Published Nov 22, 2022
Modified Nov 22, 2022
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Published Nov 22, 2022
Modified Nov 22, 2022
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One of the world’s largest cryptocurrency exchanges recently imploded. Crypto investors have suffered trillion-dollar losses.
But Mayor Eric Adams is showing no signs of retreating from what he has described as the future of commerce.
“These industries are not going to go away because they reached a low point,” he said Tuesday during an unrelated press conference. “This is an industry that we must embrace.”
Responding to recent events, the mayor argued that all industries have bad actors and “ups and downs.” He pointed to losses he has suffered in the stock market.
“I’m afraid to even look at it nowadays,” he said.
The remarks suggest the mayor’s confidence in a highly volatile and increasingly scrutinized industry. Adams’ doubling down on crypto comes as other prominent supporters have quietly backed away from the world of virtual currencies.
Critics have long maintained that crypto – which offers a decentralized banking system that trades digital currencies – is a scam. Their concerns appeared to grow more valid after this month’s front-page collapse of FTX, a $32 billion crypto exchange company that appeared to misuse customer funds. FTX is now the focus of multiple federal investigations.
“Cryptocurrency is a self-assembled Ponzi scheme made up of Ponzi schemes, stock frauds and other financial scams,” said Nicholas Weaver, a computer scientist at the University of California at Berkeley who has been an outspoken critic of the industry.
He added, “The space needs to be yeeted into the sun, and if the New York mayor thinks there is any value in it, he doesn't understand it.”
Adams, who studied to be a computer programmer, was an early crypto booster. After winning the general election last year, he flew on a crypto billionaire’s private jet to attend the Somos conference, an annual political networking event, in Puerto Rico. As mayor, he elected to have his first three paychecks converted into bitcoin and ethereum, two popular cryptocurrencies. And in March, he was a panelist at a conference in Miami where he gushed about the possibilities of the new digital currencies.
John Kaehny, executive director of Reinvent Albany, a good government group, said it was “disappointing” to hear the mayor continue to validate crypto.
“There is no governmental case or public policy case for the city of New York to support crypto,” he said.
That the mayor would invest time in trying to find applications for crypto suggested a real opportunity cost to taxpayers, according to Kaehny. “You’re not spending time on real immediate problems,” he said.
On Tuesday, Adams, who has previously said he wanted to institute a public education program on crypto, touted a recent youth summit where he said crypto was taught.
Asked if he would still invest in crypto, the mayor was unequivocal. Pointing to his first three paychecks, he said, “Yes, my money's already there.”
By Kaehny’s calculation, since his first paycheck, the mayor’s investment in bitcoin has fallen by 44%.
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Elizabeth Kim is a reporter on the People and Power desk who covers mayoral power. She previously covered the pandemic, housing, redevelopment and public spaces. A native of Queens, she speaks fluent Mandarin.
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