Indicted NYC mayor leaves questionable crypto legacy as controversy mounts

As a seasoned observer of the ever-evolving tech and political landscapes, I find myself intrigued by the rollercoaster ride that is New York City’s crypto-friendly endeavors under Mayor Adams. Having dabbled in the world of blockchain myself, albeit with far less fanfare than our mayor, I can appreciate the potential benefits that a pro-crypto city could bring. However, the legal entanglements that have befallen Mayor Adams serve as a stark reminder that even the most promising initiatives can be derailed by personal circumstances.


3 years prior to the U.S. presidential election where cryptocurrency emerged as a significant topic for the first time, a separate competition related to cryptocurrencies was unfolding in New York City, with candidates vying to replace outgoing Mayor Bill DeBlasio.

In a head-to-head race, Democrats’ nominee Eric Adams is competing against Republican Curtis Sliwa, with both candidates advocating for pro-cryptocurrency mayoral positions. Notably, Adams emerged victorious over fellow crypto supporter Andrew Yang in the Democratic Party primary.

During his election campaign, Adams expressed his intention to establish New York City as a hub for Bitcoins. Following his election as mayor in November 2021, he reiterated his commitment that the city would lead the way in the cryptocurrency industry and advocated for the integration of cryptocurrency education in schools.

Approximately three years into his tenure as mayor, Adams found himself in legal trouble when the Federal Bureau of Investigation indicted him for suspected crimes including bribery, campaign finance irregularities, and conspiracy. The charges stem from alleged illegal activities that are said to have occurred over a nine-year period. Seven top officials in his administration have stepped down, while several others associated with his team have been accused or are believed to be under investigation.

Regarding Adams’ political future and his influence on cryptocurrency in New York City, opinions vary. While his administration emphasizes his accomplishments, those working directly in the field argue that little substantive progress has been made. Meanwhile, members of the cryptocurrency community are growing wary due to Adams’ connection with contentious figures within the industry.

Eric Adams’ record on crypto

Following his victory in the election, Adams engaged in a cordial competition with Miami Mayor Francis Suarez, who vowed to receive an entire salary payment in Bitcoin (BTC). In reaction, Adams declared his intent to accept the first three paychecks in cryptocurrency, which he subsequently did with assistance from Coinbase.

Promise made. Promise kept.

— Mayor Eric Adams (@NYCMayor) January 21, 2022

Every year, elected officials in New York City must submit a financial disclosure form that includes questions about their holdings, such as securities. In his 2023 submission, Adams revealed that he owns Bitcoin worth between $5,000 and $54,999.99, suggesting he has maintained his ownership from his initial earnings, or in other words, he’s still holding onto his Bitcoin.

Indicted NYC mayor leaves questionable crypto legacy as controversy mounts

After assuming office, Adams consistently voiced pro-cryptocurrency views publicly. In June 2022, he spoke out against a two-year ban on new non-renewable energy proof-of-work mining operations in New York that was passed by the State Senate, urging the governor to veto the legislation. Six months later, during the bear market’s lowest point, Adams restated his backing for cryptocurrency advancements despite the declining prices.

Last February 2023, a discussion about blockchain, cryptocurrency, and advanced digital technologies took place during an oversight hearing led by the New York City Council’s Committee on Technology. In this gathering, Matthew Fraser – currently serving as the city’s technology chief, who was appointed by Adams – was present.

Fraser detailed various projects the administration was pursuing, such as implementing educational programs, arranging seminars and functions, and creating a digital wallet specifically for city employees and welfare recipients, which would also support cryptocurrencies. However, at the moment, it remains uncertain whether these initiatives are underway or if there’s a planned launch date for their implementation.

A spokesperson for the City’s Technology and Innovation Office (CTIO) informed CryptoMoon that they are dedicated to implementing new technologies in a responsible manner, with the aim of enhancing public services, streamlining city departments, and ensuring the safety of New York residents.

“We will continue to assess both the practical requirements and risks of blockchain applications in the public sector.”

The spokesperson highlighted the OTI’s planned recruitment of a Digital Assets and Blockchain Policy Advisor in 2024 as evidence of their ongoing commitment. Based on an expired job posting, this advisor’s main duty would be to assist in shaping and executing New York City’s Digital Asset strategy.

During a July 2024 interview on FOX5’s The 5 O’clock News, I was questioned about my stance on Bitcoin. In response, I emphasized that while Bitcoin is one promising avenue, it’s essential to explore other cryptocurrencies and digital payment solutions as well. I referred to these innovations collectively as “cashless wallets.

“There’s so much we can do. We should not be afraid of this new form of paying for goods and services. We should embrace it.”

Is NYC now a Bitcoin city?

Although the Office of Technology and Innovation (OTI) supported the Adams administration’s performance in cryptocurrency matters, not all individuals think he has made a substantial difference on-site. The OTI emphasized that the city focuses on “practical” implementations that ensure the safety of New Yorkers.

We’ll be thoroughly assessing these technologies to ensure they genuinely contribute to the well-being of New York residents, not just follow fleeting trends.” The acceptability of what constitutes reasonable will differ significantly among individuals.

Thomas Pacchia, founder of the New York City-based Bitcoin bar PubKey, mentioned to CryptoMoon that he hasn’t observed anything out of the ordinary since Adams took over. He stated that if there were specific initiatives, they never reached his desk at PubKey or any of the other tasks he has been involved in.

Recently, PubKey garnered attention when Republican presidential candidate Donald Trump dropped by for a meal and utilized the Bitcoin Lightning Network to settle his bill. This establishment is known for welcoming politicians from both the Republican and Democratic parties, who frequent it to educate themselves about Bitcoin, blockchain technology, or to support events advocating pro-cryptocurrency policies. Nevertheless, as stated by Pacchia:

“We never heard anything from his office, from the mayor’s office, which I think sort of speaks volumes.”

One challenge encountered within urban settings is that even if a mayor’s office shows support for cryptocurrencies, the city remains subject to state regulations. Notably, New York State is known for having some of the most stringent oversight in the United States regarding cryptocurrencies.

Indicted NYC mayor leaves questionable crypto legacy as controversy mounts

The Attorney General’s Office has taken legal action against Gemini, KuCoin, and Tether, while firms seeking to provide digital asset services must go through the rigorous and costly process of applying for and obtaining a BitLicense, as mandated by the Department of Financial Services.

The BitLicense regulatory framework in New York has faced widespread criticism from cryptocurrency ventures and innovators, often serving as a point of contention. As Pacchia puts it, the strict regulations make it nearly impossible for Bitcoin-related businesses to seriously consider operating within New York state.

“It’s unfortunate anytime you see a term of service or something like that to have New York state listed alongside North Korea and Iran and other sanctioned countries — do not use this if you’re based in New York state.”

Julie Samuels, the president and CEO of Tech:NYC (a nonprofit group advocating for tech-friendly policies), explained to CryptoMoon that New York’s stringent licensing system for virtual currency businesses is intended, in part, to build consumer trust. Surprisingly, this could potentially have a significant positive impact on the cryptocurrency sector within New York, as it makes New York the first state to establish clear guidelines for companies to follow, thereby setting the roadmap for the industry.

It’s been evident that the lengthy process of obtaining a license and intermittent availability of personnel at the Department of Financial Services to prospective applicants has significantly hindered the expansion of the cryptocurrency industry. This, in turn, has diminished the economic contribution crypto companies could make for the state.

The solution to make NYC truly a crypto-friendly city is very straightforward, according to Pacchia: “Throw out the BitLicense.” He acknowledged that Adams alone doesn’t have this power, “but being the mayor of New York, that’s a pretty big podium to start to make progress with common sense and practical pieces of regulation.”

The future of Adams’ pro-crypto policies if he leaves office

In light of Mayor Adams’ ongoing legal troubles, it’s uncertain what the future holds for him. So far, he has dismissed requests for his resignation and declared that he will vigorously defend himself against the accusations, using all his physical and mental strength. On October 9th, he reaffirmed his intention to not step down and even announced his plans to run for reelection in 2025. If found guilty, he could potentially face up to 45 years behind bars.

As an analyst, I find myself pondering over the potential scenarios surrounding Adams’ tenure as mayor. The state governor, Kathy Hochul, holds the authority to potentially oust him, yet she has shown no signs of doing so thus far. Additionally, there exists a special “committee on mayoral inability” that could potentially remove him from office. In case Adams steps down or is removed, New York City’s public advocate, Jumaane Williams, would temporarily take charge, and a special election would ensue to elect a new mayor.

Williams was unable to dismiss any of Adams’ appointees, including the pro-cryptocurrency Chief Technology Officer Fraser, meaning that the city’s blockchain projects are unlikely to be terminated immediately. However, whoever takes over from Adams will have the authority to accelerate, reduce, or maintain these initiatives in the long run.

Regardless of which route he chooses, Adams will likely encounter a challenging climb in the 2025 elections. If successful, it might lead to his proposed policies being discarded.

The promises and risks of politicians

As a researcher delving into the world of politics and cryptocurrency, it’s evident that Adam isn’t alone when it comes to notable pro-crypto figures grappling with criminal charges. Amongst them, none are more prominent than Trump, who is currently entangled in four distinct legal battles.

As an analyst in the cryptocurrency sector, I find myself growing concerned about the increasing links between our industry and questionable political figures. Recently, Ethereum co-founder Vitalik Buterin sparked debate when he suggested that voters should not blindly support a candidate solely based on their stance towards crypto. Instead, he emphasized the importance of evaluating a candidate’s overall policy positions.

Approximately two weeks elapsed, and then National Security Agency whistleblower Edward Snowden voiced similar thoughts, addressing attendees at the Bitcoin 2024 conference by advising them to “exercise your right to vote, but refrain from becoming blind followers of any group.

From the case of Mayor Adams, we might infer that voting for a candidate who supports cryptocurrency could potentially lead to the adoption of crypto-friendly measures, even if it’s not certain that such a politician will always deliver on each specific pledge regarding this topic.

Instead, it’s important to acknowledge that individuals generally have limitations when working alone. Not even the President can perform many desired actions without seeking assistance from Congress.

Adams serves as a reminder that even if an elected official is supportive of cryptocurrency in their policies, they still carry any baggage they may have with them to the office. Their other unrelated leadership choices might be highly contentious or widely criticized.

In simple terms, a survey conducted by Quinnipiac University in December 2023 showed that Adams was the least favored New York City mayor since polling started in 1996. On the other hand, a Marist poll carried out in October 1 suggested that about 69% of registered voters believe Adams should step down from his position.

Although blockchains such as Bitcoin are specifically designed to prevent any single leader, be it a mayor or president, from controlling their course in the future. Consequently, it might bring some reassurance that regardless of the actions taken by politicians and elected officials, whether they embrace the crypto sphere or not, their sentiments towards it – be they favorable or unfavorable – the nature of cryptocurrency will persist in its operation, much like it has been doing all along.

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2024-10-19 16:17