New Hampshire’s Executive Council is holding a public hearing this Wednesday on $100 million in bonds financing private Bitcoin (BTC) purchases. Approval would clear the last governmental hurdle for the first municipal bond collateralized by Bitcoin.
However, Bitcoin’s winter drawdown cut its price by more than half. This deal enters mandatory liquidation after a roughly 12.5% slide. That gap, rather than the vote, may decide how the experiment ends.
New Hampshire Bitcoin Bond Takes the Conduit Route
The New Hampshire Business Finance Authority (BFA) requested the hearing under state statute RSA 162-I. Executive Director James Key-Wallace asked Governor Kelly Ayotte and the five-member council to determine whether the project is feasible and beneficial.
If approved, the BFA will issue taxable conduit revenue bonds, meaning the state will facilitate the loan but never borrow. It will lend the proceeds to NH CleanSpark Borrower Trust 2026-1, tied to CleanSpark, the Nevada-based miner still absorbing steep first-quarter losses. Jefferies will underwrite the deal, which Wave Digital Assets designed.
Repayment falls entirely on the borrower, so taxpayers carry no direct exposure. Meanwhile, the BFA earns its fee in Bitcoin, seeding a planned Bitcoin Economic Development Fund.
House Bill 302, signed in May 2025, made New Hampshire the first state to let its treasurer hold digital assets. In contrast, the federal Strategic Bitcoin Reserve remains tangled in legal questions.
Why the 140% Liquidation Trigger Worries Researchers
Moody’s assigned the bonds a provisional Ba2 rating on March 31. That mark sits two notches below investment grade, in the tier commonly called junk bonds. The three-year notes rely on BitGo Trust Company to custody the collateral in cold storage and execute any liquidation.
CleanSpark must post $160 million in Bitcoin against $100 million of obligations, a 160% coverage cushion. If that ratio falls to 140%, mandatory liquidation and early redemption follow. All else equal, a 12.5% price drop erases that buffer.
New Hampshire Bitcoin bond collateral structure and the 140% liquidation trigger. Source: BeInCrypto
Recent history clears that bar easily. Bitcoin peaked above $126,000 in October 2025, then slid to just above $60,000 by February. Meanwhile, record miner BTC sales showed how fast the industry converts coins to cash under stress.
David Krause, an emeritus finance professor at Marquette University, modeled the structure. He found that historical Bitcoin swings were highly likely to trigger the trigger, the Boston Globe reported.
“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.”
Wednesday’s outcome appears predictable, since the BFA board approved the framework on November 18.
New York City rejected a similar pitch over tax law concerns, per law professor Tonya Evans.
Therefore, the harder test comes in the market, where investors must price junk-rated bonds against Bitcoin’s near-term price outlook.
