Moody’s Ratings has assigned a provisional Ba2 rating to up to $100 million in bitcoin-backed taxable revenue bonds expected to be issued by the Business Finance Authority of the State of New Hampshire. The deal, linked to the Waverose Finance Project, stands out because the bonds are supported solely by bitcoin collateral rather than public funds or taxing authority, making it a notable development at the intersection of digital assets and public-sector finance.
According to the rating release, the bonds will be issued in two classes, Series 2026A-1 and Series 2026A-2, both maturing in 2029. The borrower is NH Cleanspark Borrower Trust 2026-1, while the New Hampshire authority acts as lender within the underlying financing structure. Moody’s framed the transaction as a limited-recourse credit, meaning investors depend on the value and orderly liquidation of the pledged bitcoin rather than any broader government support.
How the Bond Structure Works
Each bond class carries a fixed coupon, but the Series A-2 tranche includes an additional feature: holders may receive extra payments at maturity if the value of bitcoin has appreciated since the pricing date. That upside, however, only comes after all required obligations have been fully covered, including principal, interest, and transaction expenses.
This structure is central to the transaction’s risk profile. Moody’s emphasized that the bonds are limited recourse obligations. No New Hampshire public funds stand behind them, and the issuer has no taxing power that could be used to fill a payment gap if the collateral proves insufficient. In practical terms, repayment relies entirely on the proceeds generated from the pledged bitcoin.
That makes the transaction fundamentally different from conventional municipal or authority-backed borrowing. Instead of tax revenue, project cash flow, or a government guarantee, the core support comes from a volatile digital asset whose market value can fluctuate sharply over short periods.
Custody, Liquidation, and Operational Roles
The transaction assigns distinct roles to a number of digital-asset service providers. Bitgo Bank & Trust, National Association will hold the bitcoin collateral in segregated wallets on behalf of bondholders. Bitgo Prime, LLC will act as liquidation agent, responsible for selling BTC if needed to meet payments of interest, principal, and expenses.
For daily operational administration, Wave Digital Assets LLC will oversee routine transaction functions. In addition, RM Digital Finance LLC is expected to be appointed at closing as a backup administrator, a step designed to preserve continuity if the primary administrator can no longer perform its role.
These operational details matter because the credit quality of a bitcoin-backed bond does not depend only on the price of BTC. It also depends on custody safeguards, the ability to liquidate collateral efficiently, and whether counterparties can continue functioning during periods of market stress.
Collateral Triggers and Rating Assumptions
One of the most important features of the deal is its collateral valuation framework. Moody’s said the structure starts with an initial collateral coverage level of 1.60x, alongside a loan-to-value trigger of 1.40x. If the collateral value falls to that trigger threshold, the bonds must undergo a mandatory full redemption.
In assigning the Ba2 rating, Moody’s used an advance rate of 72.06% and assumed a two-day exposure period. The agency said those assumptions are consistent with a Ba2 risk profile and reflect bitcoin’s historical price volatility as well as prevailing market liquidity conditions.
That analysis underscores a core tension in crypto-backed credit products. Bitcoin offers deep liquidity compared with many other digital assets, but its price can still move dramatically in a short window. For any bond structure backed only by BTC, the strength of overcollateralization and the speed of liquidation become essential defenses against market risk.
Dependence on Bitcoin Network and Market Infrastructure
Moody’s also noted that effective liquidation assumes the Bitcoin network remains operational and that related trading and settlement infrastructure continues to function. The agency observed that the network has historically maintained continuous uptime without significant broad-based outages, an important point for a structure that ultimately depends on the transfer and sale of digital assets during potentially stressed conditions.
The methodology used for the rating was Moody’s “Market Value Collateralized Loan Obligations”, published in May 2025. That framework is intended for transactions where collateral value is marked to market and where repayment protection depends on valuation haircuts, trigger thresholds, and liquidation mechanics rather than traditional business cash flows.
In other words, this is not simply a municipal-style bond with a crypto label attached. It is a structured finance product whose rating depends on market-value collateral analysis, even though it is being issued through a state authority vehicle.
What Could Change the Rating
Moody’s said future rating movements could be influenced by several factors, including the performance of the collateral, the issuer’s compliance with transaction documents, and the real-world effectiveness of the liquidation process under stress. A pre-sale report containing additional transaction detail is expected to be published on Moody’s website.
The rating was issued by Moody’s Investors Service, Inc. from its New York office. The release identified Sumeet Sablok as analyst and Leon Mogunov as associate managing director.
Why the Deal Matters
Beyond the immediate credit analysis, the transaction has broader significance for U.S. capital markets. It represents a case in which a state authority is being used to issue publicly offered bonds backed solely by a digital asset. That makes it a notable test of whether bitcoin can serve not just as an investment or treasury reserve asset, but as collateral within a more formal public-finance framework.
Supporters may view the structure as evidence that digital assets are gaining traction in institutional credit markets, especially when paired with established custody arrangements, trigger-based protections, and third-party administration. Skeptics, however, are likely to focus on the same issues Moody’s highlighted: price volatility, execution risk during liquidation, and dependence on crypto market plumbing.
Whether the deal becomes a model for similar financings elsewhere will depend less on symbolism and more on performance. Investors and issuers alike will be watching how the collateral behaves, how the protections work in practice, and whether the structure can withstand periods of sharp market stress without disruption.
For now, Moody’s provisional Ba2 rating suggests that while the transaction includes meaningful safeguards, it still carries material credit risk consistent with a speculative-grade profile. That balance between innovation and caution may define the next phase of crypto-linked structured finance in the United States.