State regulators said Thursday that the gas-powered Greenidge generation plant does not comply with New York’s climate laws.
New York state environmental regulators have declined to extend a key permit to a controversial cryptocurrency mining operation in the state’s Finger Lakes region.
The state Department of Environmental Conservation said Thursday that the gas-powered Greenidge generation plant does not comply with the state’s climate laws and declined to extend an air quality permit. The 107-megawatt plant became a flashpoint in the debate earlier this year as New York lawmakers passed a bill placing a moratorium on new permits for gas-powered crypto mining.
Gov. Kathy Hochul has yet to sign that bill. But her administration has now ruled that the Greenidge facility is out of step with New York’s 2019 Climate Leadership and Community Protection Act. The law requires emissions to be slashed statewide by 40% from 1990 levels by 2030 and 85% by 2050.
Greenidge converted the decades-old plant to natural gas in 2017 and began mining bitcoin from the facility in 2019, sparking significant backlash within the region, which is known in part for its wine production.
In a letter to Greenidge, the DEC wrote that greenhouse gas emissions from the facility had “drastically increased” since the company was issued a permit in 2016. The increase, the letter said, was driven by Greenidge altering the facility’s purpose to increasingly focus on powering proof-of-work mining. More than half of the facility’s energy production in the first six months of 2021 went toward “behind-the-meter” crypto mining, according to the DEC.
Greenidge said Thursday it will appeal the decision and, in the meantime, its operations will continue. The company said it offered a plan to reduce its emissions 40% by 2025, but state regulators declined to engage further.
“We believe there is no credible legal basis whatsoever for a denial of this application because there is no actual threat to the State’s Climate Leadership and Community Protection Act (CLCPA) from our renewed permit,” reads the statement. “This is a standard air permit renewal governing emissions levels for a facility operating in full compliance with its existing permit today. It is not, and cannot be transformed into, a politically charged ‘cryptocurrency permit.'”
The DEC’s decision marks a major victory for local environmental and other advocacy groups who led the push against using greenhouse-gas-emitting plants to power crypto mining.
“Governor Hochul and the DEC stood with science and the people, and sent a message to outside speculators: New York’s former fossil fuel-burning plants are not yours to re-open as gas-guzzling Bitcoin mining cancers on our communities,” said Yvonne Taylor, vice president of Seneca Lake Guardian, in a statement Thursday. “Now, it’s up to Governor Hochul to finish the job by signing the cryptomining moratorium bill.”
The DEC had delayed the decision multiple times and said it sifted through 4,000 comments before coming to Thursday’s ruling.
How tech is tackling climate change — and reckoning with its own impact on the planet.
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Gene Levoff, Apple’s former director of Corporate Law, pleaded guilty to insider trading, the Department of Justice announced Thursday.
Levoff has been charged with six counts of securities fraud for executing trades of Apple stock based on nonpublic information about Apple’s financial results, allowing him to make $227,000 on some trades and avoid losses of around $377,000 on others between February 2011 and April 2016. Each fraud count carries a maximum sentence of 20 years in prison, along with a $5 million fine.
Levoff was co-chairman of Apple’s Disclosure Committee, which reviewed the company’s earnings materials and SEC filings before they were made public, and “mined these materials for inside information” to guide his stock sales, the DOJ said. Levoff sold large amounts of stock when financial results were bad and bought large amounts when results were good.
While at Apple, Levoff was subject to the company’s “blackout periods,” in which employees who had access to nonpublic information were not allowed to buy or sell stock, but he ignored those restrictions.
“Despite being responsible for enforcing Apple’s own ban on insider trading, Levoff used his position of trust to commit insider trading in order to line his own pockets,” U.S. Attorney Vikas Khanna said in a statement.
Apple did not respond to request for comment from Protocol. Levoff’s sentencing is scheduled for Nov. 10.
FTX is reportedly close to gobbling up BlockFi for about $25 million, though BlockFi’s CEO has dismissed the talk as “market rumors.”
The crypto exchange is in talks to acquire crypto lender BlockFi, which has been reeling from the market downturn, according to a CNBC report published on Thursday citing unnamed sources. The Block also reported that FTX and BlockFi were close to a deal, with FTX having previously obtained an option to buy a 50% stake in the company in exchange for extending it a $250 million line of credit. FTX would pay $25 million for the remaining shares.
The deal could take a few months to close, and the final price could change, CNBC said. But BlockFi CEO Zac Prince denied the “market rumors,” saying in a tweet, “I can 100% confirm that we aren’t being sold for $25M. I encourage everyone to trust only details that you hear directly from BlockFi.”
BlockFi was last valued at roughly $4.8 billion with $1.2 billion in funding from investors that include Bain Capital, Coinbase Ventures and Tiger Global, according to data from PitchBook. A deal on the terms described in the reports would all but wipe out BlockFi’s shareholders.
BlockFi recently announced that it was slashing 20% of its workforce. Prince said in a tweet that the company had been “impacted by the dramatic shift in macroeconomic conditions.”
The crypto lender has also faced regulatory headwinds. BlockFi settled with the SEC in February over its lending products, paying a $100 million fine and agreeing to seek a registration for a new BlockFi Yield product as a security. It stopped accepting customers for its BlockFi Interest Account in the U.S. as part of the settlement.
This story has been updated with BlockFi CEO Zac Prince’s statement.
The CFPB said it has terminated a sandbox deal that gave earned wage access provider PayActiv “temporary safe harbor from liability” under key lending regulations.
The CFPB granted PayActiv “special regulatory treatment” in December 2020 to offer “earned wage access” products that would allow employees to obtain wages they already earned before payday.
PayActiv gets paid back through a payroll deduction from the employee’s next paycheck. The company makes money through fees.
The CFPB said it had informed PayActiv early this month that it was “considering terminating the approval order in light of certain public statements the company made wrongly suggesting a CFPB endorsement of its products.”
The company requested that the CFPB end the sandbox order after notifying the agency that it planned to modify its product fee model, the CFPB said.
The move underlined the CFPB’s increasingly critical view of sandbox deals that the agency said “proved to be ineffective.”
Safwan Shah, PayActiv’s founder and CEO, is credited with coining the term “earned wage access,” which has been criticized by consumer advocates as being potentially predatory, especially when it comes to workers who don’t make much money.
Shah has argued that it benefits ordinary workers, citing a dieting principle: “The less you are paid, the more frequently you should be paid,” he told Protocol in a 2021 interview. “If you’re going to eat 500 calories, don’t eat them in one sitting. Spread them throughout the day.”
Correction: This story has been updated to correct the spelling of PayActiv’s name. This story was updated June 30, 2022.
Samsung announced Wednesday that it has taken a significant step toward rolling out a next-generation manufacturing technology that has the potential to reshuffle the chip industry.
Samsung said that it had begun initial production of its three-nanometer manufacturing process, which includes the introduction of a new transistor architecture called gate-all-around, or GAA. The new gate architecture reduces power consumption, while at the same time boosting performance — characteristics that set chips made with it apart from others.
With any new chip manufacturing technology, just printing a few wafers doesn’t count as a win. To be successful, Samsung will have to scale the 3-nanometer process to high-volume production, which means hundreds of thousands or millions of chips.
Samsung didn’t announce any customers for the new manufacturing method, which will be geared toward mobile and high-performance computing chips such as the ones found in Samsung’s mobile phones. That’s notable because there have been multiple reports that Samsung has lost big customers such as Qualcomm because its fabs can’t produce working chips at the cadence required by high-volume customers.
Intel has said it plans to introduce the new gate design at high volume in 2024, and it was the first to optimize the transition to the current generation about decade ago. TSMC expects chips using the new gates to begin production in 2025, suggesting that executives predict that its adoption of another important manufacturing technology called extreme ultraviolet lithography, and other techniques, will be sufficient to boost performance until then.
Amazon has censored search results related to LGBTQ+ products in the United Arab Emirates after being pressured by the government.
Among the products restricted within the country are chest binders, LGBTQ+ flags and books such as Maia Kobabe’s “Gender Queer: A Memoir.” The UAE criminalizes same-sex sexual acts, and offenders can face up to 14 years in prison.
It is unclear what kind of sanction Amazon would have received if it had refused the demand.
On Wednesday, Amazon spokesperson Nicole Pampe told The New York Times, which first reported the restrictions, “As a company, we remain committed to diversity, equity and inclusion, and we believe that the rights of L.G.B.T.Q.+ people must be protected. With Amazon stores around the world, we must also comply with the local laws and regulations of the countries in which we operate.”
This is emblematic of a situation in which Big Tech supports LGBTQ+ rights at home but acquiesces to the slightest challenge abroad. Protocol has previously reported about how Google and Twitter have remained silent on a new anti-LGBTQ+ bill proposed in Ghana’s parliament that would prohibit social media users from discussing LGBTQ+ life in a positive manner or advocating for the community.
Google and Twitter have established offices in Ghana, and activists have called on them to help kill the bill.
But even at home, some corporations including Amazon have been accused of “pinkwashing,” in which major corporations present themselves as supportive of LGBTQ+ communities but often donate to anti-LGBTQ+ politicians.
For Pride Month, Amazon encouraged prospective employees to “Bring your whole self to work, every day. At Amazon, we’re dedicated to build a better workplace for our LGBTQIA+ employees.”
However, the company was banned from the Pride parade in its hometown of Seattle because of “their financial donations to politicians who actively propose and support anti-LGBTQIA+ legislation, oppose pro-LGBTQIA+ and other human rights legislation, and for allowing anti-LGBTQIA+ organizations to raise funds from their AmazonSmile program,” Seattle Pride organizers said. “We simply cannot partner with any organization actively harming our community through the support of discriminatory laws and politics.”
Grayscale is suing the U.S. Securities and Exchange Commission after the regulator denied the company’s bid to convert its bitcoin trust into an exchange-traded fund.
The SEC late Wednesday published a notice that it had rejected Grayscale’s request, saying it did not meet legal standards designed to protect investors. Grayscale announced shortly after that it had filed a lawsuit in the U.S. Court of Appeals for the D.C. Circuit.
“Through the ETF application review process, we believe American investors overwhelmingly voiced a desire to see GBTC convert to a spot Bitcoin ETF, which would unlock billions of dollars of investor capital while bringing the world’s largest Bitcoin fund further into the U.S. regulatory perimeter,” said Michael Sonnenshein, Grayscale’s CEO. “We will continue to leverage the full resources of the firm to advocate for our investors and the equitable regulatory treatment of Bitcoin investment vehicles.”
The company had been hinting for weeks that it would sue if the SEC denied its application. Earlier this month, Grayscale brought on some major legal firepower by hiring Donald Verrilli, who served as solicitor general during the Obama administration, as a legal strategist.
“The SEC is failing to apply consistent treatment to similar investment vehicles, and is therefore acting arbitrarily and capriciously in violation of the Administrative Procedure Act and Securities Exchange Act of 1934,” Verrilli said in the company’s press release.
The rejection marks the latest piece of bad news for the industry. Bitcoin has seen its market value fall by more than 70% from a peak in November near $70,000.
Grayscale filed for approval in October to convert its bitcoin trust, GBTC, into a spot ETF, a move it said would broaden access to the cryptocurrency by offering a fund based on holding the asset rather than its futures. Launched in 2013, GBTC holds about $13 billion in assets.
Grayscale told the SEC in May that converting the trust into an ETF could unlock about $8 billion for investors.
The SEC has previously declined similar attempts from other companies to hold bitcoin directly in an ETF rather than through bitcoin futures contracts.
App developers in South Korea can now use third-party payment systems, Apple announced in a blog post Thursday.
The change is Apple’s response to legislation in South Korea that prevents app store operators from forcing developers to use their own in-app payment systems. Now, developers can use alternatives and bypass Apple and Google’s 30% commission by accepting money directly from consumers. The law was an amendment to South Korea’s Telecommunications Business Act, passed last summer.
The law frustrated Apple and Google at the time — both lobbied the Biden administration to intervene — and ultimately both companies have since complied, though South Korean lawmakers have taken issue with Google’s implementation because it still imposes high fees on developers that opt to use an alternative system. Apple initially argued the rule would open the door for fraud, undermine user privacy and make it harder to manage payments.
Developers can now use Apple’s so-called “StoreKit External Purchase Entitlement,” which lets apps distributed on the App Store in South Korea offer an alternative payment option, to comply with the new law. “Developers who want to continue using Apple’s in-app purchase system may do so and no further action is needed,” Apple wrote in the blog.
Apple also said developers who choose to use external payment systems won’t be able to use features like Ask to Buy or Family Sharing because the company can’t validate payments that occur outside the App Store’s “private and secure payment system.” The company also can’t help with refunds, purchase history , subscription management and other issues users may face by using third-party systems. “You will be responsible for addressing such issues,” Apple wrote in the blog.
In a separate document, Apple details how, like Google, it still intends to charge a high commission — in this case, 26% — for transactions outside its payment system. Developers are responsible for reporting sales to Apple on a monthly basis in order to pay the requisite fees. “Apps that are granted an entitlement to use a third-party in-app payment provider will pay Apple a commission on transactions,” the company explained. “Apple will charge a 26% commission on the price paid by the user, gross of any value-added taxes. This is a reduced rate that excludes value related to payment processing and related activities.”
Other countries have begun to target Apple’s in-app payment systems. The Dutch Authority for Consumers and Markets ordered Apple to allow dating app developers in the Netherlands access to third-party payment systems, which Apple complied with after several fines. The European Union’s Digital Markets Act includes rules for Apple to let users install apps from external sources, while a U.S. judge ruled last year that Apple must tell customers about alternative payment methods as a result of Fortnite maker Epic Games’ antitrust lawsuit. Apple appealed that decision.
An employee working for OpenSea’s email delivery vendor misused their customer data access to download and share email addresses with an “unauthorized external party,” the NFT marketplace wrote in a company blog post Wednesday. The employee worked for Customer.io.
OpenSea said customers who have shared their emails in the past “should assume” they were affected and will receive an email from opensea.io with more information. Customer.io launched an investigation into the issue, and the incident was reported to law enforcement.
“Your trust and safety is a top priority,” OpenSea wrote. “We wanted to share the information we have at this time, and let you know that we’ve reported the incident to law enforcement and are cooperating in their investigation.”
It’s unclear how many customers were affected, although some people tweeted that they had received an email from OpenSea notifying them that they were impacted. It’s also unclear if the employee still works for Customer.io.
Customer.io said it took “immediate steps” to investigate as soon as it learned of the incident, including hiring a third-party forensic investigations team. The employee behind the incident was suspended and has had all access to email information removed.
“We are working closely with OpenSea and are reviewing exactly how these email addresses were compromised,” a representative for Customer.io said in a statement. “We believe this resulted from the actions of an employee who had role-specific access privileges that were abused. We do not believe any other clients’ data has been compromised, but we are continuing to investigate.”
Earlier this month, a former OpenSea product manager was charged with wire fraud and money laundering in the first-ever insider trading charge involving digital assets. The employee bought NFTs before they were publicly featured on OpenSea’s site and sold them for two to five times the price of his original purchase.
This story was updated to include a statement from Customer.io sent after publication.
Javier Soltero is leaving Google Workspace, Google Cloud CEO Thomas Kurian announced Wednesday in an email to staff viewed by Protocol. Soltero will leave his role effective July 15.
Soltero confirmed his plans on Twitter, saying, “I am proud of what we’ve accomplished during this time & confident [sic] the Workspace team, its leaders, and our strategy.”
Soltero originally joined Google’s G-Suite team in 2019 after leaving Microsoft, where he ran product strategy for Microsoft Office. Soltero became a Microsoft employee when the company acquired his email startup, Acompli, in 2014. From there he rose through the ranks from general manager of Outlook Mobile to corporate vice president of the Office Product Group.
Google then hired Soltero to try and run the Microsoft playbook with what used to be known as G-Suite, as the company pushed further into the office productivity space. In his role as vice president and general manager, Soltero reported directly to Kurian and managed the company’s full suite of productivity and collaboration tools, which includes Gmail, Calendar, Drive, Docs, Slides and Meet.
In October of 2020, just a year after Soltero joined Google, the company rebranded its suite as Google Workspace. Then in February of this year, Google launched a free business version of Workspace, meant to capture small businesses and teams within larger companies.
Both moves were a part of Google Cloud’s overall strategy to increase adoption of its productivity suite among consumers and enterprises. Under Soltero’s leadership that has happened: Monthly active users of Google Workspace have grown more than 50% over the last three years, according to Kurian’s email.
Aparna Pappu, who is currently the vice president leading engineering for Workspace, will assume the role of general manager leading Google Workspace after Soltero’s departure, Kurian said in the email.
“After such an intense sprint, it’s time for me to take a break before I figure out what is next,” Soltero said on Twitter. “I am an entrepreneur at heart & want to take time to explore new things to build.”
This story was updated with additional information that became available after it was published.
San Francisco-based game development tools provider Unity is laying off hundreds of employees, according to a report from Kotaku.
Word of the layoffs appears to have begun surfacing earlier this week on the anonymous workplace platform Blind, with numerous users claiming to work for Unity saying management was pulling employees into Zoom meetings on Tuesday to announce they were being let go. Kotaku, citing multiple sources, now says the layoffs number in the hundreds.
According to Kotaku, Unity CEO John Riccitiello told employees two weeks ago that the company was on solid financial footing and would not be resorting to layoffs. The cuts are affecting employees all around the globe, the report says.
Unity confirmed the layoffs in a statement to Protocol and said slightly more than 200 people were affected. “As part of a continued planning process where we regularly assess our resourcing levels against our company priorities, we decided to realign some of our resources to better drive focus and support our long-term growth. This resulted in some hard decisions that impacted approximately 4% of all Unity workforce. We are grateful for the contributions of those leaving Unity and we are supporting them through this difficult transition.”
Unity employed 5,245 people as of December 31, 2021, indicating the company had nearly doubled its workforce since the year it went public. It’s also made a number of high-profile acquisitions since going public two years ago, including its largest ever when it purchased New Zealand-based digital effects studio Weta Digital for more than $1.6 billion last November.
However, the company’s stock price has fallen more than 40% since its 2020 debut, and more than 70% this year alone. The company also reported a loss of eight cents a share in its most recent quarterly earnings report and lowered its fiscal year guidance. Some employees have said the firm enacted a hiring freeze earlier this year, though it has not publicly said so.
Unity mainly competes with open source or free game development tools, in-house game engines used by major developers and with Fortnite creator Epic Games, which distributes its Unreal Engine platform for making high-fidelity 3D games. While a number of high-profile developers, including Electronic Arts subsidiary BioWare and The Witcher developer CD Projekt Red, have signed up to use Epic’s new Unreal Engine 5, Unity mostly caters to the mobile and indie game market, where it makes money through licensing and also through providing in-game advertising tools to free-to-play developers.
Unity also been trying to break into the Hollywood VFX industry, where it competes with both established digital effects studios and Epic, which has been making efforts to do the same with Unreal Engine. Despite its strong foothold in the mobile game segment, however, Unity does not develop games of its own and as a result does not have additional revenue streams outside its engine licensing business, ad unit and other related software products.
Update June 30, 9AM ET: Added statement of confirmation from Unity.
Niantic is reportedly cutting between 85 and 90 staff members, or 8% of its workforce.
The company also canceled four of its upcoming projects: Heavy Metal, Hamlet, Blue Sky and Snowball. CEO John Hanke said in an email to employees that the company has been cutting costs in several areas as it is “facing a time of economic turmoil,” Bloomberg reported Wednesday, and that the company needs to “further streamline our operations” to weather “economic storms that may lie ahead.”
Niantic’s biggest title, Pokémon Go, has raked in more than $1 billion per year. But none the company’s subsequent games have achieved the same level of success. In a statement to Bloomberg, the company said it was cutting staff and production to “focus on our key priorities.”
Earlier this week, Niantic announced that it’s partnering with the NBA for an upcoming game called NBA All-World. The company said that this game is still in production.
Crypto hedge fund Three Arrows Capital has reportedly received a court order to liquidate after creditors sued the company over unpaid debts.
A court in the British Virgin Islands signed an order to liquidate Three Arrows on June 27, Sky News first reported early Wednesday. The hedge fund had a reported $3 billion in assets under management as of April but has been hit hard by collapsing cryptocurrency values.
Three Arrows did not immediately respond to a request for comment. Partners from advisory firm Teneo will advise the liquidation process, according to Sky News.
On Monday, Voyager Digital said Three Arrows defaulted on a crypto loan worth $666 million.
The total value of the crypto market has sunk by about $2 trillion since peaking in November, falling below $1 trillion earlier this month for the first time since January 2021, according to CoinMarketCap.
Three Arrows, also known as 3AC, bet heavily on luna, the token tied to Terraform Labs’ UST stablecoin, helping lead a $1 billion purchase of the cryptocurrency in February. Three months later, UST lost its peg to the dollar and the value of luna sank, one of the most significant collapses of the current crypto crash.
Concerns about Three Arrows’ solvency have been circulating in the weeks since. The Financial Times reported on June 16 that the firm had failed to meet several margin calls. Kyle Davies, Three Arrows’ co-founder, told the Wall Street Journal earlier this month that the firm is “committed to working things out and finding an equitable solution for all our constituents,” including the possibility of asset sales and a rescue by another firm.
Just months after committing to spend $925 million on carbon dioxide removal, a collection of major tech companies has announced its first purchases. The group, operating under the banner of Frontier, announced it had purchased nearly 2,000 tons of CDR services from five companies. It’s a small ripple in the CDR pond, but one Frontier hopes will turn into a wave to bring down the costs of removing carbon.
The five companies in question — Lithos Carbon, Calcite-Origen, AspiraDAC, RepAir and Travertine Tech — all use a variety of techniques to pull carbon from the sky. The partnership between Calcite-Origen, AspiraDAC and RepAir, for example, uses direct air capture, while Lithos Carbon and Travertine rely on improving rock weathering to pull carbon dioxide from the air. The group also gave Living Carbon, a synthetic biology company, an R&D grant to further work on carbon removal using algae and biopolymers. The five purchases plus the grant reflect Frontier’s approach to let a thousand carbon removal flowers bloom to see what sticks.
Frontier came online in April. Stripe, Alphabet, Shopify, Meta and McKinsey pooled $925 million to form what’s dubbed an advance market commitment. In essence, they’re promising to buy CDR services with the hopes of spurring innovation in the field, which can help bring down the cost. The First Movers Coalition, another collection of companies and governments, has similarly said it will buy hundreds of millions of dollars in CDR services with the same intent to kickstart the market and innovation.
Right now, sucking carbon from the sky is expensive. Among the projects in Frontier’s first purchases, the cost to remove a ton of carbon ranges between $500 and $1,800. That’s well above the holy grail of $100 per ton price point that would make CDR (relatively) affordable given the world will potentially need to remove billions of tons of carbon dioxide a year depending on how fast we collectively stop chucking the stuff into the atmosphere.
“We look for durable carbon removal solutions that have the potential to be low-cost and high-volume in the future, even if they’re not today,” Joanna Klitzke, who leads Strategy and Operations for Frontier, said in an email. She noted that while Calcite and Origen’s technique currently clocks in at $1,800, the duo projects it could dip below $100 per ton as it scales. (Calcite also recently won the first stage of the CDR XPRIZE, sponsored by Elon Musk, so clearly Frontier isn’t the only group that believes in the technology.)
Frontier is betting on that scaling happening, and the companies have until 2027 to deliver the agreed-upon tons. But Klitzke also said if some of these groups don’t hit their targets, Frontier is “comfortable” with that. “We’re the first customer for all six of these projects because we’re trying to help get as many projects as possible to the starting line,” she said.
The group plans to make larger, multiyear offtake agreements down the road in addition to smaller purchases, like the first round, to keep the innovation pipeline fresh. While Klitzke said R&D won’t be a major focus, Frontier saw Living Carbon’s technique as “an exciting pathway for carbon removal that we want to see develop,” and other grants may be forthcoming if the team dubs an early-stage carbon removal approach novel enough.
Frontier’s purchases are important given the almost certain need for some amount of CDR to keep the planet from heating to dangerous levels. But they are not a reason for decision-makers to be lulled into complacency around actually cutting emissions. The roughly 2,000 tons of removal services in Frontier’s first round of purchases is equal to less than two seconds’ worth of humanity’s yearly carbon emissions.
Scaling the cheap carbon-cutting solutions we already have today such as renewables, bike lanes and heat pumps has never been more important. Because ultimately, the cheapest ton of carbon to remove from the atmosphere is the ton that doesn’t end up there in the first place.
The Federal Trade Commission has sued Walmart, alleging the retail giant “turned a blind eye” to fraud worth hundreds of millions on its money transfer services.
The lawsuit, filed Tuesday in Illinois Federal Court, says that Walmart did not properly train employees or put procedures in place to prevent fraud on transfer services offered within its stores, despite being aware of the risk for fraud. Nearly $200 million in payments subject to fraud complaints was sent or received at Walmart from 2013 to 2018, according to the FTC, citing fraud databases maintained by MoneyGram, Western Union and Ria. Another $1.3 billion in related payment could be tied to fraud, according to the FTC.
“While scammers used its money transfer services to make off with cash, Walmart looked the other way and pocketed millions in fees,” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection.
The FTC said it found several instances where scammers relied on Walmart’s money transfers as a primary way to receive payments. That includes in telemarketing scams, IRS impersonation schemes, relative-in-need “grandparent” scams and sweepstakes scams, among others. Walmart offers transfers directly and through partnerships with MoneyGram, Ria and Western Union.
The FTC noted in the release that it has previously pursued cases against money transfer services alleging a failure to protect consumers from fraud, including against MoneyGram and Western Union.
In a statement published shortly after the FTC announced the case, Walmart called the complaint “factually flawed and legally baseless.”
“Claiming an unprecedented expansion of the FTC’s authority, the agency seeks to blame Walmart for fraud that the agency already attributed to another company while that company was under the federal government’s direct supervision,” Walmart’s statement said. “Walmart will defend the company’s robust anti-fraud efforts that have helped protect countless consumers, all while Walmart has driven down prices and saved consumers an estimated $6 billion in money transfer fees.”
The FTC said it will ask the court to require that Walmart return money to customers and impose civil penalties against Walmart.
Eric Schmidt described his first five years at Google as “pure, naive techno-optimism,” in that the company believed that applying American values like free speech is good for the world. But Google hit a brick wall when it bought YouTube.
“We learned the lesson that you cannot go and impose your American values on countries, even if you don’t like it,” Schmidt said at an Aspen Ideas Festival panel Tuesday. “And then we face this question of: Do you stay or leave?”
Schmidt, former State Department official Anne-Marie Slaughter and IBM SVP and director of Research Darío Gil talked about tech’s role on a global stage at a panel moderated by former POLITICO Magazine editor Garrett Graff. They said the war in Ukraine, the COVID-19 pandemic and other worldwide issues have tested tech’s ability to expand on a global scale.
Schmidt said a decade ago, tech companies likely would not have taken down false information about COVID-19. But when the pandemic began to spread and platforms began removing false information about the virus, companies set a precedent for taking down content — but without rules to guide it. “Now we’re in this horrific state where we’ve set the precedent that we’re willing to edit or change the textbook, change the content, but we don’t have any rules,” he said.
He said the U.S. lacks a government playbook for addressing misinformation. He cited the U.K.’s Online Safety Bill, which proposes a framework for removing harmful (but legal) information. “That’s an example of how Britain, which is certainly a democracy, is going to solve this problem. Who knows what harmful but legal harmful is? How do you decide?” Schmidt said.
Panelists also talked about tech’s response to the war in Ukraine. Slaughter, currently the CEO of New America, said the implications of tech companies cutting ties with Russia is “enormous.” Slaughter said tech companies are starting to act as “independent foreign policy actors” in their decisions on global issues, citing Airbnb’s program to house people fleeing Ukraine.
“Suddenly, you’re seeing corporate and civic actors playing a role alongside government,” she said.
Gil said that as companies and governments increasingly work together, they’re going to need to make decisions about which governments to work with. “You’re going to have to make and operate under the new regime of alliances between countries that have elevated technology as a key source of strategic and competitive advantage,” Gil said. “So I think the rules are going to be sharper.”
Gil added that companies need to make choices about “what you do with the most advanced technologies” and which technologies are of top concern. For Gil, the top five include semiconductors, artificial intelligence, quantum, cyber and biotech. “There is definitely a marked difference about what you do, where you do it, with whom you do it.”
The Biden administration’s hot electric vehicle summer continues to zip along. On Tuesday, the White House announced $700 million in commitments for EV charging from private companies. The cash will up U.S. charging manufacturing capacity to 250,000 chargers a year and increase the number of chargers out in the wild. Not too bad!
The announcement includes $450 million from Volkswagen and Siemens to backstop the Electrify America charging network. (Fun fact: It’s an outgrowth of Dieselgate.) Siemens represents the first outside investor to put money into the network, and the investment will spur the, in the White House’s words, “rapid deployment of up to 10,000 ultra-fast chargers at 1,800 charging stations.” Though the deployment doesn’t come with a concrete timeline, getting that many fast chargers in the ground could ease range anxiety, a top concern for would-be EV owners.
In addition, Siemens committed $250 million to expand its EV charger manufacturing operations in the U.S. All told, the company plans to crank out 1 million chargers over the next four years. The company and the White House didn’t specify how many of those would be fast chargers, but regardless, even slower chargers for home and errands could be key to making sure EV owners can always be on the go without the worry of their cars dying without a charger in sight.
The timing comes a few weeks after the Biden administration announced EV charging standards that could help make a national, more unified network of chargers a reality as opposed to today’s piecemeal approach. And hot EV summer will continue into August when states submit plans for how they’ll use the $7.5 billion in EV charging cash available through the bipartisan infrastructure law. That money is meant to spur private investments as well, and it seems to be doing just that. Which hey, isn’t it nice when something works as intended?
The money committed is vital for getting Biden’s vision of a 500,000-charger-strong network off the ground, but it’s also nowhere near enough for ensuring the end of the internal combustion engine for the sake of the climate. A number of think tanks have modeled what a true EV revolution would take finance-wise, and the answer is billions of dollars a year in sustained investment for at least the next decade.
Beyond charging infrastructure, tax credits and other policy tools are needed to bring down the cost of EVs so they’re accessible to all households. Investing in infrastructure like mass transit and bike lanes as well as improving mixed-use zoning so we don’t need cars to get everywhere in the first place are also strategies policymakers need to consider in order to help reduce transportation emissions and not put too much strain on the supply chain for critical minerals we’ll need as the world electrifies everything. (Oh, and those moves would also improve public health and quality of life.)
Meta said it’s working to correct enforcement errors that led to the removal of Facebook posts related to abortion pills and suspensions of user accounts behind the posts. The clarification came after Motherboard discovered that Facebook was instantly removing posts that said “abortion pills can be mailed,” which the FDA legalized in 2021.
“Content that attempts to buy, sell, trade, gift, request or donate pharmaceuticals is not allowed. Content that discusses the affordability and accessibility of prescription medication is allowed,” Meta spokesperson Andy Stone tweeted in response to the story. “We’ve discovered some instances of incorrect enforcement and are correcting these.”
Facebook’s policies prohibit “attempts to buy, sell or trade pharmaceutical drugs,” except when the seller is a “legitimate healthcare e-commerce business.” These policies have been constantly evolving over the years, particularly in light of the pandemic, which opened the door to telehealth services across the U.S. Now telemedicine is expected to play an important role in providing abortion care to people in states where abortion will be banned or severely restricted. And the ability to share information online about accessing abortion pills by mail is critical to that work.
Still, Facebook and other online platforms are now operating in uncharted legal territory, where individual states are seeking to outlaw mailing the abortion pill mifepristone, while Attorney General Merrick Garland has said such bans are prohibited. That could set up another legal fight between states and the federal government.
Even as Facebook works to correct whatever enforcement problems led to the abortion pill posts being blocked, Meta and other platforms must also grapple with what to do about abortion misinformation, including a slew of Facebook ads that claim abortion pills are reversible or dangerous, despite medical guidance to the contrary. Meta spokesperson Dani Lever previously told Protocol that ads and posts about abortion will be eligible for fact-checking by third parties.
“Posts debunked by our independent third-party fact-checking partners will appear lower in Feed, be filtered out of Explore on Instagram and be featured less prominently in Feed and Stories so fewer people see them,” Lever said. “We also prohibit ads that include misinformation, mislead people about the services a business provides or repeatedly use shocking imagery to further a point of view.”
Option Impact, a benchmark compensation product from Advanced-HR, has a new owner.
Pave, a fast-growing Option Impact competitor, announced Tuesday that it had bought Advanced-HR from Morgan Stanley. The acquisition came as Pave announced its $100 million Series C funding round led by Index Ventures.
The tech talent market is still highly competitive, and startup leaders rely on each other’s data to gauge how much they need to pay in order to recruit and retain employees. Pave’s selling point is that rather than surveying companies once a year, it integrates their HR software like BambooHR, Carta and Greenhouse so that customers can access real-time compensation data.
The purchase followed what Pave founder and CEO Matt Schulman described as a “very competitive bidding process” for Advanced-HR. In addition to the popular tool Option Impact, Advanced-HR’s product suite also includes Option Driver and the Venture Capital Executive Compensation Survey. Pave didn’t announce what it had paid for Advanced-HR.
“We view this as a kind of a space-race opportunity. It’s a question of who gets the data asset first,” Schulman told Protocol. “We have a strong conviction we’ll win this new content market that has opened up.”
Pave, which has grown to 150 employees and 2,500 customers since Schulman founded it in 2019, is now valued at $1.6 billion. Post-acquisition, Pave has more customers than any other compensation benchmarking database for private tech companies, Schulman said.
Those customers will now have access to Option Impact’s data from more than 2,200 startups within Pave, which Schulman said offers a better user interface, better integration and its own set of real-time comp data.
Pave and Option Impact have both historically served venture-backed companies up through the Series C or Series D phase. Later-stage companies are more likely to use compensation data from Radford, which is owned by the professional services giant Aon.
But Schulman said he ultimately aims to offer compensation data to more mature companies as well, given “how interconnected the labor market is.” As a Series C company, Pave is no longer just competing for engineers against seed-stage and Series A companies — it’s going up against Meta, DoorDash, Uber, Netflix and Amazon, Schulman said.
“We have an interest in understanding what people are getting paid in the early-stage market as well as the late-stage, public market,” Schulman said. “It is very valuable to have all that information in one place, instead of needing to go to different datasets with different standards, different frameworks, etc.”
In addition to Index Ventures, which now has a Pave board seat, Pave’s Series C round included investment from Andreessen Horowitz, the YC Continuity Fund, LocalGlobe, Craft Ventures, Original Capital, Backend Capital, Contrary Capital, former LinkedIn CEO Jeff Weiner and former Facebook Vice President of HR Tudor Havriliuc.
FTX is reportedly exploring the possibility of buying Robinhood. The crypto exchange led by CEO Sam Bankman-Fried is looking into whether it could acquire the online brokerage, according to a Bloomberg report that cited unnamed sources.
No final decision has been made, the report said. Bankman-Fried also downplayed the report in a statement to Bloomberg saying, “There are no active M&A conversations with Robinhood.” In filings, Bankman-Fried revealed in May that he personally held a 7.6% stake in Robinhood.
Robinhood had no comment on the report, which sparked a rally in the company’s shares. The stock closed up 14% Monday, helped as well by a Goldman Sachs analyst report upgrading it from sell to neutral.
Goldman noted that Robinhood’s stock price had plunged about 29% since it was downgraded to sell in April and it was reaching “a reasonable fundamental floor for the value of the company.”
Backstage Capital, which invests in underrepresented founders, has cut all of its operational staff after it ran into fundraising challenges, according to founder Arlan Hamilton.
Hamilton spoke Sunday on her podcast about the changes, which reduced its staff from 12 to three. Besides Hamilton, the other two who remain are general partners Christie Pitts and Brittany Davis, who are working on a “special project,” Hamilton said.
In May, Backstage announced that it had stopped making new investments and would only make follow-on investments. But it said it was still seeking to raise a $30 million opportunity fund.
The firm, which has invested in 200 companies, has raised about $20 million over its six and a half years, Hamilton said on the podcast. Backstage was one of the earliest firms focusing on minority and underrepresented founders, who have traditionally faced challenges raising funding in the venture industry.
Backstage also raised close to $5 million in a crowdfunding campaign through Republic. That funding gave investors a stake in the Backstage management company, but not Backstage’s investment funds. The crowdfunding campaign’s disclosures anticipated that 30% of the money raised would go to paying off accumulated debt.
Hamilton, in the podcast Sunday, described challenges raising funds from entities including Apple, J.P. Morgan and PayPal, while praising Comcast for providing funding.
The firm’s operating budget was about $3.5 million to $4 million per year, Hamilton said in the podcast, adding that she would put up about a third of the funds herself. Hamilton has invested in 26 emerging managers as an LP, she said on the podcast.
“It’s not that I feel like there’s any sort of failure on the fund side, on the firm side. It’s that this could’ve been avoided if systems we work within were different,” Hamilton said on the podcast.
Crypto hedge fund Three Arrows Capital has defaulted on a loan of cryptocurrencies worth $666 million from Voyager Digital, the broker said Monday.
Voyager Digital said it has issued a notice of default to the hedge fund for failing to make payments on a loan of 15,250 bitcoin and $350 million USDC. Voyager ”intends to pursue recovery from [Three Arrows] and is in discussions with the company’s advisors as to legal remedies available,” the company said in a statement.
“We are working diligently and expeditiously to strengthen our balance sheet and pursue options so we can continue to meet customer liquidity demands,” Voyager CEO Stephen Ehrlich said in a statement.
Voyager stressed that it “continues to operate and fulfill customer orders and withdrawals,” noting that it had roughly $137 million in cash and “owned crypto assets on hand.”
The company had also obtained a revolving line of credit from Alameda Ventures, an affiliate of FTX CEO Sam Bankman-Fried’s Alameda Research. That line provides access to 15,000 bitcoin and $200 million in cash and USDC.
News of Three Arrow’s default underscored the gravity of the cryptocurrency market crash. The crypto market has shed $2 trillion in the past seven months as the price of bitcoin has plunged from about $67,000 in November to roughly $20,000 this week. Three Arrows had bet heavily on luna, the token tied to Terraform Labs’ UST stablecoin, in February, helping lead a $1 billion purchase of the cryptocurrency in February. That bet dragged Three Arrows and other firms down as UST and luna collapsed.
Goldman Sachs has joined efforts to assist the ailing crypto lending company Celsius, in what would be the biggest effort yet by a traditional financial institution to jump in amid a broad crypto crash. Several large crypto hedge funds, lending companies and brokerages have sought funding or credit amid a liquidity crunch in recent days.
Goldman is aiming to raise $2 billion to buy Celsius’ distressed assets if there is a bankruptcy filing, according to CoinDesk. The investors could be crypto funds or more traditional asset managers or distressed investors.
Celsius has already brought in law firm Akin Gump Strauss Hauer & Feld and restructuring firm Alvarez & Marsal, the The Wall Street Journal reported, as well as Citigroup to advise on possible restructuring, per The Block. Citi and Akin Gump have recommended that Celsius file for bankruptcy, CoinDesk reported.
Celsius earlier this month stopped all withdrawals and transfers amid concerns about market conditions and liquidity issues, pushing the larger crypto market further down amid fears of contagion.
The lending company held an unknown amount of UST, the stablecoin that collapsed after losing its peg to the dollar, as well as staked ether, or stETH, which also has suffered from liquidity challenges amid a broader crypto crash.
Meanwhile, crypto lender BlockFi secured a $250 million line of credit from FTX. Publicly traded crypto broker Voyager Digital secured $485 million in loans from Alameda Research and limited customer withdrawals after announcing its exposure to another troubled hedge fund, Three Arrows Capital.
Los Angeles could become the first major city in the country to ban the construction of new gas stations because of the climate crisis.
The move was announced by Los Angeles city council member Paul Koretz, who is drafting the policy. If approved, the measure will ensure that there will be no additions to the nearly 600 gas stations already in the county. “We are ending oil drilling in Los Angeles. We are moving to all-electric new construction. And we are building toward fossil fuel-free transportation,” Koretz said in a press release. “Our great and influential city, which grew up around the automobile, is the perfect place to figure out how to move off the gas-powered car.”
Los Angeles is not the first city to consider this ban. Petaluma, a small city 40 miles north of San Francisco, implemented a ban on new gas stations last year. “The actual motivation for this was — and is — our climate emergency resolution and the fact that we’re really trying to shift the needle in our town,” Petaluma Mayor Teresa Barrett told the LA Times in March 2021 when the ban was first announced.
The new proposal has a degree of added urgency. Gas prices are soaring to record highs, and the spike in price has actually been a challenge for gas station owners. According to the National Association of Convenience Stores, “the average fuel retailer today makes about 10-15 cents per gallon selling gas.”
The proposal comes amid a flurry of activity in recent years to bring about more widespread adoption of electric vehicles. Gov. Gavin Newsom issued an executive order in 2020 that requires all new cars and passenger trucks sold in California to be zero-emission vehicles by 2035. More recently, the Biden administration set a national target of having 50% of all new auto sales being EVs by 2030. It has also begun to dole out money and roll out standards for a 500,000-strong EV charging network across the country.
A recent forecast from BCG found that up to 68% of new vehicles could be battery-electric by 2035. Though more bullish than other analyses, the BCG forecast shows why new gas stations aren’t only a risk to the climate. They could be a risk to owners, who could be left holding stranded assets as the EV revolution takes off full steam. It’s also a reminder policymakers will need to figure out what to do for existing gas station owners and workers as their customer base shrinks in the coming decades.
Six of Sony’s internal game development studios have issued public messages of support for abortion rights and condemnations of the U.S. Supreme Court’s overturning of Roe v. Wade on Friday. It’s a notable shift for PlayStation, after Sony Interactive Entertainment CEO Jim Ryan told staff in May to “respect differences of opinion” on reproductive rights following POLITICO’s disclosure of details from a leaked draft opinion in early May.
The Last of Us developer Naughty Dog and God of War developer Santa Monica Studio issued public messages via corporate Twitter accounts both supporting abortion rights and pledging to provide assistance to employees to support out-of-state medical needs. Spider-Man developer Insomniac Games, Days Gone developer Bend Studio, Horizon Zero Dawn studio Guerilla Games and Ghost of Tsushima creator Sucker Punch Productions all posted general messages of support for abortion rights as well.
The game industry has been largely silent on the issue of abortion rights over the past month and a half, despite countless studios and publishers issuing statements of support and donating to various causes over the past few years, ranging from Black Lives Matter to anti-Asian hate. One of the first and only developers to speak out for reproductive rights was Destiny developer Bungie, which is in the process of being acquired by Sony. (Bungie also reiterated its support in a blog post on Friday and said it is now “implementing a travel reimbursement program for any employee to use when they or a dependent cannot get access to the healthcare they need where they live.”)
No other major studios with the exception of Microsoft-owned Double Fine spoke up in similar fashion. And despite Bungie’s statement, Sony reportedly prohibited its internal studios from making similar statements following Ryan’s email to staff.
Either that policy has changed given Friday’s news, or the studios have chosen to defy Sony headquarters.
“We believe that bodily autonomy and reproductive freedom are fundamental human rights,” wrote Santa Monica Studios on Twitter earlier Friday. Naughty Dog Co-president Neil Druckmann also posted a screenshot to his account showing a $10,000 donation to NARAL and thanked Sony for matching his donation, indicating Sony may now have a company-wide policy in place for matching donations to abortion rights groups.
Insomniac’s public statement may be the most noteworthy, however, because its chief executive explicitly told employees in May that Sony was prohibiting them from speaking out about the issue, according to a report from The Washington Post. “[Sony Interactive Entertainment] will not approve ANY statements from any studio on the topic of reproductive rights. We fought hard for this and we did not win,” Insomniac CEO Ted Price told employees in an email last month.
In a separate response to employees, Price said there would be “material repercussions for us as a wholly owned subsidiary” if Insomniac or its employees tweeted support for abortion rights or disclosed a $50,000 donation Sony permitted the studio to make to the Women’s Reproductive Rights Assistance Project. “Among other things, any progress that we might make in helping change [Sony Interactive Entertainment’s] approach would be stopped dead in its tracks. We’d also probably be severely restricted from doing important public-facing work in the future,” Price wrote at the time.
Now, Insomniac is speaking up. “We are human beings who make games,” the studio wrote in a tweeted image. “Reproductive freedom and bodily autonomy are human rights.”
Yelp is closing its New York, Chicago and Washington, D.C., offices as the company embraces remote work.
In a Thursday blog post, Yelp CEO Jeremy Stoppelman said employees were barely using those three offices. Yelp is also trimming its real estate footprint in Phoenix, he said.
“The most telling signal for us that people strongly prefer remote work has been the under-utilization of our offices,” Stoppelman wrote.
Only 1% of Yelp’s global employee base goes to the office every day, Stoppelman said, and employees were using less than 2% of the available workspaces in New York, Chicago and D.C. Those three offices will close July 29, he said.
Stoppelman has previously been a vocal advocate for remote work, going toe-to-toe with Founders Fund partner Keith Rabois last month when Rabois tweeted that he wanted to fund “IRL startups.”
Stoppelman tweeted that wanting to fund in-office startups was “equivalent to ‘looking to fund startups running Windows95,’” encouraging Rabois to “live in the future and fully embrace remote.”
Yelp downsized its San Francisco headquarters to three floors of a building in September of 2021. Before the pandemic Yelp was squeezed by the tech giants for both real estate and talent in San Francisco, although the picture looks very different now.
In the blog post, Stoppelman insisted that remote-first was best for Yelp and that even a hybrid model is a mistake when it requires employees to show up at the office regularly.
“It requires employees to live near an office, potentially driving up their housing costs, and to endure unpaid time spent commuting,” Stoppelman said. “It also means hiring is artificially constrained by geography, translating to a smaller and less diverse pool of talent.”
Yelp’s workforce is now distributed across every U.S. state and four countries, Stoppelman said, and has two remote C-level executives who don’t live near a Yelp office. The company has seen a “strong surge” in interest from job applicants, many of whom cited remote work as part of their interest in working at Yelp, he said.
