitcoin reserve into law, defended the value of moving first. 

“I think it’s something that we really need to think about,” she said, “because our state continues to thrive when we are continuing to be innovative — and especially if we can do so in a way that protects the taxpayers.”

Liot Hill moved to table the proposal, but no colleague seconded the motion, a silence that sent the plan to its final vote. Janet Stevens and David Wheeler joined her in opposition. Joseph Kenney and John Stephen voted in favor.

Key-Wallace said his team remains excited about the state’s role in the digital asset economy, and he offered to present the idea to the council in the future.