This month, New Hampshire has made history by becoming the first state in the United States to give its treasury the green light to invest in cryptocurrency. The newly enacted legislation, which advocates are dubbing a “state bitcoin reserve,” is fairly limited in scope. It allows, but does not mandate, the state treasurer to allocate up to 5% of state assets into bitcoin and gold. This initiative is part of a larger movement led by State House Republicans aiming to position New Hampshire as an appealing environment for cryptocurrency investors and developers, facilitating activities like mining and legal resolutions.
New Hampshire: The ‘Granite Cradle of Crypto’
“I believe New Hampshire truly deserves the title of ‘the granite cradle of crypto,’” stated Eric Brakey, Executive Director of the Free State Project, highlighting the support behind this initiative. The movement is driven by a mix of enthusiasm for cryptocurrency and an anti-regulatory stance promoted by lawmakers and activists with libertarian views, many of whom are affiliated with the Free State Project. This push coincides with former President Trump’s strong advocacy for cryptocurrency, including the launch of his own digital currency earlier this year.
Aiming to Become the Next Delaware
In New Hampshire, key advocates, including House Majority Leader Jason Osborne, view cryptocurrency as a pathway to transform the state into a thriving hub for economic growth. “Essentially, we aim to replicate Delaware’s success,” Osborne remarked last week, referencing Delaware’s longstanding reputation as the incorporation destination for over half of Fortune 500 companies. His comments came during an interview on X, which also included Brakey and Rep. Keith Ammon, the primary author of the new legislation. The discussion was moderated by local bitcoin investor Bruce Fenton and featured Dennis Porter from the Satoshi-Action Fund, a national organization that promotes pro-crypto legislation.
Legislative Efforts and Local Advocacy
“We hope that New Hampshire’s leadership can serve as a model for other states,” Porter expressed. While the focus of the conversation largely centered around cryptocurrency, it also felt like a celebration for the Free State Project, the libertarian group that encouraged many cryptocurrency enthusiasts, including Fenton, Brakey, Osborne, and Ammon, to relocate to New Hampshire. “This is our home, our chosen home. It’s where we intend to stay, and we need to take care of it,” Ammon stated, reflecting his commitment to advancing legislation in Concord. “We’re adopting a ‘New Hampshire first’ mindset.”
Preventing Discrimination Against Digital Assets
Although the bill allowing state investment in cryptocurrency garnered national attention last week, several other pro-crypto legislative proposals are currently under consideration in the New Hampshire State House this session. One such bill, championed by Ammon as an “anti-discrimination” initiative, seeks to ensure the state cannot ban the use of digital assets. It would also prevent governmental entities from imposing specific regulations on blockchain enterprises. The bill has faced opposition from environmental groups concerned about the energy consumption and noise pollution associated with bitcoin mining.
Legal Definitions and Regulatory Challenges
This proposal would introduce new legal definitions for various blockchain-related terms and establish a special docket within the judicial system to handle blockchain-specific disputes. Additionally, it asserts that businesses involved in cryptocurrency “mining” and “staking” are not engaging in activities classified as securities or investment contracts—a change that has drawn criticism from state securities regulators. “From our perspective, this could hinder our ability to safeguard New Hampshire investors,” remarked Katie Taylor, an attorney from the state securities bureau, during a recent Senate committee meeting.
Exploring New Avenues for Blockchain
Another significant bill under consideration would create a commission to study various blockchain concepts. Topics of exploration would include stable tokens, which are digital assets tied to the value of a commodity or currency, and the tokenization of real-world assets like real estate, artworks, or even wine. The commission would also look into the potential for creating blockchain-based trusts.
Legislative Proposals on Energy Production
In addition to these measures, there are legislative initiatives aimed at enhancing energy production that Republicans believe will benefit the local cryptocurrency landscape. One proposal aims to classify “off-grid electricity providers” as entities that generate, transmit, or sell electricity independently of existing systems, granting them exemptions from most state utility regulations. Another bill would allow electric utilities to own and manage “advanced nuclear resources” for the purpose of powering cryptocurrency mining operations. However, the timeline for any modular nuclear projects remains uncertain, with expectations for completion in other states by 2030.
The Need for Regulatory Frameworks
The future of New Hampshire’s cryptocurrency-related legislation is still unclear. Governor Kelly Ayotte, who joined Osborne and Ammon for a photo opportunity during the signing of the state “crypto reserve” bill, underscored the importance of regulation regarding blockchain currencies. “While we welcome economic activities associated with crypto, it is essential to have appropriate guardrails in place,” Ayotte commented to reporters. Bill Ardinger, a Concord attorney and tax specialist who previously led Governor Chris Sununu’s Commission on Cryptocurrency and Digital Assets, echoed this sentiment of caution. “Blockchain represents a genuine technological advancement, but practical applications will only flourish with a robust legal framework from federal and state governments,” Ardinger noted.
A Promising Future for Cryptocurrency in New Hampshire
The specific contours of that policy framework—both in New Hampshire and across the nation—remain to be determined. However, proponents of cryptocurrency in Concord are optimistic about the potential. “The opportunities we’re creating for new energy production and financial institutions will make this a vibrant place,” Osborne asserted. In many respects, this dynamic seems to be already unfolding. Recently, state banking regulators granted a charter to Singapore-based Crypto.com, allowing the company to operate as a non-depository trust company in New Hampshire, tasked with managing assets for its American and Canadian clientele.
Reflecting on the Early Days of Cryptocurrency
For New Hampshire’s cryptocurrency advocates, these latest developments represent a significant shift from their initial experiences with digital currencies. During a recent discussion on X, Fenton, Osborne, and Ammon reminisced about first encountering bitcoin at Free State Project events like Porcfest, when bitcoin was worth only a fraction of its current value, trading for more than $100,000 per coin today. “I distinctly remember buying a bag of ice with a bitcoin once,” Osborne recounted. “I also recall purchasing a bottle of mustard for a bitcoin.”
