A lot of people have lost a lot of money in cryptocurrency of late, including New York City Mayor Eric Adams. Last November, with Bitcoin peaking close to $69,000 and his inauguration just weeks away, Adams announced a grand plan to not only take his first three paychecks in cryptocurrency, but to make New York City “the center of cryptocurrency.” For a mayor with few legislative priorities, that commitment ranked high on a short list.
On Jan. 21, according to reporting in the Verge, Adams received the first of his biweekly paychecks— $5,900, according to the New York Post—and flowed that money into the crypto exchange Coinbase. Adams’ office confirmed that he did indeed go on to convert three paychecks into cryptocurrency, splitting the money between Bitcoin and Ethereum.
Some back-of-the envelope math gives a rough sense of how much money that decision has cost hizzoner. At time of writing, Bitcoin sits at $16,811.40; Ethereum is $1,229.74. Maybe they’ll have gone up since then; it’s possible, by the time you’re reading this, they’ll be lower still. That means that Adams has lost roughly 53 percent, 60 percent, and 57 percent on his first three paychecks.
Check my work: I calculated those figures based on the daily average of each currency on each of the three paydays. I assumed that the money was parceled evenly between the two separate coins. Cryptocurrencies can fluctuate substantially in value even on a minute-by-minute basis (critics would say this is just one reason they seem not to be especially well-suited as currencies), so it’s possible Adams arbitraged his purchases so perfectly that he beat the daily average. It’s possible too that he loaded up on Bitcoin, which is only down 64 percent this year, rather than Ethereum, which is down 66 percent. Maybe he saved a couple bucks here or there over the daily average trader—he has self-identified as a computer enthusiast, after all. But those last two numbers tell most of the story. All the major cryptocurrencies that haven’t gone to zero share the same vertiginous downward trend.
Where does that leave us? In good old-fashioned U.S. greenbacks, it means Adams has likely lost just over $10,000 on the stunt, which is a not insignificant amount of his pay. On Friday, he cashed the 24th paycheck of his mayoralty.
I say “likely” in part because the mayor’s office would not confirm whether Adams is still holding onto all that crypto. It also declined to comment on whether the mayor has concerns about the liquidity of the exchange in which he’s parked his earnings, as crypto exchanges FTX, Celsius, and BlockFi have all folded in the past month. (So far at least, Coinbase’s stock isn’t doing so hot, but the exchange seems to have avoided the crypto contagion.)
Many people have learned a hard lesson not to be repeated. Not Adams. His office also told me that his initial pledge to make the city a cryptocurrency hub remains unaltered and undeterred by the incredible display of graft and misbehavior that has turned out to be commonplace in the sector.
“Mayor Adams believes cryptocurrency, blockchain, and other emerging technologies offer an incredible opportunity for innovation and economic growth over the long term, and he wants to see that happen right here in New York as we continue our recovery from COVID-19,” said spokesperson Jonah Allon. “As with all financial products, price fluctuations are an expected feature of the market—and it is shortsighted to believe that setbacks in an industry are an indication that it won’t experience long-term growth.”
Meanwhile, Adams’ other November commitment, support for a New York City–specific cryptocurrency, has gone even worse. NYCCoin is down almost 94 percent since it was introduced with the mayor’s support in February. MiamiCoin, which began trading in August of 2021 and has been pushed by that city’s similarly crypto-zealous mayor, Francis Suarez, is down 98 percent for the year, trading at $0.000458.
Adams is not the only New York City politician caught up in the fast-collapsing crypto ecosystem. Rep. Ritchie Torres, who represents the Bronx, has also made headlines lately, calling for the Government Affairs Office to investigate why the Securities and Exchange Commission did not expose FTX before its collapse.
In March, Torres was one of eight members of Congress to send a letter effectively insisting that the SEC back off its crypto investigation. A month later, a crypto fundraiser was thrown on his behalf by members of the venture capital firm Andreesen Horowitz at the tony private club Zero Bond in Manhattan, perhaps best known for being Adams’ late-night favorite. The event was called the “Ritchie Torres Ethereum Fundraiser”; one invite encouraged guests to donate in crypto.
In June, Adams came out strongly against a bill passed by the New York State Senate imposing a two-year moratorium on new proof of work crypto-mining operations due to their large carbon footprint. He called on Gov. Kathy Hochul to veto the bill.
Hochul did not. In November, after it was signed into law, Adams softened his stance on the bill.
There have been plenty of hucksters who unloaded crypto onto unknowing marks, getting rich in the process. Adams, to his credit, bought in and had some real skin in the game. He, like so many others, is poorer for it.