Three years before cryptocurrencies first became a talking point in the U.S. presidential election, another cryptocurrency-focused race was taking place in New York City to determine who would replace outgoing Mayor Bill DeBlasio.
Democrat Eric Adams faced Republican Curtis Sliwa, and both campaigned on promises to be pro-cryptocurrency mayors. Adams recently defeated Andrew Yang, another cryptocurrency advocate, in the Democratic primary.
On the campaign trail, Adams promised to make NYC “the epicenter of Bitcoin.” After being elected mayor in November 2021, he continued to pledge that the city would become a “hub for the cryptocurrency industry” and insisted that cryptocurrencies be taught in schools.
Nearly three years after being elected mayor, Adams was indicted by the Federal Bureau of Investigation and charged with “bribery, campaign finance and conspiracy offenses” related to alleged criminal activity spanning nearly a decade. Seven high-ranking officials have resigned from his administration, and several other officials linked to his administration have reportedly been indicted or are under investigation.
Now, with his political career at risk, whether Adams has had a positive impact on cryptocurrency in NYC depends on who you ask. His administration has defended his record, but people on the ground say it hasn’t really had any impact. At the same time, many in the cryptocurrency community are increasingly concerned about the industry’s association with controversial figures like Adams.
Eric Adams’ Cryptocurrency History
After winning the election, Adams entered into a friendly rivalry with cryptocurrency-friendly Miami Mayor Francis Suarez, who promised to have one of his salaries 100% in Bitcoin (BTC). In response, Adams said he would receive his first three paychecks in cryptocurrency. He later fulfilled this promise with the help of Coinbase.
The promise has been fulfilled. The promise was kept. pic.twitter.com/rSafDZDViN
— Mayor Eric Adams (@NYCMayor) January 21, 2022
New York City elected officials are required to fill out a financial disclosure form each year that asks things like whether they own securities. In a 2023 disclosure, Adams said he held between $5,000 and $54,999.99 worth of Bitcoin. So he appears to be holding on to his first paycheck.
Eric Adams reported Bitcoin holdings as of the end of 2023. Source: NYC Conflicts of Interest Commission
Adams also continued to publicly voice his support for cryptocurrencies after taking office. In June 2022, he criticized a two-year moratorium on new non-renewable energy proof-of-work mining operations in New York passed by the state Senate, reportedly asking the governor to veto the bill. Six months later, with the bear market deepening, Adams reiterated his support for cryptocurrency innovation despite falling prices.
In February 2023, the New York City Council’s Technology Committee held an oversight hearing to discuss blockchain, cryptocurrency, and other innovative digital tools. In attendance was Matthew Fraser, the city’s chief technology officer appointed by Adams.
Fraser outlined several initiatives the administration is working on, including launching educational activities, helping organize meetings and events, and developing an official digital wallet for city employees and public benefit recipients. At the time of writing, the status and release schedule for these projects are unclear.
A representative from the city’s Office of Technology and Innovation (OTI) told Cointelegraph that the agency is “committed to responsibly deploying new technologies to improve service delivery, optimize city agencies, and keep New Yorkers safe.” He said.
“We will continue to assess the real needs and risks of blockchain applications in the public sector.”
Representatives pointed to OTI’s 2024 hiring of a Digital Asset and Blockchain Policy Advisor as an example of its ongoing efforts. According to the expired job listing, the advisor’s primary role will be to “support the definition and implementation of NYC’s digital asset strategy.”
relevant: Crypto City: New York Guide
Adams was asked about his commitment to Bitcoin again in a July 2024 interview on local TV station FOX5’s The 5 O’clock News program. He told anchors that in addition to Bitcoin, “we need to look at other forms of cryptocurrency as well.” “A cashless wallet.”
“There is so much we can do. We should not be afraid of these new ways of paying for goods and services. We must accept it.”
Is New York Now a Bitcoin City?
OTI has defended the Adams administration’s record on cryptocurrencies, but not everyone believes he has had a real impact. As OTI notes, the city prioritizes “reasonable” arrangements that keep New Yorkers safe.
“This means not simply chasing trends, but carefully evaluating these technologies to ensure they deliver real benefits to New Yorkers.” What is considered reasonable varies greatly from person to person.
Thomas Pacchia, founder of NYC-based Bitcoin bar PubKey, told Cointelegraph that there has been “nothing I can notice” since Adams took over. “If there was a specific program, it didn’t really show up on my desk in PubKey or in any of the other work I’ve been doing.”
PubKey recently made headlines after Republican presidential candidate Donald Trump used the Bitcoin Lightning Network to pay for a burger. The bar regularly hosts Republican and Democratic politicians to learn about Bitcoin and blockchain or participate in events promoting cryptocurrency-friendly policies. But according to Pacchia:
“We haven’t heard anything from his office or the mayor’s office. I think that speaks volumes.”
One of the challenges the city faces is that, no matter how cryptocurrency-friendly the mayor’s administration is, the city is still under the state government. And New York State has perhaps the most stringent regulators in the country when it comes to cryptocurrencies.
Donald Trump (center) at PubKey with Thomas Pacchia (right) Source: public key
The Attorney General’s Office has filed lawsuits against Gemini, KuCoin, and Tether, and the Department of Financial Services requires companies wishing to provide digital asset services to apply for and receive BitLicense, a complex and costly licensing process.
New York’s BitLicense scheme has been incredibly unpopular among cryptocurrency companies and entrepreneurs and has been a constant source of frustration. According to Pacchia, “It’s preventing Bitcoin companies from even considering entering the state.”
“It’s unfortunate that New York State is listed alongside North Korea, Iran and other sanctioned countries whenever you see time of service or something like that. If you live in New York State, don’t use it.”
Julie Samuels, president and CEO of Tech:NYC, a non-profit organization that promotes tech-friendly policies, told Cointelegraph: “New York’s strict licensing structure for virtual currency businesses is intended in part to increase consumer confidence. Conceptually, this could actually be a huge boost to the cryptocurrency scene here, as New York is the first state to take this step to set clear rules for businesses to follow.”
However, “long times to secure licenses and inconsistent access to Department of Financial Services staff for potential license applicants have clearly slowed the pace of growth in the sector and limited the economic impact cryptocurrency companies can have on the state.” .”
According to Pacchia, the solution to making NYC a truly cryptocurrency-friendly city is very simple. “Ditch BitLicense.” He acknowledged that Adams alone could not have had this power. “But as the mayor of New York, it’s a pretty big podium to start making progress through common sense and real regulatory pieces.”
The Future of Crypto-Friendly Policies When Adams Leaves Office
Considering Mayor Adams’ legal predicament, it’s unclear what will happen to him next. He has so far rejected calls to resign and said he would fight the charges against him “with all my might and spirit.” On October 9, he reiterated that he had no plans to resign and would run for re-election in 2025. If found guilty, he could face up to 45 years in prison.
Adams could be forced out of office by Gov. Kathy Hochul, but so far she has resisted calls to do so. He could also be removed from office by a special “Mayoral Incompetence Commission.” If he is removed from office or decides to resign, the city’s public advocate, Jumaane Williams, will assume power and a by-election will be held to determine a new mayor.
Since Williams has been unable to fire any of Adams’ appointees, including Fraser, the cryptocurrency advocate’s chief technology officer, it is highly unlikely that the city’s blockchain plans will be canceled in the near term. But whoever replaces Adams will have the power to tighten the plan, scale back or leave it as is.
Either way, Adams will face a very tough fight in the next election in 2025. This means his policies may eventually go out the window.
The Promises and Dangers of Politicians
Adams is not the only cryptocurrency-advocating American politician facing various criminal charges. Trump, the most famous figure, is currently embroiled in four separate lawsuits.
Some in the cryptocurrency community are beginning to worry that cryptocurrencies’ increasing association with and support of controversial politicians will have a negative impact on the industry. Ethereum co-founder Vitalik Buterin recently expressed some frustration, arguing that people should not be single-issue voters on cryptocurrencies and should consider candidates’ broader positions on other issues.
Two weeks later, National Security Agency (NSA) whistleblower Edward Snowden echoed this sentiment, telling attendees at the Bitcoin 2024 conference: “Vote, but don’t join a cult.”
So what can we learn from Mayor Adams’ example? Perhaps one lesson is that electing pro-crypto politicians could actually lead to at least some pro-crypto policies being implemented. However, there is never a guarantee that a politician will deliver on any particular campaign promise.
On the other hand, what a person can do on his own is generally limited. Even presidents must rely on Congress to take many of the actions they want.
magazine: Bitcoin Investors Are ‘All In’ on Trump After Bitcoin ’24, but It’s Getting Risky.
Adams also reminds us that no matter how cryptocurrency-friendly an elected official’s policies are, they bring any baggage they may have with them to office, and other unrelated leadership decisions may be very unpopular or controversial.
According to a December 2023 Quinnipiac University poll, Adams was the most unpopular NYC mayor since polls began in 1996. Meanwhile, a more recent Marist poll conducted Oct. 1 found that 69% of registered voters thought he should resign.
But blockchains like Bitcoin are intentionally built so that no single market, or even a president, can ultimately dictate the future. So people can take some comfort in the fact that no matter what politicians and elected officials do, whether they support the sector or not, and whether it is loved or hated, cryptocurrencies themselves will continue to thrive as they always have. there is.