Brad Lander, the New York City Comptroller, has criticised Mayor Eric Adams’s proposal to create municipal bonds that are backed by Bitcoin. He warned such an action would bring financial risks and undermine investor trust.
Lander made a public statement on 29 May. said While he holds office, he will not allow New York City issue the cryptocurrency-tied bond instrument. Lander’s office is responsible for debt issuance, along with the Mayor’s Office of Management and Budget.
“Cryptocurrencies are not sufficiently stable to finance our City’s infrastructure, affordable housing, or schools,” The comptroller added that the proposal exposed the city
“to new risks and erode bond buyers’ trust.”
According Bloomberg says Lander could be a contender for Adams’ seat in the November election. Lander will run as a Democrat while Adams seeks re-election as a candidate.
Adams announced plans to introduce On May 28, at the Bitcoin2025 conference, in Las Vegas Nevada, a Bitbond, a municipal bonds backed by Bitcoin was announced. Adams has also called for New York State to scrap its BitLicense Program.
“I believe we need to have a Bitbond, and I am going to push and fight to get a Bitbond in New York so you can do those same bond investments in New York City,” Adams addressed the audience at the conference.
The March Policy Brief from the Bitcoin Policy Institute (a Bitcoin lobbying group). outlined A possible model for BitBonds Bondholders, according to the document would receive an interest rate of 1% per year over a 10 year period. At maturity, the bondholders also get a percentage of Bitcoin’s price increases. Document also suggests that 90% of funds raised will go to government expenditures, and the remainder 10% used for purchasing Bitcoin as a strategic reserve.
Lander’s statement contained a simulation model of the bond’s possible structure. Investors would get 100% Bitcoin appreciation up until a compound annual rate of return equal to 4.5% for 10 years. “Upon achieving the threshold, investors receive 50% of additional Bitcoin appreciation. The government retains the remaining 50% of gains beyond the threshold.”
Adams is still unsure of the exact details regarding how BitBond will work. Lander said that New York City issuing bonds for capital assets and cannot finance any other purpose except under limited and very defined circumstances. According to Comptroller Directive 10, capital investments are long-term, such as infrastructure and technology upgrades. They benefit the city for multiple years.
Magazine: How crypto laws are changing across the world in 2025
“This article is not financial advice.”
“Always do your own research before making any type of investment.”
“ItsDailyCrypto is not responsible for any activities you perform outside ItsDailyCrypto.”
Source: cointelegraph.com
