Sen. Zellnor Myrie and Manhattan District Legal professional Alvin Bragg are working collectively to fight illicit exercise after various high-profile cryptocurrency scams in New York Metropolis. The Cryptocurrency Regulation Yields Protections, Belief, and Oversight (CRYPTO) Act, a state senate invoice sponsored by Myrie, provides severe jail time for individuals who break the regulation.
The concept behind digital cash being transferred anonymously on-line is definitely not as new or high-tech an idea as some may assume. The follow goes again to the early Eighties, with the institution of eCash, and took off with the launch of Bitcoin in 2009. These days, the market cap for crypto globally has grown through the years to about $3.1 trillion.
“For these doing it the precise manner, digital foreign money removes a few of the obstacles and boundaries in our conventional finance system. One which we all know has been imperfect and that has not allowed for entry for sure segments of our inhabitants,” mentioned Myrie, who chairs the Senate Codes Committee. “However I feel the dangerous actors have been drawn to cryptocurrency due to a few of the pseudonymity hooked up with it.”
Crypto is a digital and public encrypted monetary system that isn’t government-backed. This differs from conventional “fiat” foreign money just like the U.S. Greenback or Japanese Yen. Many operators inside the crypto house are certainly authorized and controlled. Nonetheless, the felony component of crypto in New York has change into a hotbed of fraud, scams, and different monetary crimes as of late, mentioned Myrie.
General, $51 billion in crypto was acquired by illicit addresses in 2024, up from $11 billion in 2020, in accordance with the Chainanalysis Crypto Crime Developments report. In 2025, Chainanalysis noticed important concentrations of stolen fund victims within the U.S., Germany, Russia, Canada, Japan, Indonesia, and South Korea.
“Now beneath New York regulation, the crypto license has civil penalties however you shouldn’t have the ability to simply value in and pay the nice,” mentioned Bragg. “What this invoice would do is add felony penalties in order that we are able to maintain individuals accountable.”
Below the CRYPTO Act, if companies function with no crypto license and deal in quantities of $1 million or extra, then they may face a tier of prices, beginning at an A misdemeanor (most of 1 12 months in jail), as much as a C felony (most of 5-to-15 years in jail). Comparable felony crypto legal guidelines have been carried out in 18 different states. In 2025, Myrie additionally launched the R.I.P.O.F.F Act, which will increase penalties for fraud in monetary programs and broadens the definitions of bribery.
Usually, cash laundering investigations depend on banks and monetary establishments which can be required to confirm their clients and transactions. However crypto has a number of loopholes that make it splendid for transferring cash for illicit exercise, like medicine, weapons, or autos, undetected by folks that aren’t registered, mentioned Bragg.
In 2024, Victoria Jacobs was convicted of utilizing crypto to help “terrorist” coaching teams in Syria and was sentenced to 18 years in jail. She laundered $12,000 by receiving crypto in addition to Western Union and MoneyGram wires from supporters across the globe and sending the funds to Bitcoin wallets they managed. “We have been capable of detect it, partially, as a result of the defendant was additionally utilizing conventional banks. So these banks had obligations to report,” mentioned Bragg.
Robert Taylor was additionally convicted in 2024 for an unlawful Bitcoin ATM enterprise in at the very least 46 areas throughout town, the place he primarily marketed felony exercise on social media. Between 2017 and 2018, he transformed greater than $5.6 million of his clients’ money into Bitcoin whereas charging them huge charges.
Myrie added there’s additionally a proliferation of crypto scammers utilizing different know-how — like generative AI, voice mills, pretend movies, and fraudulent web sites — to prey on on a regular basis New Yorkers and susceptible populations, just like the aged or romantic hopefuls.
“There’s a explicit disgrace that’s hooked up to being scammed on this manner,” mentioned Myrie. “As a result of beneath regular circumstances, it’s exhausting for many individuals to come back to regulation enforcement if they’ve been a sufferer of a criminal offense. However think about a criminal offense that you may’t speak to your loved ones about since you are ashamed that you just have been taken benefit of. These are the sorts of circumstances that we face now.”
Adams and the NYC Token
Former Mayor Eric Adams’ NYC Token cryptocurrency is kind of probably his most controversial enterprise enterprise. A tough feat contemplating there was a time Adams was indicted by the federal authorities and going through bribery and corruption prices (now dropped). Adams launched the digital asset on Jan. 14, with its market capping at about $600 million. Inside hours of the launch, $2.5 million was pulled in liquidity. Whereas $1.5 million was later returned to the account, buyers and most people quickly slammed Adams for allegedly scamming individuals.
Myrie mentioned he’s unclear about all the main points surrounding Adams’ token and might’t for positive say that it was felony exercise that might fall beneath the CRYPTO Act.
“However it did seem like what we have now seen in different areas, the place we have now seen individuals pump up a selected foreign money or a token after which shortly take away that liquidity, leaving various individuals holding the bag because the creators make off with some cash,” mentioned Myrie. “And our legal guidelines, as they at the moment exist, don’t penalize that kind of scheme. That’s what we try to do with this regulation, to discourage this kind of exercise.”
Bragg declined to remark instantly on Adams’ crypto rip-off allegations, however mentioned that the state of affairs does “communicate to how giant the scope of the trade is.”
