New Hampshire's Executive Council has rejected the $100 million Bitcoin bond proposal in a 3-2 vote, ending the state's groundbreaking effort to establish what would have been the first rated, government-backed Bitcoin-backed bond. The council's decision came during its July 8 meeting, with the vote representing the final step in the project's review process. As reported by crypto.news, three council members voted against the proposal, while two supported it, with the decision blocking the final state approval required for the New Hampshire Business Finance Authority to proceed with the transaction. Keith Ammon, a longtime crypto advocate and majority floor leader in the New Hampshire House of Representatives, called the decision "extremely short-sighted" on social media platform X, stating that council members should gather all relevant facts and information before reconsidering at a future meeting. Ammon noted that it's an election year for council members, and it only takes one to swing the vote, adding "We're not giving up."
New Hampshire's $100 million Bitcoin bond proposal faced a significant liquidation trigger that could have determined the experiment's outcome. According to recent research, Bitcoin's winter drawdown cut its price by more than half, creating a 12.5% slide that has erased the required buffer for mandatory liquidation. The deal entered mandatory liquidation after this price movement, with the critical threshold being a 140% coverage ratio that Bitcoin's recent volatility had easily surpassed. As reported by The Boston Globe, David Krause, an emeritus finance professor at Marquette University, modeled the structure and found that historical Bitcoin swings were highly likely to trigger the liquidation mechanism. Bitcoin peaked above $126,000 in October 2025, then slid to just above $60,000 by February, demonstrating the volatility that could have triggered the liquidation mechanism.
The proposed taxable revenue bonds would have supported NH CleanSpark Borrower Trust 2026-1, a New Hampshire investment trust tied to Bitcoin acquisition. As reported by the council's agenda, proceeds would have been used by the trust to finance Bitcoin purchases and cover expenses linked to issuing the bonds. CleanSpark planned to post about $160 million in Bitcoin as collateral for bonds worth up to $100 million, with the parties planning to hold the Bitcoin in segregated wallets managed by BitGo. Governor Kelly Ayotte backed the plan after the BFA approval, stating that "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 BFA has framed the plan as a Bitcoin-backed municipal bond that does not rely on state funds, with the authority acting as a facilitator while the private borrower carries repayment duties. BitGo Trust Company would have served as the custodian for the Bitcoin collateral, holding assets in regulated cold storage, while fees from the deal would have supported a Bitcoin Economic Development Fund.
Moody's assigned the proposed bond a provisional Ba2 rating in March, which falls below investment grade and points to credit risk tied to the structure. The rating also showed how traditional credit markets are trying to price Bitcoin collateral, with the bond relying on overcollateralized Bitcoin where borrowers are expected to post about 160% of the bond's value in BTC. The three-year notes rely on BitGo Trust Company to custody the collateral in cold storage and execute any liquidation. If the coverage ratio falls to 140%, mandatory liquidation and early redemption follow, with recent Bitcoin history showing how easily this threshold can be breached. David Krause noted in an April analysis that "While the bond may serve as a proof of concept for integrating digital assets into structured finance, it is not well suited as a general-purpose public finance tool."
The rejected bond proposal follows New Hampshire's wider push into digital asset policy, with the state becoming the first U.S. state to approve a strategic Bitcoin reserve law in 2025. The law allows the state to invest up to 5% of public funds in eligible digital assets with a market cap above $500 billion. The rejected bond would have marked another step in the state's attempt to connect public finance with Bitcoin, though the council's decision has ended this particular experiment. New Hampshire also became the first U.S. state to authorize a strategic cryptocurrency reserve, with its law allowing the state treasurer to invest a limited share of eligible public funds in qualifying digital assets. The failed bond vote does not reverse that reserve law, which applies only to the CleanSpark-linked conduit bond proposal presented to the Executive Council. New Hampshire has led among states establishing crypto policies, becoming the first to establish a crypto reserve last year — well ahead of the yet-unfinished federal effort.
