Former New York City Mayor Eric Adams has dismissed allegations that his new coin, NYC Token, was linked to suspicious cash withdrawals that left investors facing heavy losses.
Key points to remember:
- Eric Adams denies moving funds, attributing NYC Token’s losses to early market volatility.
- The project admits a temporary rebalancing of liquidity at launch.
- Onchain data has reported significant withdrawals, keeping rug-pulling concerns alive.
In a statement posted Tuesday to Adams’ X account, spokesperson Todd Shapiro said reports suggesting Adams withdrew money from the New York token were “false and not supported by any evidence.”
The statement added that Adams neither touched investor funds nor profited from the token’s launch, insisting that “no funds were withdrawn from the New York token.”
New York Token Team Attributes Post-Launch Price Drop to Early Volatility
Shapiro called the token’s sharp price swings a familiar feature of early-stage crypto projects.
“Like many recently launched digital assets, NYC Token has experienced market volatility,” he said, describing the turbulence as a market-driven event rather than a coordinated pullback.
The response follows increased scrutiny of on-chain activity around NYC Token, which suffered a sharp decline shortly after its launch.
The project itself acknowledged the liquidity adjustments, saying it needed to “rebalance” in the face of high demand.
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These explanations failed to calm the critics. Independent analysts reported trades that appeared to drain liquidity as peak prices approached, sparking concerns among traders.
One of the first warnings came from Rune Crypto, which claimed that around $3.4 million in liquidity was withdrawn shortly after launch and accused the project of operating like a rug pull.
Visualization platform Onchain Bubblemaps also highlighted unusual patterns.
According to its analysis, a wallet connected to the token deployer withdrew about $2.5 million in USDC near the market peak, then added back about $1.5 million after the token’s price fell more than 60%.
Bubblemaps: 60% of NYC token traders lost money after launch
Bubblemaps further detailed the extent of traders’ losses. Out of around 4,300 participants, an estimated 60% finished the first hours of the token in the red.
Most losses were less than $1,000, but around 200 traders lost between $1,000 and $10,000. A smaller group suffered losses in the tens of thousands of dollars, while at least fifteen traders lost more than $100,000.
Adams’ camp emphasized that NYC Token was presented as a way to support nonprofit initiatives and community education, not as a speculative investment.
This episode nevertheless fueled concerns about transparency, particularly in terms of governance and liquidity management.
The project’s website states that the token is deployed on Solana with a total supply of one billion tokens, 70% of which are allocated to a reserve excluded from the circulating supply.
Although the team has cited unnamed partners in its liquidity actions, it has yet to release detailed details, leaving questions of oversight and accountability unresolved.
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