Eric Adams Launches Cryptocurrency Amid Controversy
NEW YORK — One moment, Eric Adams seemed to be gaining momentum. He recently returned from trips to Dubai and the Democratic Republic of Congo, and as a former mayor of New York City, he stood in Times Square on Monday to unveil his first private venture: a new cryptocurrency, the NYC Token, aimed at combating anti-Semitism and anti-Americanism.
Adams asserted that changes were on the way, though he didn’t clarify how this digital currency would fulfill such lofty goals. “This is going to move at an incredible rate,” he said.
However, things took a sharp turn shortly after the NYC Token launched. Valued at nearly $600 million initially, it plummeted by almost 75% by the end of the day. This dramatic fall came after creators associated with the token withdrew $2.5 million worth of coins, raising red flags. Crypto analysts noted it appeared to mirror “pulling the rug out,” a tactic seen often in the world of celebrity-driven cryptocurrencies, where creators hype their coins before dumping their holdings and leaving investors with losses.
About $1.5 million was eventually returned, but trust had already eroded significantly. Some criticized Adams and his inexperienced team for capitalizing on a shaky launch that misled naive investors.
In the wake of these developments, Adams found himself in familiar territory—damage control. He faced scrutiny over allegations of misconduct while also having to defend the competence of his team. Through a spokesperson, he insisted he gained no financial benefit from the tokens nor mismanaged any funds, labeling contradictory reports as “false and unsupported by evidence.”
“Like many newly launched digital assets, NYC Token has experienced market volatility,” spokesperson Todd Shapiro stated. “Mr. Adams has consistently emphasized transparency, accountability, and responsible innovation.”
A Mechanical Lawyer and an Israeli Hotelier
Despite his claims of transparency, Adams has yet to disclose who the partners are in the token project.
Two sources close to the initiative revealed that Frank Carone, Adams’ former chief adviser, was integral to its launch. They spoke anonymously due to directives against revealing identities involved in the token’s creation.
Shapiro confirmed that one of Carone’s former clients, Yosef Sefi Zwieri, a real estate entrepreneur linked to several hotels in Israel, played a role in the token’s formation. Zwieri had previously drawn attention for managing a college dormitory in Brooklyn marred by complaints from residents about poor living conditions. After running into financial trouble, he had turned to Carone for legal help.
While their specific roles in the token’s launch remain vague, sources indicated that part of Zwieri’s responsibility included liaising with influencers before the debut. Notably, neither he nor Carone has direct cryptocurrency experience, and attempts to reach both went unanswered.
Facing mounting questions, Adams turned to billionaire cryptocurrency investor Brock Pierce, who also has a background in entertainment. After reviewing the project, Pierce expressed confidence that “no one ran away with anyone’s money,” though he added had he been involved earlier, he would have assembled a more capable team.
Instability of Political Coins
Industry experts assert that political-backed cryptocurrencies are particularly susceptible to dubious trading practices. High-profile examples include Argentina’s President Javier Milei, who, despite attracting numerous investors, saw his own crypto venture collapse rapidly. Similarly, coins linked to former President Trump and First Lady Melania Trump exhibited drastic value swings shortly after their launch.
The NYC Token’s investor base, comprising just over 4,000 accounts, is modest by comparison. An analysis by BubbleMap’s founder, Nicholas Weiman, found that around 80% of these accounts made purchases in the 20 minutes surrounding Adams’ announcement, suggesting an advantageous window for insiders and attentive traders.
“Political coins are purely attention-driven,” Weiman noted. “People know you don’t want to stick around, especially with such vague goals. What does combating anti-Americanism and anti-Semitism even mean?”
The NYC Token website claims that proceeds will be shared among initiatives to combat hatred and provide crypto education for youth, along with scholarships, but offers no specifics on which organizations will benefit.
Uncertain Fate
Adams contended that the withdrawals were due to operational adjustments by market makers trying to stabilize trading, rather than any wrongdoing from the token creators. The market-making organization involved, FalconX, has not provided any public statements.
As of Wednesday, most investors faced losses. Reports indicated that 15 traders lost at least $100,000 while ten others made gains of the same amount.
Pearce expressed hope that the project might still recover, hinting that pivotal developments were imminent. Yet skepticism remained prevalent within the cryptocurrency community.
“It could be a legitimate initiative, just poorly executed,” stated Benjamin Cowen from Into the Cryptoverse. “However, the launch strategy didn’t instill confidence, which makes regaining trust challenging.”
