The cryptocurrency market has witnessed a significant event with the launch of the NYC token, a digital asset introduced by former New York City Mayor Eric Adams. The token’s market capitalization briefly reached an estimated $540 million to $600 million but crashed by over 81% within 30 minutes of its launch on the Solana blockchain, resulting in a loss of approximately $500 million in peak security value. This drastic decline has raised concerns about the token’s legitimacy and the potential risks associated with investing in such assets.
According to on-chain investigators, the token’s launch was marred by liquidity movements and concentration risks. A wallet connected to the deployer created a one-sided liquidity pool on Meteora and withdrew around $2.5 million in USDC near the maximum price. Furthermore, the top five wallets held about 92% of the supply, with the top 10 holding approximately 98.73%. One wallet alone held around 70% of the supply, indicating a highly centralized ownership structure. These factors contributed to the token’s price discovery being dependent on a thin number of wallets and a small amount of removable liquidity, increasing the risk of slippage during exits on decentralized exchange (DEX) locations.
Retail investors have suffered significant losses, with one wallet tracked by Solscan making five purchases totaling 745,725 USDC and then selling for 272,177 USDC, resulting in a loss of approximately $473,548 in less than 20 minutes. The speed and centralized nature of the token’s launch have raised questions about the control and disclosure of the project, including who funded the launch, what agreements governed liquidity provision and market-making, and whether promotional representations matched on-chain execution.
Former Mayor Eric Adams has been a proponent of cryptocurrency, having arranged to convert his first paycheck as mayor into cryptocurrency in early 2022. He has also increased his crypto visibility through city initiatives and public appearances. However, the NYC token’s launch has been marred by controversy, with some accusing the project of being a “rug pull” – a type of scam where developers abandon a project and withdraw funds. The incident has sparked discussions about the need for greater regulation and transparency in the cryptocurrency market.
The broader memecoin market has also experienced significant fluctuations, with the market capitalization falling 61% from highs in early 2025 to around $36.5 billion before recovering to $47.3 billion in early 2026. The volume has also decreased from around $20 billion in mid-2025 to under $3 billion in December. Regulatory attitudes have changed, with the SEC stating that many memecoins do not involve securities transactions as they are typically purchased for entertainment, social interaction, and cultural purposes. However, fraudulent behavior may still be prosecuted by other federal or state authorities.
In the case of the NYC token, the immediate questions center on control and disclosure, with many calling for greater transparency and accountability. The incident has highlighted the risks associated with investing in cryptocurrency and the need for investors to exercise caution and conduct thorough research before making investment decisions. As the cryptocurrency market continues to evolve, it is essential to prioritize transparency, regulation, and investor protection to prevent similar incidents from occurring in the future. For more information, visit https://cryptoslate.com/eric-adams-nyc-token-crashed-81-and-a-single-wallets-massive-70-holding-reveals-why-the-game-was-rigged/
