Elon Musk has dealt two blows to cryptocurrencies in the past few days, first describing dogecoin as a “hustle” and then deciding Tesla would no longer accept bitcoin as payment for its electric cars.
Dogecoin has fallen from around 70 cents to 40 cents since his comments on the Saturday Night Live show, while bitcoin is down more than 10 per cent today following his tweet that Tesla was suspending vehicle purchases using bitcoin because of its concerns about “rapidly increasing use of fossil fuels for bitcoin mining and transactions, especially coal”. The environment has been the victim of bitcoin’s success in recent months, with Musk later tweeting “Energy usage trend over past few months is insane”, along with the chart below.
As Richard Waters reports, the Tesla chief executive’s enthusiasm for the energy-hungry currency ran counter to the climate change concerns that he has always said led to his involvement in electric cars.
The FT View is that Musk’s primetime television spot shows crypto assets have reached the mainstream and are therefore in line for greater regulation. The global and unfettered nature of the crypto exchanges means international co-ordination is needed. Achieving this will be difficult given the different approaches: China is draconian, offshore centres such as Gibraltar are welcoming, and the US, UK and Europe sit in between.
Gillian Tett argues the fight over green standards might start a process of greater accountability, by providing a cause for young crypto-enthusiasts to rally around.
Meanwhile, Facebook appears to be abandoning its global ambitions for its Diem digital currency project. The initiative, formerly known as Libra, had come under pressure from regulators around the world and founding members including PayPal and Mastercard had quit.
Hannah Murphy reports it has dropped its application to the Swiss Financial Market Supervisory Authority to operate as a payments service, and will instead apply to register as a money services business with the US Treasury. It will shift its operations to the US and partner with a domestic bank to issue a US-dollar backed stablecoin.
1. Alibaba and Coupang report maiden lossesChinese ecommerce group Alibaba swung to its first quarterly loss since its US listing six years ago after a record $2.8bn fine levied by Beijing authorities was taken into account. It reported a net loss of Rmb5.5bn ($836m) for its latest quarter, despite a 64 per cent rise in revenues. South Korea’s Coupang, the recently listed ecommerce group backed by SoftBank, reported its first-quarter net loss jumped 180 per cent year on year to $295m, despite revenues rising 74 per cent to $4.2bn.
2. Biden orders tighter cyber securityThe US president has signed an executive order where federal agencies will be required to introduce multi-factor authentication to their systems and encrypt all data within six months. This follows the SolarWinds and Colonial hacks originating from Russia. The Colonial pipeline resumed operations on Wednesday, allowing petroleum supplies to begin reaching eastern US states five days after the ransomware attack.
3. Airbnb algo led to increased racial disparitiesLow uptake of an optional pricing algorithm on Airbnb by black hosts had the effect of widening racial disparities in earnings on the platform, a new study has found. The optional “Smart Pricing” feature, which dynamically adjusts the cost of a night’s stay based on current demand, was meant to help users secure more bookings.
4. Tech stock volatility continuesA comeback by tech shares today is petering out in another sign of the current volatility. Richard Waters looks in his Inside Business column at how this has been affecting companies new to the market like Palantir.
5. BT expands full-fibre horizonsBT has opened the door to external investors funding an expansion of its fibre network for the first time, after the UK telecoms group said it would increase its fibre broadband build to 25m homes by 2026, up from a previous target of 20m.
The UK chancellor of the exchequer Rishi Sunak this week hailed a new “age of entrepreneurship” in Britain, adding he wants to inject a similar spirit of fast-moving innovation into a “start-up Treasury.” Speaking exclusively to Sifted, Sunak said the government would support entrepreneurs’ efforts to expand their start-ups and create jobs by reviewing research and development credits as well as options schemes and visa rules.
In other news, Revolut, the $5.5bn London-based fintech, confirmed that it has appointed 29-year-old Yale graduate Mikko Salovaara as its chief financial officer after a year-long search to fill the role. The appointment of someone so young goes against the grain of the fintech’s recent strategy of hiring older and more experienced people into senior positions, which comes amid attempts to win a UK banking licence. Finance veterans such as Michael Sherwood and Ian Wilson have joined the Revolut board in the past year.
Elsewhere in European start-ups this week, QphoX, a Delft University spinout, has created a “quantum modem” that can get quantum computers to link up and perform more powerful (and useful) functions. The idea is that it is the start of the “quantum internet”. Sifted also looked at which venture capital firms have the most $1bn fintechs in their portfolios; who were the most active start-up “angel” investors in Germany and dove into a fast-growing payments company called Saltpay.
Imagine a clutter-free future where cables and boxes disappear and all your essential tech is hidden away in your ceiling.
That’s the vision of Zuma, a British company that launched with its first product today — an LED light fitting that contains a powerful 75W speaker. I visited its pop-up store in central London and was impressed with the sound coming from an array of wireless spotlights overhead in a mocked-up living room. The plan is to provide different fascia options with more tech embedded in them, such as security cameras, smoke alarms and motion sensors.
In my own home, Zuma could replace my Philips Hue lighting, Sonos sound system and various security cameras. The drawbacks would be the spotlights do not have a full-spectrum colour option initially, only degrees of white, the speakers have plenty of bass in them but I would still miss a ground-based subwoofer, and the security option has yet to be implemented.
Costs may also put off individual consumers at £375 per unit, but I can imagine these being installed in hotels, dental surgeries and luxury property developments. An accompanying app allows you to control both lights and music choices, the system is Alexa-enabled and installation of the wirelessly connected units appears as simple as for any spotlight.