New Hampshire's Executive Council narrowly rejected a proposal Wednesday that would have authorized a $100 million Bitcoin-backed bond, ending what supporters hoped would make the state a pioneer in digital asset finance, according to Bitcoin Magazine.

The measure failed in a 3-2 vote after reaching its final approval stage, despite receiving a favorable rating review from Moody's and backing from Governor Kelly Ayotte and the New Hampshire Business Finance Authority. Had it moved forward, officials said it would have been the first municipal bond in the world secured by Bitcoin.

The report notes that supporters argued the transaction would not put taxpayers at risk. Instead, it would have connected private investors with a private borrower using Bitcoin as collateral, while allowing the state to collect fees that could fund small business, housing, child care, and economic development initiatives if the deal proved successful.

Skeptics, however, questioned whether New Hampshire should attach its name to a financing structure built around a volatile digital asset. Councilor Karen Liot Hill said she was not opposed to cryptocurrency itself but believed the state should be cautious about endorsing a transaction tied to Bitcoin's price swings.

Business Finance Authority Executive Director James Key-Wallace rejected the idea that Bitcoin remains an "emerging" asset class, arguing it has already established itself in global finance. He also suggested the proposal could have opened the door to similar transactions in the future.

Ayotte, who signed legislation making New Hampshire the first state to authorize a strategic Bitcoin reserve and giving the state treasurer authority to invest in Bitcoin, said pursuing innovative financial structures is worthwhile so long as taxpayers remain protected.

The vote came after Liot Hill unsuccessfully attempted to delay consideration of the proposal. She was joined by Janet Stevens and David Wheeler in opposing the measure, while Joseph Kenney and John Stephen voted in favor.

The decision arrives as Bitcoin and the broader cryptocurrency industry are facing heightened scrutiny. Bitcoin has pulled back from recent highs, while renewed attention has focused on Michael Saylor and Strategy, whose aggressive Bitcoin dividend strategy has drawn increasing debate as the cryptocurrency's price weakens.

That backdrop has put high-profile Bitcoin-related proposals under a brighter spotlight, even as adoption efforts continue at the state and institutional levels.