Tech Brew Ride Home - Wed. 09/08 – Coinbase Tussles With The SEC?

Episode Date: September 8, 2021

Coinbase says the SEC threatened to sue it over a crypto lending product. The fallout from yesterday’s Bitcoin launch in El Salvador. Ford hires away one of the key executives on the Apple Car project. Microsoft and PayPal make some interesting acquisitions. And hey. Some new laptops! Sponsors: Otter.ai code: RIDE to test drive for free Grammarly.com/techmeme Links: Brian Armstrong responds to SEC threats to shut down Coinbase yield product (The Block) El Salvador Buys Its First 200 BTC a Day Before Its Bitcoin Law Becomes Effective (Coindesk) Ford poaches top tech executive Doug Field who helped lead Apple’s top-secret car project (CNBC) Apple Event Announced: 'California Streaming' on September 14 With iPhone 13, Apple Watch Series 7 Expected (Macrumors) Microsoft acquires video-editing software start-up Clipchamp (CNBC) PayPal Closes $2.7B Acquisition Deal For Japan’s Paidy (Pymnts.com) Amazon brings its cashierless tech to two Whole Foods stores (CNBC) Lenovo's new Windows 11 laptops could reinvent the IdeaPad brand — and take on the MacBook (Laptopmag.com) Learn more about your ad choices. Visit megaphone.fm/adchoices

On April 4th, 2023, around 2 in the morning, a man was found stabbed multiple times on a sidewalk in downtown San Francisco. Hey, who did this to you? What happened next turned the story into a political firestorm. Reports have identified the victim as Bob Lee, the founder of Cash App. From Bloomberg Podcasts, this is Foundering, the Killing of Bob Lee, beginning April 16. Welcome to the tech meme right home for Wednesday, September 8th, 2021. I'm Brian McCullough. Today, Coinbase says the SEC threatened to sue it over a crypto lending product, the fallout from yesterday's Bitcoin launch in El Salvador. Ford hires away one of the key executives from the Apple Car Project. Microsoft and PayPal makes some interesting acquisitions.

And hey, some new laptops. Here's what you miss today in the world of tech. Coinbase CEO Brian Armstrong last night said that the SEC threatened to sue Coinbase, over its yet to be launched LEND program, even though some discussions about the product had been ongoing with the SEC for almost six months, quoting the block. The firm, which went public on the NASDAQ stock exchange in April, received a subpoena by the SEC less than three months after it announced to the market a product dubbed Lend that would allow users the opportunity to earn yields on deposits of USDC, the stable coin on its platform. That's a much juicier yield than what is offered by consumer banks, which provide less than a basis point for savings accounts. Armstrong said that the exchange

contacted the SEC about its yield product, and the SEC told Coinbase that the offering is a security, but gave no guidance on the compliance with existing laws. In a tweet, Armstrong added, quote, they refused to tell us why they think it's a security and instead subpoena a bunch of records from us. We comply. Demand testimony from our employees. We comply. And then tell us they will be suing us if we proceed to launch with zero explanation as to why. And, quote, quote. According to Armstrong, the SEC, quote, refused to meet with the chief executive during a visit to D.C. earlier this year, quote, the SEC was the only regulator that refused to meet with me, saying, we're not meeting with any crypto companies, Armstrong wrote. This was right after we became

the first crypto company to go public in the U.S., end quote. In a blog post, the firm's chief legal officer, Paul Gruhl said that Coinbase has, quote, been proactively engaging with the SEC about lend for nearly six months, end quote. He said that if the product officially launched, the SEC would sue. Despite Coinbase keeping lend off the market and providing detailed information, the SEC still won't explain why they see a problem. Rather, they have now told us that if we launch lend, they intend to sue. Yet again, we asked if the SEC would share their reasoning with us, and yet again,

they refused, end quote. BlockFi, a crypto financial services provider, has also been under fire for a similar product, which offers users a high yield when they park stable coins with the company. Five states have said that the firm has violated. securities regulations and laws, end quote. By the by, yesterday was the day that Bitcoin became the official currency of the nation of El Salvador, and things didn't go well. Right around 10, 11 a.m. Eastern yesterday Bitcoin suddenly plunged from above $50,000 a coin,

down more than 17 percent to around $53,000 a coin before raising to $47,000, as high demand in El Salvador led to the Chivo wallet, which citizens in El Salvador, Salvador were supposed to use going forward, being temporarily unplugged. To get a sense of why this was not ideal, think of this. Salvadorians were told that this morning they were all going to get $30 worth of Bitcoin in their wallets. But when and if they actually got that Bitcoin, it was only worth about $25, quoting Coin Desk. El Salvador president, Naib Buceli announced on Twitter his government bought 200 Bitcoin on

Monday, a day before the country's Bitcoin law, which will make the cryptocurrency legal tender within the Central American nation goes into effect. Quote, El Salvador has just bought its first 200 coins, he wrote. Our brokers will be buying a lot more as the deadline approaches. Hashtag Bitcoin Day, hashtag BTC. On Monday, at 1515 UTC, Buckelly tweeted that El Salvador had purchased 150 additional bitcoins following its recent price drop, bringing its total holdings to 550 BTC, end quote. Yeah, buying the dip. Unfortunately for Bkelly, he was, actually doing the classic thing of trying to catch a falling knife, as the saying goes on Wall Street. Bitcoin's price has stabilized somewhat currently around the $46,000 mark. But, you know,

having your currency fluctuate in value 17% in an hour, let's just say that's not ideal in the world of sovereign currencies. Such things under normal circumstances tend to cause bank runs, financial panics, governments to fall, etc. As ever, no matter how much I try to to stay on top of this story. I can't make heads or tails of it. Is Apple making a car? Is it having success making the car? Is it having trouble? Is it abandoning or downsizing the ambitions of its car project? seemingly every six months or so, we get conflicting headlines and rumors and narratives. So chuck this into the pile as well. Ford has announced it has hired former Tesla and Apple executive Doug Field as its chief advanced technology and embedded systems officer. So that would

seemingly be bearish news for an Apple car, right? Field was a big name, supposedly a big force on the Apple Car Project, quoting CNBC. Field, who led development of Tesla's Model 3, most recently served as vice president of special projects at Apple, which reportedly included the tech giant's Titan car project. The hire is a major addition for Ford and a big hit to Apple and its secret car project, which the company has yet to confirm exists. I think anytime you lose a well-respected experience, executive who, as best as we can tell, was really directing the automotive efforts at Apple. It's a blow to any company, Bernstein analyst Tony Sakanagi, who covers the iPhone maker, told CNBC's closing bell. Apple, in an emailed statement, said, quote,

we're grateful for the contributions Doug has made to Apple, and we wish him all the best in this next chapter, end quote. In 2016, Apple reportedly abandoned plans to build its own car, focusing more on developing the software for autonomous driving. Fields' most recent Stint at Apple was seen by industry insiders as an indication that the company was again looking at building its own vehicles. His most recent stint at Apple was seen by some industry insiders as a re-emphasis on vehicle design after the company refocused its efforts on autonomous driving software. Field declined to discuss his work at Apple, but he said there's, quote, nothing that prevents me from being fully engaged at Ford, end quote, when asked if his former

employer made him sign a non-disclosure agreement, end quote. Now, at the same time, we've also heard that John Gian-Andrea was fully taking the reins of the car project at Apple. So maybe this is just the usual jostling for position among executives on a major project. There can only be so many people in charge, so many chefs in the kitchen. Maybe there's nothing to see here, but I will tell you one thing. Somebody's going to write a book someday about the whole self-driving car effort and industry, you know, Waymo, Tesla, Uber, all of it. And I'm going to tell you right now, I'm going to read the hell out of that book when it finally shows up. By the way, mark your calendars because Apple sent out invites to

a California streaming. That's their term for it, virtual event to be held on September 14th, at 10 a.m. Pacific time, 1 p.m. Eastern, where new iPhones and Apple watches are expected to be unveiled. But you know, new iPhones are cool and everything, but what I'll literally bite your handoff for is the resurrection of a usable MacBook Pro with Apple Silicon inside, quoting Mac rumors. New MacBook Pro models and new iPads are also on the horizon, but Apple is expected to hold multiple fall events this year, so we're not likely to see everything come out in September. Apple's iPhone 13 models will be similar to the iPhone 12 models with few design changes. Apple is planning to release a 5.4-inch iPhone 13 Mini, a 6.1-inch iPhone 13, a 6.1-inch iPhone 13 Pro,

and a 6.7-inch iPhone 13 Pro Max. The general design will be the same, but we are expecting a smaller notch. There will also be some improvements to the cameras with Apple bringing sensor shift optical image stabilization to the whole iPhone 13 lineup, introducing a better ultra-wide camera for the pro models and improving the cameras of the iPhone 13 Pro to bring it in line with the Pro Max. A faster A15 chip is coming, along with faster 5G technology, and perhaps the biggest change might be the 120-hertz Pro Motion display expected for the Pro Models. There have also been rumors of an always-on display, so that's a possibility, as are larger

batteries and more maximum storage space, end quote. A couple of interesting acquisitions for you. First, Microsoft says it has acquired in-browser video editing software startup Clipchamp, which has 17 million registered users across more than 390,000 companies as of July, quoting CNBC. While Clipchamp offers a Windows app, part of the service's power, is its ability to draw on online computing resources. Clipchamp's technical approach is to combine the simplicity,

of a web app with the ability to process video using the full computing power of a PC with graphics processing unit acceleration, something that was formerly limited to traditional video applications. Chris Pratley, corporate vice president for the Office Media Group at Microsoft wrote in a blog post. The Clipchamp services are not yet available through a Microsoft licensing program, a Microsoft spokesperson told CNBC in an email, quote, as we get further through the integration planning, we will have a process to eventually convert existing Clipchamp users slash customers to Microsoft subscribers, the spokesperson said. Clipchamp was founded in 2013, is based in Brisbane, Australia, and has 92 employees, according to LinkedIn data. Investors

include 1013 and Tola Capital. In July, Clipchamp said it had 17 million registered users with adoption at over 390,000 companies up 54% year over year. The Clipchamp website says Deloitte, Google, Microsoft, and Zendesk are among the companies that use its software. The startup reported 140% growth in exports in the 9x15 aspect ratio, which works with Facebook's Instagram stories and TikTok. People also used Clipchamp for screen recording and webcam recording, end quote. So, a social media creator tools play that also might play well with their cloud computing efforts. Interesting. And here's the other one. PayPal has acquired Japan-based Pady, a buy-now pay-later service for $2.7 billion in cash. PayPal expects the deal to be completed by

December, and yes, this is obviously more sign of extreme activity in the buy-now pay-later space. Quoting Payments.com. Founded in 2008, Pady has more than 6 million registered users and has relationships with some of the biggest brands worldwide. The company has rolled out numerous products, including its three-pay monthly installment plan, and seamlessly integrates with PayPal and other QR. wallets. There is no better home for Pady to continue to grow and innovate than PayPal, which has been removing friction from online shopping for more than 20 years, said Russell Coomer, founder and executive chairman of Pady. Japan has been a vibrant environment for our growth to date, and we're honored to have our team's hard work and potential recognized by a global leader.

Together with PayPal, we will be able to further achieve our mission of taking the hassle out of shopping, Coomer said, and quote, Amazon says it is bringing its cashier list. just-walk-out technology to two Whole Foods stores set to open in 2022, quoting CNBC. One store will be located in the Glover Park neighborhood of Washington, D.C., and the other in Sherman Oaks, California. Amazon's Just Walkout technology allows shoppers to enter a store by scanning an app and exit without needing to stand in a checkout line. Cameras and sensors track what items shoppers select and charge them when they leave. At the upcoming Whole Foods locations, shoppers who want to skip the checkout line

enter the store by either scanning an app, inserting a credit or debit card link to their Amazon account, or placing their palm over the company's palm scanning payment system called Amazon Amazon. Shoppers who opt out of using Amazon's cashier list technology will only be able to ring up their items using self-checkout or at a customer service booth. Amazon has deployed its cashierless technology across a growing number of store formats, including at several fresh grocery stores and in its Go-Convenience stores. It also sells the technology to third-party retailers. Amazon launching the technology in fresh and Whole Foods locations puts it ahead of startups that have developed similar systems but have largely struggled to roll them out to bigger stores

due to the technical challenges, end quote. Let's end today with some interesting new gadgets, since we haven't had that, I feel like, in a little while. Lenovo has unveiled the 14-inch IdeaPad Slim 7 Carbon and 16-inch Slim 7 Pro laptops, powered by AMD, both expected by October and priced from, $1,290 bucks, quoting Laptop mag. IdeaPad laptops have long been overshadowed by think pads and yogas, but today, Lenovo took a step toward changing the perception of this oft-overlooked series by launching the IdeaPad

Slim 7 Carbon and Idea Slim Pro. You may associate IdeaPad with mid-range consumer PCs, but this new pair of ultra-portable laptops are firmly in the premium segment. In fact, these idea pads are, as much as any yoga we've reviewed, direct competitors to del XPS and HP Specter models. It starts with some eyebrow-raising display options, including a 14-inch 2880 by 1,800 pixel, QHD Plus OLED panel on the Slim 7 Carbon, and a 16-inch 2.5K screen with an optional 120-hertz refresh rate on the Slim 7 Pro. Both models are powered by up to an AMD Ryzen 7 CPU and outfitted with discrete graphics and up to 1 terabytes of storage. Lenovo is clearly using the release of Windows 11 as a launchpad to reinvent the IdeaPad name

with two compelling new ultra-thin yet powerful notebooks. Can the IdeaPad Slim 7 Carbon and IdeaPad Slim 7 Pro convince buyers to look away from other established brands in this segment and join our list of the best laptops? The IdeaPad Slim 7 Carbon and Slim 7 Pro are scheduled to arrive in October. Lenovo didn't specify a date, but we expect them to ship at or shortly after the release of Windows 11 on October 5th. As mentioned, these are premium laptops, despite falling under Lenovo's historically mid-range ideopathad moniker, the Ideapad Slim 7 carbon will start at $1,1289, while the IdeaPad Slim 7 Pro will cost $1,49, end quote. All right, I need to catch you up on the World Cup of Entrepreneurs voting.

Hashtag World Cup of Entrepreneurs. Over the weekend, Elon Musk advanced, Bill Gates advanced, Larry and Sergey advanced, and Steve Jobs trounced Mark Bennyoff overnight, and I think the biggest blowout we've seen yet. The closest vote that we've seen yet was when Patrick Collison overcame Oprah literally by one vote. So the round of 16 is over, and today we begin the quarterfinals. First up with the matchup is Jeff Bezos going up against Reed Hastings of Netflix. Voting is live, so get to it. Who is more influential? The man who changed how we shop, or the man who changed how we watch TV and Talk to you tomorrow.