en.bitcoinsistemi.com
Another first is happening for Bitcoin in the US. According to Bloomberg, the New Hampshire Business Finance Corporation in New Hampshire is preparing to issue the first-of-its-kind rated Bitcoin ($BTC) backed bond, as a step towards integrating cryptocurrencies into traditional public finance.
Accordingly, the New Hampshire Business Finance Corporation plans to issue approximately $100 million worth of Bitcoin ($BTC)-backed bonds.
The bonds were provisionally rated Ba2 by Moody’s, two notches below investment grade. This marks the first time the agency has rated a Bitcoin-backed bond.
According to the announcement, the bonds will be issued through the New Hampshire State Business Finance Authority and will be backed by Bitcoin.
Moody’s stated in its report, “The rated bonds will be secured by a loan backed by the digital currency Bitcoin.”
Additionally, the bonds are backed by Bitcoins held by BitGo, with BitGo acting as custodian and keeping the Bitcoin collateral in separate wallets.
BitGo will act as a custodian and exchange agent responsible for converting these Bitcoins into cash when necessary to meet interest and principal payments.
Although these bonds are issued through a public authority, they are structured under the principle of limited liability. This means that repayment will only be covered by proceeds from Bitcoin collateral, and public funds cannot be used for repayment. In short, the bonds will not be backed by the state’s credit or tax authority.
At this point, Moody’s stated, “None of the state of New Hampshire’s public funds can be used to pay the amounts under the Bitcoin-backed rated bonds.”
It has been reported that the official release date of the bonds has not yet been determined.
*This is not investment advice.