The New Hampshire Business Finance Authority is set to issue what appears to be the first bitcoin-backed rated bond of its kind, marking a step toward integrating crypto into traditional public finances.
The bonds received a provisional Ba2 rating from Moody’s Ratings, two notches below investment grade. They will be issued through the Business Finance Authority of the State of New Hampshire and are backed by Bitcoin. held as collateral, according to a press release.
“The rated bonds will be collateralized by a loan…backed by Bitcoin, a digital currency,” Moody’s said in its report.
The structure is based on Bitcoin rather than a company’s cash flow. Bondholders are reimbursed through the liquidation of BTC held by BitGo, which will be sold if necessary to pay interest and principal. The deal includes safeguards common in structured credit, including 1.6x overcollateralization and triggers that force liquidation if the loan-to-value ratio deteriorates.
Moody’s said its rating reflects “risks associated with the collateral, structure and operation of the transaction,” including the volatility of Bitcoin. The agency used a 72% advance rate and short liquidation windows to model potential bearish scenarios.
The bonds are limited recourse, meaning no public funds are at risk. “No public funds of the State of New Hampshire…may be used to pay any amounts under the rated obligations,” Moody’s said.
This distinction is important. Although the agreement uses state authority, it does not have state credit support. Instead, it looks like conduit or project financing, where the issuer serves as a conduit.
Nonetheless, the structure places Bitcoin in a part of the financial system where it has rarely appeared: rated debt issued through public channels.
The Ba2 rating places bonds in the speculative category, but also signals that credit agencies are developing frameworks to evaluate cryptocurrency-backed instruments.
The deal comes as institutions continue to test ways to use bitcoin beyond trading or cash holdings. The Labor Department on Monday proposed a rule following an executive order from President Donald Trump that directed regulators to expand access to digital assets in retirement wallets, marking another step in that direction.
