Eric Adams Crypto Coin Crashes Soon After Launch, Sparking Scam Accusations

Eric Adams' NYC Token, a Solana-based cryptocurrency launched on January 12, 2026, plummeted by more than 80% in value within hours. The token initially reached a market capitalization of approximately $730 million before its dramatic decline according to reports. The launch was intended as a commemorative asset to support causes like fighting antisemitism and promoting blockchain education as detailed in coverage.

On-chain analytics platforms identified suspicious activity in the token's liquidity pools shortly after the launch. A wallet linked to the project's deployer reportedly removed $2.43 million in USDC from a decentralized exchange pool. While some liquidity was later returned, nearly $1 million remained unaccounted for. This withdrawal was interpreted by many traders as a liquidity extraction event.

The collapse of the NYC Token has drawn comparisons to previous politician-backed crypto projects that have failed under similar conditions. Analysts are concerned about the implications of such failures for the legitimacy of politically endorsed digital assets.

Why Did This Happen?

The token's value declined rapidly after liquidity was removed from the pool. Investors who had initially driven the market cap to $730 million were left with significantly devalued assets. The liquidity extraction is seen as a potential rug pull, where project creators profit from the hype before leaving investors with a depreciating asset according to analysis.

A wallet associated with the token's deployer reportedly removed $2.43 million in liquidity at the token's peak. After a 60% price drop, the account returned roughly $1.5 million, leaving nearly $932,000 unaccounted for. This imbalance allowed the deployer to exit their position while retail investors bore the brunt of the losses.

How Did Markets React?

The market response to the NYC Token's collapse was swift and severe. Within hours of the liquidity withdrawal, the token's value dropped from its peak of approximately $730 million to a valuation near $110 million. This rapid devaluation left many investors with significant losses.

Retail investors who had purchased the token during its initial surge faced panic selling as the value plummeted. One trader reported a loss of $473,500 within 20 minutes of the crash according to reports. The liquidity withdrawal triggered a chain reaction of selling, further driving down the token's value.

What Are Analysts Watching Next?

Analysts are now scrutinizing the broader implications of the NYC Token's collapse. The incident has reignited calls for increased oversight of digital assets endorsed by public figures. Many are questioning the credibility of politically branded cryptocurrencies after this event.

The failure of the NYC Token could have lasting consequences for Adams' credibility as a crypto advocate. His stated goal of turning New York into the "crypto capital of the world" has been damaged by the token's poor performance. Investors and analysts are now closely watching how Adams responds to the allegations and whether regulatory scrutiny increases in response to this incident.