Moody's Ratings has assigned a temporary Ba2 rating to up to $100 million in bitcoin-backed taxable revenue bonds issued by the New Hampshire Business Finance Authority. The bonds are part of the Waverose Finance project and are fully collateralized by bitcoin, with no state tax or public funds backing them.
Bond Structure and Key Terms
The offering is divided into two series: Series 2026A-1 and Series 2026A-2, both maturing in 2029. Each class carries a fixed coupon. Holders of Series A-2 bonds may also receive additional payment at maturity if the price of bitcoin has increased since the pricing date, but only after all principal, interest, and fees have been fully paid. The borrower is NH Cleanspark Borrower Trust 2026-1, and the state authority acts as the fronting lender in the underlying loan structure.
Collateral management is handled by Bitgo Bank & Trust, National Association, which will hold the bitcoin in a segregated wallet on behalf of bondholders. Bitgo Prime, LLC serves as the liquidation agent, responsible for selling BTC to cover interest, principal, and fees when needed. Wave Digital Assets LLC manages day-to-day transaction administration, while RM Digital Finance LLC is slated to be appointed as a backup administrator to keep operations running if Wave Digital steps back.
Collateral Valuation and Triggers
The deal includes a collateral valuation mechanism tied to loan-to-value (LTV) thresholds. The initial coverage is set at 1.60x, with an LTV trigger at 1.40x. If the collateral value falls to that trigger point, a mandatory full redemption of the bonds is required. Moody's used a 72.06% drawdown rate and a two-day exposure period in its analysis, both consistent with the Ba2 rating. These figures reflect Bitcoin's historical price volatility and market liquidity conditions.
The rating agency acknowledged that effective liquidation depends on the Bitcoin network continuing to operate and the market infrastructure remaining functional. The network has historically maintained sustained uptime without significant major disruptions. The methodology applied is Moody's Market Value Collateralized Loan Obligations methodology, published in May 2025.
Rating Sensitivities and Market Significance
Factors that could affect the rating include changes in collateral performance, the issuer's compliance with transaction documents, and how well the liquidation mechanism holds up under stress. A pre-sale report with additional transaction details is expected to be published on Moodys.com.
This transaction marks a pivotal moment in U.S. municipal finance, where a state authority uses digital assets as the sole collateral for publicly issued bonds. Whether this paves the way for similar structures elsewhere will depend on the performance of this structure. The bondholders rely entirely on the bitcoin collateral, with no recourse to New Hampshire taxpayers or taxing power.