New York City's new mayor, Eric Adams, plans to convert his first paycheck this week into two cryptocurrencies, which he has been hyping as a potential economic engine for the city.
His timing couldn't have been better. Cryptocurrency prices continue to decline with bitcoin dropping to a five-month low Friday at $38,568.18 a share. Etherium, the second largest cryptocurrency after bitcoin, fell more than 12.5%, trading at just below $2,800.
The Democrat's office announced Thursday that Adams' first salary payment will be deposited with Coinbase, an online platform used for buying cryptocurrency, and then converted into ethereum and bitcoin.
"New York is the center of the world, and we want it to be the center of cryptocurrency and other financial innovations," Adams said in a statement. "Being on the forefront of such innovation will help us create jobs, improve our economy, and continue to be a magnet for talent from all over the globe."
The city noted in its news release that federal labor rules bar the city from paying employees in cryptocurrency, but that any worker paid in U.S. dollars can use an exchange to buy cryptocurrency.
Adams' use of his public office to promote the crypto industry drew criticism from at least one upstate New York environmental group, Seneca Lake Guardian, which noted that creating and managing cryptocurrency can consume enormous amounts of energy, often produced by power plants that contribute to climate change.
"Mayor Adams is dead wrong and his ignorance could cost New Yorkers millions of dollars in energy bills while killing local economies, poisoning our water and filling our air with deadly C02 emissions," the group said in a statement.
State Attorney General Letitia James has investigated cryptocurrency trading platforms and warned last year that investors "should proceed with extreme caution when investing in virtual currencies."
"Cryptocurrencies are high-risk, unstable investments that could result in devastating losses just as quickly as they can provide gains," James said.
Adams has suggested that cryptocurrency and blockchain technology, a digital ledger where cybercurrency transactions are recorded, should be taught in schools.
Cryptocurrency is a type of digital money that uses encryption technology to track transactions. They don't have a country's government backing them, a central bank, interest rates, or a long history of exchange rates against other currencies. That can make it difficult to assess their value.
Investors rely on market-driven changes in the value of cryptocurrency to make a profit.
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