New Hampshire has approved a $100 million municipal bond backed by Bitcoin, establishing the first US state-level Bitcoin-backed municipal bond, according to Crypto In America.

The initiative follows New Hampshire’s move earlier in the year to allow its treasury to invest up to 5% of public funds in digital assets, establishing the nation’s first Strategic Bitcoin Reserve. Governor Kelly Ayotte and state lawmakers see the bond as a way to test Bitcoin as high-grade collateral under traditional municipal finance rules.

Fees and potential gains from the collateral will support the state’s Bitcoin Economic Development Fund. If successful, the structure may pave the way for the adoption of crypto-backed debt products.

The development showcases nationwide financial innovation as municipalities explore alternative funding mechanisms for public financing.