Photo-Illustration: Intelligencer. Photos: Getty Images
There’s something of an arms race going on between Eric Adams and his future Miami counterpart, Mayor Francis Suarez — Adams calls it a “friendly competition” — over which big city will be the dominant hub for the emerging cryptocurrency industry. Suarez, a Republican who embraced the cryptos during the pandemic, has come out ahead by loudly marketing the Magic City as a more business-friendly alternative to Silicon Valley, cheering on, for instance, a crypto exchange to win the naming rights for the Miami Heat’s arena. His MiamiCoin has yielded $20 million for the city’s coffers just a few months after it was first announced. The project has been so successful that the city is planning to return that money to Miamians through a dividend.
So when Suarez announced on Twitter that he would take a paycheck entirely in bitcoin, Adams saw the chance for some one-upmanship. “In New York we always go big, so I’m going to take my first THREE paychecks in Bitcoin when I become mayor,” he posted on November 4. “NYC is going to be the center of the cryptocurrency industry and other fast-growing, innovative industries! Just wait!” Of course, there were jokes about the whole thing, even though Adams’s cheerleading for crypto and tech jobs could be hugely impactful in the city’s economic recovery coming out of the pandemic. But looming over the whole thing is a bigger question: Can Adams actually be paid in bitcoin?
Turns out, that’s complicated. It’s unclear if the city itself could pay Adams in anything other than dollars at the moment. The New York City charter makes it plain that the mayor will be paid a salary of “two hundred fifty-eight thousand seven hundred fifty dollars a year,” and there don’t appear to be any carve-outs for other denominations. And despite the name, cryptocurrencies like bitcoin are actually considered a kind of commodity thanks to a Depression-era law, meaning that, from a certain angle, it wouldn’t really be that different from Mayor Bill de Blasio asking to get paid in barrels of oil. Such a process is like “asking a city institution to essentially bank for you,” one skeptical former federal prosecutor, now in private practice, told me. “They have to take the dollars that are issued from the budget for his salary and now convert it into virtual currency.” On the question of how the city could go about converting dollars into digital currency, the Department of Finance didn’t return an email seeking clarification, the comptroller’s office said I should talk to the Office of Payroll Administration — a department it helps oversee — and that department said I should reach out the current mayor’s office, which didn’t get back to me.
But this could change — and not just for Adams but for all municipal workers. Not only has Suarez proposed paying Miami public employees part of their paycheck in crypto, so has the mayor of Jackson, Tennessee. And the industry has been more than happy to accommodate these plans. BitWage, a San Francisco–based firm that has been around since 2014, has about 2,000 companies and 50,000 registered users — including Toronto soccer star Ifunanyachi Achara — who use its platform to automatically convert all or part of people’s paychecks into crypto, CEO Jonathan Chester told Intelligencer. Working directly with municipalities can be a complicated process due to government contracting and transparency rules, which sometimes specify that, in order to win a request for a proposal, a business must have been operating for a certain number of years or have already worked with the government, Chester said. “This kind of traditional way of doing an RFP doesn’t quite work in this industry because of how new it is,” he added. If Adams wants, though, every city building inspector, subway operator, and librarian could soon be getting in on the roughly $3 trillion and growing market. But there’s nothing stopping Adams from converting his salary on his own. Coinbase, the massive crypto exchange, is planning to roll out a program next month that will allow its customers to directly divert funds from their payroll onto the exchange, Prakash Hariramani, the company’s senior director of product, said in an interview.
When reached about Adams’s boast, the next mayor’s team walked back the tweet a bit. “He will take his paycheck in dollars and then convert it to bitcoin through an exchange,” said spokesman Evan Thies. There was no word on whether Adams already owns bitcoin — for what it’s worth, there’s no mention of it in his 2020 public disclosures — or if he wants to make it more widely available to city employees. But if he wants to outmatch Suarez in his friendly competition, he may need to do more than just open a trading account for himself.