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Crypto

From the erratic ups and downs in bitcoin and ethereum value, to the explosion in initial coin offerings, and the unstoppable demand for mining-ready GPUs, cryptocurrency has become an inescapable story. It's also become increasingly difficult to make sense of — as the industry expands, new currencies sprout up, and companies form overnight. Check here for the complete coverage of bitcoin, ethereum, litecoin, monero, Venezuela's petro, cryptocurrencies at large, and the ways that ICOs and the underlying blockchain technology are helping shape a burgeoning industry and giving life to a new wave of startups and entrepreneurs.

Starbucks is giving up on its NFT odyssey.

Two years ago, Starbucks announced a web3 NFT project that was supposed to expand its Rewards loyalty program by using the blockchain... somehow.

One year ago, Starbucks delivered the first paid Odyssey NFTs, selling 2,000 in twenty minutes during the same week Facebook and Instagram quit NFTs.

Now, Starbucks says the Odyssey Beta will shut down on March 31st, and I’m wondering which big brand’s NFT project will last through March 2025.


Starbucks Odyssey Beta will be coming to a close on March 31st, 2024.
It’s over.
Image: Starbucks
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The Verge
Prosecutors recommend a 40- to 50-year sentence for Sam Bankman-Fried.

The former crypto billionaire was found guilty on all seven charges he faced in November, and the judge is scheduled to deliver a sentence on March 28th. Bankman-Fried’s lawyers suggested a 5- to 6-year prison sentence but a filing submitted by the prosecution on Friday disagrees: 

While a Guidelines sentence – which would exceed 100 years, effectively a life sentence – is not necessary, the Government urges the Court to impose a sentence that underscores the remarkably serious nature of the harm to thousands of victims; prevents the defendant from ever again committing fraud; and sends a powerful signal to others who might be tempted to engage in financial misconduct that the consequences will be severe.

A sentence of 40 to 50 years is necessary to serve such purposes. 


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Twitter
Craig Wright is not Satoshi Nakamoto and did not invent Bitcoin, British judge says.

Almost eight years after Wright publicly claimed to be the digital currency’s enigmatic inventor, UK Judge James Mellor has said the “overwhelming” evidence is that this isn’t the case. In a post on X Jack Dorsey, one of the backers of the organization that brought the legal challenge against Wright, quoted the judge’s verdict:


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Andreessen Horowitz was behind Kickstarter’s doomed Web3 pivot.

According to Fortune, the crowdfunding platform got a $100 million investment from the VC firm’s crypto fund — and the 2021 deal was meant to get Kickstarter into the Web3 hype cycle.

If you recall, the pivot was a disaster: after public outrage, Kickstarter formed a community advisory council, and the company ultimately decided to shift its attention away from the blockchain.

Correction March 12th 10:56AM ET: The Web3 pivot wasn’t a formal stipulation of the deal, as initially stated.


Y’all aren’t going to believe this, but Coachella is doing NFTs again.

In 2022, Coachella sold thousands of NFTs, including 10 digital “lifetime passes.” But it partnered with FTX US, Sam Bankman-Fried’s fall took the tokens with it, and owners were left chasing their promised benefits. Now Bitcoin is back, and Coachella’s trying NFTs again.

Each $1,499 NFT in the initial collection comes with a 2024 VIP Festival Pass and access to an exclusive bar.

Of 1,024 NFTs offered, three have been minted so far.


A rendering of a multicolored “shell from a forgotten sea” shown on the field where Coachella takes place.
One of the Coachella NFTs.
Image: Coachella
The price of Bitcoin hit a new peak, rising above $69,000 today.

That’s the highest it’s been since 2021, before the long, cold crypto winter brought that price crashing down to less than $20,000.

A friendly reminder: the higher that price gets, the more energy Bitcoin mining typically burns through and the greater its greenhouse gas emissions.


A graph shows fluctuating Bitcoin prices, peaking around $69,000.
A screenshot of Bitcoin prices tracked by CoinDesk.
Image: CoinDesk
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The US Department of Energy has to start over if it wants to survey Bitcoin miners’ electricity use.

The DOE reached a settlement with crypto miners who sued to block data collection. The agency tried to make companies disclose their energy use through an emergency data request. But a federal judge placed a temporary restraining order on it in February, saying the situation probably didn’t warrant emergency authorization. On Friday, the DOE agreed to destroy information it’s already collected. It can start over without emergency authorization, but would have to propose a new survey and give the public 60 days to comment.


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The Verge
Elizabeth Warren is still pushing crypto mines to divulge their electricity use.

Warren has been urging federal agencies to scrutinize energy-hungry Bitcoin mines. But crypto groups secured a temporary pause on the Department of Energy’s survey of their electricity consumption.

“The Department is asking cryptominers to report basic information about their energy usage—like other industries have done for decades—so the public and lawmakers better understand how cryptomining’s electricity use and carbon emissions affect the power grid and environment,” Warren said in a statement to The Verge after the news came out.


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Do Kwon, the Terra / Luna creator, is coming to a U.S. courtroom to face fraud charges

He might even arrive in time for the SEC’s fraud lawsuit, which is scheduled to begin jury selection in March. He’s also facing eight criminal counts.


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Three Arrows Capital cofounder on jail: “I think it’s definitely good for you.”

That’s Su Zhu; Kyle Davies is still on the lam. But their woes may not yet be over:

Among the most incriminating evidence brought forward against Zhu and Davies is a document they sent to at least one creditor as crypto markets were collapsing in May 2022, claiming 3AC had nearly $2.4 billion under management. Both lenders and people close to the liquidators now believe this number was false, grossly overstating the fund’s assets. “We firmly believe they committed fraud.”

👀


The NFT world is consolidating.

Yuga Labs, the group behind Bored Apes, is purchasing Kevin Rose’s NFT group, Proof. Yuga previously bought CyrptoPunks, too.

As Yuga scoops up more of the NFT world, the question remains: who’s still buying? And is there anything worth doing with them?


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Larry David thinks his FTX Super Bowl ad in 2022 was a prettyyyy, prettyyy big mistake.

That was the vibe when the Curb Your Enthusiasm star called himself “an idiot” during an interview with The Associated Press recently. He was part of the glut of FTX Super Bowl 2022 ads angled on FOMO the same year FTX collapsed, and we know how that story went.

Of course, there were no crypto ads during Super Bowl LVIII — unless you count Jack Dorsey wearing a Satoshi shirt again.


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Chris Dixon’s blockchain book is number nine on the NYT bestseller list, but...

The Times marked it with a dagger, noting “institutional, special interest, group or bulk purchases” that may have helped it make the list.

Motherboard points out the label, and includes statements from Dixon’s firm a16z and a few crypto companies it invested in, all acknowledging purchasing multiple copies of a book that one reviewer said “fails to identify a single blockchain project that has successfully provided a non-speculative service at any kind of scale”


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A thorough review of Chris Dixon’s new blockchain book.

“The book is peppered with glowing references to companies a16z has backed, but is completely devoid of any disclosures.” There’s gotta be a more efficient way to hype your companies than a book, right?

Anyway this does seem like a problem for a 15-year-old technology: “Throughout the entire book, Dixon fails to identify a single blockchain project that has successfully provided a non-speculative service at any kind of scale.”


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The EPA just fined a Bitcoin-mining plant for violating coal ash rules.

Greenidge Generation, a gas-powered Bitcoin-mining operation, agreed to pay $105,000 to settle claims it violated the EPA’s coal ash program. This requires companies to follow certain groundwater monitoring rules, among other things.

Greenidge Generation started mining Bitcoin at a shuttered New York power plant that used to burn coal in 2020. It has faced pushback from state lawmakers due to concerns about its environmental impact.


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A newly-streamlined process for fake IDs says it’s using AI.

Meet OnlyFakes, a quick and easy way to help bypass cryptocurrency Know Your Customer attempts — among other uses for fake IDs.

Lots of interesting stuff in this story, but here’s what stood out to me:

While OnlyFake says it uses “neural networks” to create its fake IDs, 404 Media has not seen evidence that the service uses generative AI tools.

If you want criminals to think you’re on the cutting-edge of criminality, sprinkle some AI on your marketing!


“It’s exhausting mentally, emotionally, physically.”

That’s how Gladys Anderson describes living with noise from a crypto mine that was built by her Arkansas home, in a story published today in The New York Times.

The noise prompted her and almost two dozen others to sue the site’s owners in July. The suit alleges they suffer issues like anxiety and high blood pressure because of noise from the cooling fans necessary for the power-hungry computing that crypto mining demands.


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Coinbase is lowering prices to compete for the pros.

I mean yes, they don’t say that but come on: they are targeting high-volume traders — if you’re doing more than $500,000 monthly, I think you are maybe not a normal consumer.

Wonder if this is the beginning of a race to the bottom on fees... and who will be left standing.


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German police gained control of over $2 billion in Bitcoin associated with a piracy website.

The authorities say they’ve seized nearly 50,000 Bitcoins from an operator of Movie2K, a major piracy website that was shut down in 2013. That’s on top of the $29.7 million in Bitcoin the FBI helped German police seize from the operators in 2020.


A Razzlekhan movie is in the works about the rapper/Bitcoin money launderer.

Last summer, Heather Morgan (a Forbes blogger who also rapped under the name Razzlekhan) and her husband Ilya Lichtenstein pleaded guilty to charges they conspired to launder Bitcoin stolen from Bitfinex in 2016. At the time of their arrest in early 2022, the stolen crypto was worth $4.5 billion.

Netflix previously ordered a documentary series about the couple, and now Deadline reports that Amazon MGM Studios has started development on a Razzlekhan film inspired by this New York Times story.


Screenshot: Razzlekhan
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The company behind the failed TerraUSD stablecoin has filed for bankruptcy.

Terraform Labs filed for Chapter 11 bankruptcy on Sunday, listing assets and liabilities between $100 million and $500 million.

The company’s co-founder, Do Kwon, is facing extradition to the US following the fall of TerraUSD and its sister token Luna, which vaporized billions of dollars in 2022.


GameStop is pulling out of the NFT game.

GameStop will shut down the NFT marketplace on February 2nd “due to the continuing regulatory uncertainty of the crypto space,” reported by Decrypt yesterday.

That’s the same reason the company offered for shutting down its crypto wallet last year. The marketplace opened just a year and a half ago. The SEC was keenly interested in crypto throughout 2023, and took its first unregistered security enforcement against an NFT project in August.


A screenshot of GameStop’s message about the closure of its NFT marketplace.
GameStop ends its NFT ambitions.
Screenshot: Wes Davis / The Verge
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That crypto firm’s fake CEO is actually just some British man.

Earlier this month The Guardian reported that the CEO of a crypto firm called HyperVerse didn’t seem to be a real person: “Steven Reece Lewis” had an impressive resume, but there was no evidence he existed.

Now The Guardian has tracked down Steven Harrison, “an Englishman living in Thailand,” who was paid to appear in HyperVerse’s investor materials. He says he didn’t realize he was being used in a scam:

“I went away and I actually looked at the company because I was concerned that it could be a scam,” Harrison said. “So I looked online a bit and everything seemed OK, so I rolled with it.”


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Stablecoin issuer Circle wants to go public.

More than a year after its SPAC plan to go public crumbled, Circle has filed for an IPO. Get your engines ready, it’s S-1 time!


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Would you like a bonkers visual timeline of the decade it took to get a Bitcoin ETF approved?

It’s a delightful run through Very Recent History, with a helpful tracker of the number of submissions that happened and the price of Bitcoin. Of course, we all know how the story ends.


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What was the point of the Twitter / X hack?

“I kind of don’t understand the trade here?” Bloomberg columnist Matt Levine writes of the hack of the SEC’s Twitter account yesterday, in which a fake approval of Bitcoin ETFs was briefly posted.

Linda Yaccarino was at CES yesterday to try to talk more businesses into using Xitter. If I were a troll, using the opportunity of screwing with one of X’s core constituencies and the feds at that precise moment in time would be too good to pass up. The trade is an epic lol, I believe.


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Even X is giving up on NFTs.

The Elon Musk-owned platform quietly removed the option for Premium subscribers to use NFTs as their profile pictures, as spotted earlier by TechCrunch. X also scrubbed all mention of NFT profile pictures from its support page.

This comes a little less than one year after Meta ended tests that let users share NFTs on Instagram and Facebook.