New Hampshire: A Pioneer in U.S. Crypto Assets Regulation

1. Introduction

New Hampshire is known for its beautiful natural scenery, especially the White Mountains, the Lakes Region, and the autumnal maple leaf views. As an important participant in the American Revolutionary War, the state is widely known for its motto "Live Free or Die." Today, New Hampshire is once again taking on a pioneering role, promoting the broader acceptance of Crypto Assets across American states. In May 2025, the state became the first in the nation to establish a Bitcoin reserve through legislation.

Prior to this, New Hampshire gained widespread acclaim from the Crypto Assets industry for its friendly tax policies. This article will delve into the state's tax system, particularly the tax regime related to Crypto Assets, as well as recent developments in Crypto Assets regulation.

2. The Basic Tax System of New Hampshire

2.1 Overview

New Hampshire has a relatively friendly tax system, making it an ideal place for individuals seeking low tax burdens in the United States. The state's tax regime is quite favorable for high-income earners, business owners, and wage earners. As one of the few states in the U.S. that does not impose personal income tax, sales tax, or capital gains tax, New Hampshire is highly attractive to taxpayers. However, the state's tax burden is primarily shifted to other tax types, particularly property tax, which can place a heavier burden on landlords and tenants. Nevertheless, overall, New Hampshire's tax system still holds a competitive position within the United States, characterized by its simplicity, economic freedom, and high transparency.

The New Hampshire Department of Revenue Administration is responsible for the collection and management of various taxes, and ensures that taxpayers fulfill their obligations through audits, investigations, and other means. At the same time, the department also oversees the collection of municipal taxes to ensure fairness and compliance with state laws.

2.2 Main Tax Types

2.2.1 Business Operation Tax

The business profits tax is one of the major taxes in New Hampshire, levied based on the value of business entities including compensation, interest, and dividends paid, with a tax rate of 0.55%. This is a distinctive component of the state's tax structure. In short, the business profits tax is measured according to the scale of business operations, which is different from another major tax in the state, the business income tax, which is levied based on net profits of the business.

The business operation tax applies to business entities such as joint-stock companies, limited liability companies, partnerships, and sole proprietorships with total revenue exceeding $277,000 or a business value tax base exceeding $111,000. Regardless of whether the business is profitable, as long as these thresholds are met, the tax must be paid.

2.2.2 Corporate Profit Tax

The corporate profits tax is an important source of fiscal revenue and one of the main tax types for the New Hampshire government, equivalent to the state-level corporate income tax, which taxes the net profits earned by businesses from income obtained within the state.

This tax applies to entities such as corporations, limited liability companies, partnerships, and sole proprietorships, and in certain circumstances, also includes trusts and estates. The applicable entities are those operating in New Hampshire with an annual gross revenue exceeding $92,000.

Currently, the corporate profits tax rate is 7.5% of taxable net profits, down from the previous 8.5%. This is one of the results of the state's ongoing tax reforms. Compared to other states, New Hampshire has a lower corporate profits tax rate and employs a simplified calculation method closely tied to federal tax filings.

2.2.3 Property Tax

Property tax is the main type of tax and a major source of revenue for residents of New Hampshire. The state compensates for its lack of personal income tax and sales tax with high property taxes, making its per capita property tax burden one of the highest in the nation. New Hampshire imposes an effective tax rate of 1.41% on owner-occupied properties, generating approximately $360 million in revenue in 2024, which is an increase of 38.3% compared to the previous fiscal year.

Property taxes in New Hampshire are the responsibility of local governments, with tax collection and management executed by municipal and town-level local governments. Each town manages its taxes according to its own budgetary needs, which means that tax rates may vary depending on the locality.

Although the tax is levied at the town level, the state tax authority conducts a rate balancing assessment to ensure that the tax rates across various towns are fair and uniform. Factors considered in the assessment include municipal budgets, local education budgets, and voter decisions.

Property tax applies to various real estate, including residential land, commercial land, industrial land, and the buildings on them. At the same time, it also applies to "current land", but open spaces and agricultural land can obtain certain tax reductions.

2.3 New Hampshire's Crypto Assets tax system

New Hampshire has not yet established a specific tax framework for Crypto Assets trading or other related activities. However, Crypto Assets businesses or other economic entities operating in the state may still be subject to other taxes as mentioned earlier, such as corporate profits tax, business operating tax, and property tax. The state's lack of a specific tax for Crypto Assets may be related to its absence of personal income tax and sales tax, or it may be a deliberate effort to position itself as a crypto-friendly jurisdiction.

This tax system has brought convenience to the business operations and tax burden assessment of encryption enterprises. In addition, the existing tax framework has made New Hampshire an ideal area for encryption enterprises to develop products and obtain a larger proportion of revenue. In other states, these revenues might incur more tax burdens.

From a broader perspective, the system of not levying personal income tax or capital gains tax means that residents can retain most of the income earned through Crypto Assets trading or other forms. Moreover, New Hampshire's overall low tax burden environment allows Crypto Assets companies to fully utilize the existing system to expand their business while minimizing their tax burden. The state may also undergo more liberal tax reforms in the future to alleviate the existing tax burden and introduce incentives to further encourage the development of the Crypto industry in the state.

3. Future Development Trends of Crypto Assets Regulation in New Hampshire

Since 2024, New Hampshire has taken several legislative actions aimed at providing a legal framework for blockchain or Crypto Assets related activities and positioning the state at the forefront of Crypto Assets application and development. Last year, the state introduced the "Decentralized Autonomous Organization Act" to regulate decentralized autonomous organizations operating in the state. This legislation aims to provide guidance on governance, restructuring, and other matters, and grants legal recognition to blockchain organizations, encouraging them to establish, expand, or relocate their operations in New Hampshire.

In May 2025, the Governor of New Hampshire officially announced that the state would establish a "Strategic Bitcoin and Digital Asset Reserve Fund," allowing the state treasury to invest up to 5% of public funds in digital assets with a market capitalization exceeding $500 billion (currently only Bitcoin meets this standard), while the total biennial budget of New Hampshire is $151.7 billion, of which 5% is $7.85 billion. The signing of this bill marks the first time a local government in the United States has legally recognized the reserve asset property of Bitcoin, providing a template for legislative practices in other states. However, the bill does not mandate investment but merely grants the state treasury the right to invest.

In addition to the recently passed legislation, there is another House bill (No. 639) proposed in 2025 that is currently under consideration. It aims to provide more protection for crypto assets miners, and if passed, it will reduce the regulatory burden imposed by state and local governments on cryptocurrency mining activities, thereby granting greater freedom to practitioners in this field. Furthermore, the bill may also protect mining companies from being prohibited by local governments on grounds of noise, energy consumption, or other reasons. The potential impact of this bill should not be underestimated, as it addresses some of the key challenges currently faced by cryptocurrency miners in the United States, including issues related to noise and energy usage from mining facilities. The bill will also negate the power of local governments to prevent people from using crypto assets to purchase goods and services. However, the bill is still pending approval from the House, and the state Senate has decided to pause the legislative process to allow for more debate time. Meanwhile, the Senate is also reviewing certain provisions of the bill, particularly those that propose not classifying crypto assets as securities or investment contracts. This regulatory initiative aims to diversify the state's investment portfolio, reflecting the growing recognition of digital assets at the institutional level.

4. Summary

The progress of cryptocurrency regulation in New Hampshire and the broad acceptance of cryptocurrency activities reflect positive expectations in the cryptocurrency market. Although it is currently difficult to fully assess the effectiveness of the new legislation in New Hampshire, it is certain that the state's supportive stance towards cryptocurrency is likely to strengthen further in the coming years.

From a broader perspective, New Hampshire may once again play a leading role, encouraging other states in the U.S. to more actively embrace Crypto Assets. Its potential impact will be the emergence of more crypto-friendly jurisdictions in the U.S., thereby creating an increasingly expanding whitelist for Crypto Assets, providing investors and developers with more ideal locations to establish and operate Crypto businesses without regulatory suppression or restrictions.

For New Hampshire, investing in Bitcoin is a way to diversify its reserves and bring considerable investment returns. At the same time, the state's supportive stance on Crypto Assets and low tax environment are expected to attract a large influx of crypto enthusiasts and developers, seeking favorable ground for developing innovative projects or obtaining higher returns.