TLDR
- The New Hampshire Executive Council voted 3-2 to reject the proposed $100 million Bitcoin-backed municipal bond.
- The proposal would have become the world’s first municipal bond backed by Bitcoin if it had received final approval.
- State officials said the financing structure would not have exposed taxpayers to losses because it linked private investors with a private borrower.
- Governor Kelly Ayotte supported the proposal and said innovation should continue while protecting public funds.
- Business Finance Authority Executive Director James Key-Wallace said the agency may present the Bitcoin-backed bond proposal again in the future.
New Hampshire officials rejected a proposed $100 million Bitcoin-backed municipal bond after a divided council vote Wednesday. The 3-2 decision ended a financing effort promoted as the first municipal bond secured by Bitcoin. New Hampshire had positioned the proposal as a potential route for attracting digital finance activity.
New Hampshire Council Rejects Crypto Financing
The Executive Council held final authority over the bond after the proposal completed earlier financial reviews. Three councilors opposed the measure, while Joseph Kenney and John Stephen supported its approval. The vote stopped the New Hampshire Business Finance Authority from moving forward with the planned issuance.
Karen Liot Hill, the council’s only Democrat, questioned the state’s role in validating a volatile asset-linked transaction.
“I’m not opposed to Bitcoin or cryptocurrency in general,” she told The Boston Globe.
She said New Hampshire would lend legitimacy to an asset class with a record of major price swings.
Liot Hill first sought to table the measure, but no other councilor supported that procedural request. Janet Stevens and David Wheeler then joined her in voting against the proposal. Their votes produced the majority needed to block the bond before issuance.
Authority Describes Private Financing Structure
The New Hampshire Business Finance Authority designed the bond as a conduit between private lenders and a private borrower. Bitcoin would have secured the financing, but the state would not guarantee repayment. Authority officials said taxpayers would carry no obligation if the collateral lost value.
Executive director James Key-Wallace challenged descriptions of cryptocurrency as an emerging asset class. “The only quibble I would have is … I wouldn’t call them ’emerging,’” he said. “They’ve ’emerged.’ They’re here,” he added while defending the proposed structure.
The three-year arrangement could have generated fees if Bitcoin increased in value during the bond term. The authority planned to direct potential revenue toward housing, child care, small businesses, and development programs. Key-Wallace also said the New Hampshire transaction could have created a model for additional deals.
State’s Digital Asset Policy Continues
Governor Kelly Ayotte supported the bond and argued that innovation could proceed without exposing taxpayers. She said New Hampshire thrives when officials pursue new ideas while protecting public finances. However, the Executive Council’s rejection prevented the administration from testing that approach through the proposed bond.
Ayotte previously signed legislation allowing the state treasurer to consider Bitcoin investments under defined authority. That law made New Hampshire the first state to establish a statutory strategic Bitcoin reserve framework. The bond proposal represented a separate financing effort rather than a direct state purchase.
Key-Wallace said the authority remains interested in the state’s broader digital asset economy after Wednesday’s defeat. He also offered to bring the concept back before the council at a later date. For now, New Hampshire has ended the proposed $100 million Bitcoin-backed municipal bond without approving its issuance.
