New York mayor’s charisma wooing crypto firms

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The encouraging rhetoric from New York City’s new mayor, Eric Adams, is a welcome sign for cryptocurrency-related businesses looking to locate there.

– to be[IN]cryptography

Yet despite these positive signs, some wonder if he will have the power to enforce stricter regulations at the state level. Additionally, Adams faces competition from other US cities vying to become the next crypto hub.

Companies encouraged

With a limited but distinct choice, cryptocurrency and blockchain startup Ava Labs was unsure of where to locate. However, company president John Wu said Adams’ election played “a big part” in his decision to move into the Big Apple. “Knowing that we have a friendly administration, especially in the New York area, is going to be very helpful,” Wu said.

By doubling down on its choice of New York City, cryptocurrency data platform Chainalysis last year signed a lease for office space in Manhattan that can accommodate up to 200 employees. “The new mayor’s support for the industry reinforces my belief that New York is the best place to host Chainalysis,” said co-founder and CEO Michael Gronager. “We plan to tap into the city’s talent pool for our next phase of growth. “

Regulatory effect?

After his election, Adams spoke out in favor of cryptocurrencies, offering to receive his first three months salary in Bitcoin and suggesting that local schools educate students about cryptocurrency and blockchain technology. Adams had also expressed interest in developing a digital wallet for city employees and recipients of public benefits, which inspired CityCoins to make NYCCoin their next venture.

While he has yet to come up with specific policies that would provide a legitimate incentive for upcoming crypto companies, some believe his positive stance has already proven to be effective. “I think it’s a very effective signaling tool for… saying, ‘Okay, we recognize that this industry can benefit everyone,'” said Zach Dexter, CEO of the FTX crypto derivatives exchange. US Derivatives.

However, others wonder if Adams, as city leader, will be able to affect existing state-level regulations, especially those that contradict his own assessment. “He can be a cheerleader,” said Murphy & McGonigle attorney Stephen Gannon. “But most of the time, the regulatory environment is run by the state.”

New York State has some of the most stringent requirements for crypto-related businesses, including “BitLicense” and compliance with know-your-customer, anti-money laundering, and capital regulations. . Additionally, New York Attorney General Letitia James said these companies must register with his office before operating in the state or offering products to New Yorkers, after shutting down a pair. who didn’t.

Despite these obstacles, some argue that Adams could subsidize these costs through other incentives, such as trade tax breaks. Former New York Department of Financial Services (NYDFS) chief innovation officer Matt Homer believes Adams “could potentially… have regulatory influence,” as Governor Kathy Hochul had previously committed to work with him on business matters.

Crypto contest

In light of these challenges, New York will have its work cut out for creating compelling incentives, something competing locations have already started to do. For example, Colorado passed a law in 2019 that exempts digital currencies from certain securities rules, while Wyoming created its own special purpose charter for crypto companies.

However, Miami is standing out as New York’s main rival as a crypto hub thanks to the efforts of its own crypto-savvy mayor, Francis Suarez. Boasting of lower taxes and the cost of living, as well as cheap renewable energy sources, Suarez even inspired a friendly rivalry with Adams with his defense of MiamiCoin. Ultimately, given the decentralized nature and rapid growth of the industry, crypto executives believe more than one city will become a crypto hub in the United States.

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This story was first seen on BeInCrypto

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