Former New York Mayor Eric Adams, widely known in the crypto community as the “Bitcoin Mayor,” is now at the center of a significant cryptocurrency scandal. A meme coin, personally endorsed and promoted by Adams, experienced a dramatic $2.5 million liquidity withdrawal shortly after its high-profile launch, leading investors to raise serious allegations of a meticulously planned “rug pull” scam.
Throughout his mayoral tenure, Eric Adams consistently championed cryptocurrency, earning a reputation as an ardent believer in digital assets. He famously pledged to transform New York into the “global cryptocurrency capital,” even taking his first three paychecks in Bitcoin upon assuming office in 2022. His proactive stance included spearheading the city’s inaugural cryptocurrency summit, actions that initially garnered considerable acclaim within the crypto sphere.
The controversy ignited on January 12th, when Adams appeared in Times Square to unveil the “NYC Token.” He presented it as a cryptocurrency project dedicated to “public utility” missions. Leveraging the former mayor’s influential backing, the NYC Token’s market capitalization surged to an astonishing $580 million post-launch, reflecting immense enthusiasm from retail investors and market observers alike.
However, this meteoric rise was short-lived, lasting only a few hours.
$2.5 Million Liquidity Drain at Peak Valuation
The situation rapidly deteriorated as on-chain data detected suspicious fund movements precisely when the token’s price reached its zenith.
Investigations by blockchain analytics firm Bubblemaps, corroborated by several researchers, revealed that a wallet with strong ties to the NYC Token’s deployer abruptly siphoned approximately $2.5 million in USDC from the liquidity pool at the peak of the token’s value. While roughly $1.5 million was later returned to the pool, the token’s price had already crashed by over 60%. This left an estimated $900,000 unaccounted for.
This manipulative maneuver – withdrawing substantial liquidity at a token’s price high, thereby trapping ordinary investors and inflicting massive losses – is a classic “rug pull” tactic in the cryptocurrency market. Such actions quickly fueled widespread speculation that the project’s creators deliberately inflated the token’s value only to extract liquidity.
A “rug pull” is a deceptive scheme where project developers or associated entities suddenly remove liquidity after attracting significant investment, causing the token’s price to plummet and making it virtually impossible for investors to sell their holdings.
According to its official website, the NYC Token boasts a total supply of 1 billion tokens, with a substantial 70% allocated to a “reserve pool” and not intended for market circulation. Adams publicly claimed that future funds generated by the token would be used to combat “anti-Semitism” and “anti-Americanism,” to be managed by an “unnamed non-profit organization.”
However, the project team’s refusal to disclose co-founder details or outline specific fund management and oversight mechanisms has raised serious questions regarding its transparency and legitimacy.
Further compounding the skepticism were Eric Adams’ perplexing responses during an interview with prominent Fox Business anchor Maria Bartiromo. When pressed about the token’s practical applications, Adams unexpectedly referenced retail giant Walmart:
“Look at the best use case for blockchain: Walmart. They use this technology to track food flow… It’s very transparent. And our NYC Coin, it’s about using the money earned to stop the spread of anti-Semitism in our country, and even globally.”
Adding to the embarrassment, the former New York Mayor, despite his vocal enthusiasm for cryptocurrency, twice mispronounced “blockchain” as “block change” during the interview. This gaffe significantly undermined his credibility and intensified community doubts about the project’s overall reliability.
It is crucial to note that this “NYC Token” is distinct from the “New York City Coin (NYC Coin)” that Eric Adams promoted earlier in his term. The latter, issued under the CityCoins protocol, was delisted by major exchanges as early as 2023 due to insufficient liquidity and a lack of practical utility. It appears Adams’ journey in the crypto world continues to be marked by controversy and considerable turbulence.
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