Impeached NYC mayor leaves questionable crypto legacy as controversy mounts

Three years before cryptocurrency became the talk of the town for the first time in the US presidential election, a distinctly crypto-focused race emerged in New York City to determine who would replace outgoing Mayor Bill de Blasio.

Democrat Eric Adams was running against Republican Curtis Slywa, and both campaigned on promises to be a pro-Crito mayor. Adams recently defeated another crypto supporter, Andrew Young, in the Democratic primary.

On the campaign trail, Adams promised to make NYC a “bitcoin hub.” In the year He was elected mayor in November 2021, after which he continued to promise that the city would become the “hub of the cryptocurrency industry” and argued that cryptocurrency should be taught in schools.

Nearly three years after he was elected mayor, Adams was indicted by the Federal Bureau of Investigation on charges of “bribery, campaign finance and conspiracy crimes” related to nearly a decade of alleged criminal activity. It has been reported that seven senior officials have resigned from their administration and many others associated with their administration have been charged or are under investigation.

With his political career now in jeopardy, Adams depends on those asking if he has left a positive impact on crypto in NYC. His administration has defended the record, but those on the ground say it has nothing to do with it. At the same time, many in the crypto community are concerned about the industry's ties to controversial figures like Adams.

Eric Adams's record on crypto

Fresh from his election win, Adams entered into a friendly rivalry with crypto-friendly Miami Mayor Francis Suarez, who promised to receive 100% of his salary in Bitcoin (BTC). In return, Adams said he would take the first three checks in crypto — a promise he later fulfilled with the help of Coinbase.

He promised. His promise was kept. pic.twitter.com/rSafDZDViN

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

NYC elected officials are required to fill out a financial disclosure form each year, among other questions, whether or not they have securities. In his 2023 disclosure, Adams indicated that he held between $5,000 and $54,999.99 worth of bitcoins — so it looks like he's still coming back from his first check.

After taking office, Adams continued to publicly express pro-crypto positions. In June 2022, a two-year ban on New York's new non-renewable-energy proof-of-work mining operations was passed by the state Senate, which reportedly asked the governor to veto the bill. Six months later, amid the depths of the bear market, Adams reiterated his support for crypto innovation despite the price drop.

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, Adams' replacement.

Fraser outlined several initiatives the administration is working on, including launching education efforts, organizing conferences and events, and developing an official digital wallet for city employees and public benefits. As of the time of writing, the status of these projects and a timetable for their release are unclear.

A representative from the city's Office of Technology and Innovation told Cointelegraph that the agency is “committed to the responsible deployment of emerging technologies to improve service delivery, streamline city agencies, and keep New Yorkers safe.”

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

The representative pointed to OTI 2024's adoption of digital assets and blockchain policy advisory as examples of its ongoing efforts. According to an outdated job description, the consultant's primary role is to “support the definition and implementation of NYC's digital asset strategy.”

Related: Crypto City: A Guide to New York

In a July 2024 interview on local television station FOX5's The 5 O'clock News program, Adams was again asked about his commitment to Bitcoin. In addition to Bitcoin, the anchors said, “We need to look at other types of cryptocurrencies and more.” Wallets without money.

“We have a lot to do. We should not be afraid of a new form of payment for goods and services. We should accept it.”

Is NYC Now a Bitcoin City?

While OTI defends the Adams administration's record on crypto, not everyone believes it has real impact on the ground. As OTI points out, the city prioritizes “reasonable” deployments that keep New Yorkers safe.

“This means carefully evaluating these technologies so that we are delivering real benefits to New Yorkers, rather than chasing trends.” What is considered reasonable varies from person to person.

Thomas Pacchia, founder of NYC-based bitcoin bar PubKey, told Cointelegraph that after Adams took over, “there's nothing I can't figure out.” “If there are certain programs, it never comes with my desk or any of the other things I've done on PubKey.”

PubKey recently made headlines after Republican presidential candidate Donald Trump paid for a burger using the Bitcoin Lightning Network. The bar regularly hosts politicians, Republicans and Democrats, who come to learn about Bitcoin and blockchain or participate in events promoting pro-crypto policies. However, according to Pachia:

“We've never heard anything from his office, from the mayor's office, which I think speaks volumes.”

One of the problems facing the city is that no matter how Klopp-friendly any mayoral administration is, the city is still beholden to its territory — and New York state has some of the nation's strictest regulators when it comes to crypto.

The Attorney General's Office has pursued cases against Gemini, KuCoin and Tether, the Department of Financial Services requires companies that want to provide digital asset services to apply for and receive a BitLicense – a complex and expensive licensing process.

New York's Bitlicensing regime is incredibly unpopular with crypto businesses and entrepreneurs and is a constant source of complaints. According to Pachia, “It's a deterrent to Bitcoin businesses from even considering coming to New York State.”

It's unfortunate that New York State is listed with North Korea and Iran and other sanctioned countries when you see a term of service or something like that – if you're in New York State, don't use this.

Julie Samuels, president and CEO of Tech: NYC – a non-profit advocacy group that pushes tech-friendly policies – told Cointelegraph, “New York's strict licensing framework for virtual currency businesses is in part to boost consumer confidence. In theory, this could actually be a big boost for the crypto scene here, as New York is the first state to take such a step to create clear road rules for companies to follow.

However, “extended deadlines for obtaining licenses and inconsistent access to license applicants by staff at the Department of Financial Services have slowed the pace of growth in the sector and limited the economic impact that crypto companies can have on the state,” he said.

According to Pachia, the solution to making NYC a truly crypto-friendly city is pretty straightforward. Adams admits he doesn't have that power alone, “but as the mayor of New York, this is a great platform to start moving forward with common sense and practical laws.”

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

Given Mayor Adams' legal predicament, it's unclear what's next for them. He has so far rejected calls to resign and said he will fight the charges “with every ounce of my strength and spirit.” On October 9, he reiterated that he had no plans to step down and would seek re-election in 2025. If convicted, he faces up to 45 years in prison.

Adams may be impeached by state Gov. Kathy Hochul, but she has so far resisted calls to do so. He can be removed by a special “Mayor's Incompetence Committee”. If he is removed or decides to resign, the city's Public Advocate, Jumaane Williams, will take over and a special election will be held to determine a new mayor.

Williams hasn't ruled out any of Adams' appointees — including Pro-Cryto's chief technology officer Fraser — so it's unlikely any of the city's blockchain startups will be scrapped anytime soon. But whoever replaces Adams will have the power to raise, lower or leave the tailbacks alone.

Either way, Adams faces an uphill battle in the next election in 2025, meaning whatever his policies may eventually go out the window.

The hopes and dangers of politicians

Adams is not the only prominent pro-crypto American politician facing various criminal charges. Trump, the most famous of the group, is currently embroiled in four separate legal cases.

Some in the crypto community are beginning to worry that the growing relationship and support of kriptovalyutnyh with controversial political figures is negative for the industry. Ethereum founder Vitalik Buterin recently ruffled some feathers when he said people shouldn't be single-issue voters about crypto, arguing that they should consider a candidate's broader stance on other issues.

Two weeks later, National Security Agency hacker Edward Snowden echoed this sentiment, telling conference attendees at Bitcoin 2024 that they should “vote, but don't join a cult.”

So what can be learned from the example of Mayor Adams? Perhaps one lesson is that electing a pro-crypto politician can actually lead to the implementation of at least some pro-crypto policies, although it certainly does not guarantee that a politician will follow through on a particular campaign promise.

On the other hand, anyone is usually limited by what they can do on their own. Even the president must turn to Congress to accomplish many of the tasks he wants to take on.

Magazine: Bitcoiners are ‘all in' on Trump since Bitcoin '24, but it's getting dangerous.

Adams is a reminder that no matter how pro-crypto an elected official's policy is, they bring whatever baggage they can carry to office, and their other unrelated leadership decisions may be unpopular or controversial.

In the year A December 2023 Quinnipiac University poll found Adams to be the least popular NYC mayor since polls began in 1996, while an additional Marist poll on October 1 found 69 percent of registered voters thought he should resign.

However, blockchains like Bitcoin are purposely built so that no single mayor or president can ultimately control their future. So people will probably do what politicians and elected officials do, whether they support the space or not — and whether they're loved or hated — because crypto itself will continue to flounder as usual.