Mayor of New York Eric Adams “Bitbonds” proposed, municipal obligations supported by Bitcoin, during the Bitcoin 2025 conference in Las Vegas. It aims to create a financial instrument so that Bitcoin holders invest in the city, positioning NYC as a crypto center. The concept, inspired by a memory of Bitcoin Policy Institute, suggests obligations with an annual interest rate of 1% over 10 years, where 90% of funds go to public spending and 10% to buy Bitcoin.
Investors would receive a share of Bitcoin price gains, with yields capped at 4.5% per year, dividing the excess 50/50 gains with the city. Adams also called for the repeal of the Bitlidense program of the State to facilitate cryptographic regulations. However, the NYC controller Brad rejected the proposal, the appellant “legally doubtful and fiscally irresponsible” because of the volatility of bitcoin and the lack of legal mechanisms so that the city issues such obligations or will manage Bitcoin transactions.
Lander stressed that the city’s obligations are mainly intended for capital such as infrastructure, and not for speculative investments, and could erode investors. Some experts suggest a pilot program to test the viability of bitbonds, but no concrete step or deadlines have been confirmed, and skepticism remains on the implementation given the regulatory and financial obstacles.
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Bitbag Could position New York as a pioneer in the integration of cryptocurrency in municipal finance, to potentially attract cryptography investors and to stimulate the reputation of the city as a technological center. However, the volatility of Bitcoin (for example, 60% of virtualized voting annualized in 2024 by web: 6) presents significant risks, potentially resulting in losses for investors and the city if the price of Bitcoin blocks.
The proposed structure (90% of funds for city spending, 10% for Bitcoin purchases, with capped yields and shared gains) could generate additional income if Bitcoin appreciates considerably. For example, an obligation of $ 100 million with an increase in the rise in Bitcoin could produce substantial yields for the city and investors. However, a price drop could erode confidence and limit funds for public projects.
Investors of traditional municipal bonds, which prioritize stability, could consider Bitbonds as risky loan costs, which is potentially increased for the conventional obligations of New York (which currently gives approximately 4% for 10 -year bonds per web: 19). This could erase the 100 billion dollar debts portfolio in the city. The absence of legal mechanisms for NYC to issue obligations supported by Crypto or Bitcoin Guard directly complicates the implementation. Federal laws on securities and state regulations (for example, Bitlicense) could delay or block the initiative unless exemptions or new executives are established.
Adams’ proposal aligns with its pro-Crypto position (for example, taking Payer checks in Bitcoin), calling on the growing cryptographic community and younger and warned voters in technology. Publications X Show the enthusiasm among the defenders of cryptography, some calling it a “game changer” for municipal finance.
The proposal deepens the divisions, with criticisms such as the Brad Lander controller the imprudent labeling, reflecting a broader skepticism among traditional financial and political personalities. This could fuel debates on budgetary responsibility for the innovation in the mayor’s race in 2025. If they are poorly executed, Bitbonds could undermine confidence in New York financial management, especially if taxpayers have losses of a slowdown in bitcoin. Conversely, success could improve the image of Adams as a avant-garde leader.
Bitbonds are a daring step to modernize finance, take advantage of Bitcoin potential (for example, an increase in prices of 120% in 2023) and attract cryptographic wealth to finance city projects such as infrastructure or social programs. The arguments align with global trends (for example, the Bitcoin obligations of El Salvador). Could diversify the city’s sources of income, reducing dependence on traditional taxes. Using an increasing demography of cryptographic investors (30% of American adults have a crypto).
Bitbonds are speculative and risky, threatening the budgetary stability of New York and the confidence of investors. Lander calls them “legally doubtful” and warns against mismanagement. The volatility of Bitcoin makes it inappropriate for municipal obligations, which prioritize security (for example, the AA2 Moody’s notation by web: 19). No legal framework exists so that cities are detained or exchange bitcoin, risking regulatory violations. Could alienate holders of traditional bonds, increase borrowing costs and have an impact on city services.
Critics on X call it a “gadget” or “irresponsible blow”, warning of a “crypto crash targeting taxpayers”. The debate reflects a cultural and economic split: crypto enthusiasts and technological optimists compared to traditionalists prioritize stability. This reflects national tensions on the regulation of cryptocurrencies (for example, dry against cryptographic industry) and local concerns concerning budgetary prudence in a city with a budget of $ 110 billion.
Practical obstacles (regulation, infrastructure and acceptance of the market) suggest that Bitbonds remain speculative, pilot programs as potential compromise. Without clear progress, the gap can widen as skeptics double risk problems and supporters are growing in the integration of cryptography.
