Tech Brew Ride Home - Wed. 12/23 – XRP, The 3rd Biggest Cryptocurrency Might Be In Big Trouble

Episode Date: December 23, 2020

The SEC does indeed sue Ripple, and that could be a bigger deal than I thought. Twitter won’t hand over the @Potus Twitter followers to Biden. What Zoom wants to do for its next act beyond video. Controlling your AirPods with your teeth. And, special for this week, a Long Holiday Weekend edition of the Longreads Suggestions. Sponsors: Hawthorne.co, promocode: techmeme Tovala.com/ride Links: SEC Sues Ripple Over 7-Year, $1.3B ‘Ongoing’ XRP Sale (CoinDesk) Biden @POTUS Account Reset to Zero With Trump Followers Out (Bloomberg) Telegram, nearing 500 million users, to begin monetizing the app (TechCrunch) Buoyed by Video Success, Zoom Explores Email, Calendar Services (The Information) Apple Patent reveals new Through-Body' input for AirPods allowing users to control functionality by touching their face, clicking their teeth & more (Patently Apple) Weekend Longreads Suggestions: Our Digital Lives Drive a Brick-and-Mortar Boom in Data Centers (NYTimes) The North Carolina Kid Who Cracked YouTube’s Secret Code (Bloomberg) What if life were a video game? These 650,000 people imagine it that way. (The Washington Post) Czech Startup Founders Turn Billionaires Without VC Help (Bloomberg) Inside the Whale: An Interview with an Anonymous Amazonian (Logic Magazine) Star Wars toys keep changing, and leaving kids behind (Polygon) Shigeru Miyamoto Wants to Create a Kinder World (The New Yorker) 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, December 23, 2020. I'm Brian McCullough today. The SEC does indeed sue Ripple, and that could be a bigger deal than I thought. Twitter isn't handing over the existing at-POTUS Twitter followers to President-elect Biden, what Zoom wants to do for its next act beyond video, controlling your AirPods with your teeth, and special for this week, a long holiday weekend edition of the Long Read Suggestions. Here's what you missed today. in the world of tech. The SEC has indeed gone ahead and sued Ripple Labs, its CEO Brad Garlinghouse and chairman Chris Larson, alleging that they violated federal securities laws by selling

XRP to retail customers. This is actually a bigger deal than I thought, because it might actually lead to the delisting of XRP from major cryptocurrency exchanges. The price of XRP is down over 30% at the time of this writing, quoting Coin Desk. According to a lawsuit filed Tuesday, Ripple raised $1.3 billion over a seven-year period to retail investors through its sale of XRP on an ongoing basis. Ripple CEO Brad Garlinghouse announced Monday that the SEC had told his company of the impending lawsuit and published the payment firm's Wells Response, a document that seeks to tell the SEC why certain activity did not violate U.S. securities laws. The San Francisco-based fintech firm has long maintained that XRP, the cryptocurrency, is separate from Ripple the company.

The cryptocurrency was often referred to as Ripple through early 2018 and shared a logo with the company until later that year. The impact could be wide-ranging. Several exchanges list XRP in the U.S. with only one deciding to delist the cryptocurrency ahead of the Tuesday lawsuit. If the SEC prevails platforms that continue to list the crypto may have to register as securities exchanges. According to the complaint, which names CEO Brad Garlinghouse and Chairman Chris Larson, in addition to Ripple Labs as defendants, Ripple violated Sections 5A and 5C of the Securities Act of 1933 by failing to register XRP as a security or seeking an exemption.

Quote, over a years-long unregistered offering of securities, Ripple was able to raise at least $1.38 billion by selling XRP without providing the type of financial and managerial information typically provided in registration statements and subsequent periodic and current filings. The filing said, quote, Ripple used this money to fund its operations without disclosing how it was doing so or the full extent of its payments to others to assist in its efforts to develop the use for XRP and maintain XRP secondary trading markets, end quote. So it turns out that there actually is precedent for the SEC sort of inflicting mortal investigations on a cryptocurrency and not good precedent if your ripple. Remember, XRP was the third largest cryptocurrency

by Market Cap, quoting Fiona Kobayashi on Twitter. Those of you saying the SEC's suit on ripple will not affect XRP. Have a look at the SEC's 2019 suit on kick and its effect on the kin token in the lead up to the filing and over the ensuing one and a half years. As noted by Catherine Wu, it's the same play in terms of process and ugly. end quote. The transition team for President-elect Joe Biden says Twitter has told them that the current followers of the at POTUS, president of the United States account, will not carry over when the Biden administration is handed the keys to the account. Followers will start back at zero, which is a reversal for how Twitter handled things back in 2017 the last time there was a presidential

transition, quoting Bloomberg. If the accounts are reset to zero, that would be a change from when Trump took office. On inauguration day, 2017, each had more than 13 million followers at 12.1 p.m. that day when Trump was sworn in, the At Potus account was changed to At Potus 44 in archive of Barack Obama's official tweets as America's 44th president. Followers of that account were also automatically added as followers to the newly created POTUS account for the Trump administration. Twitter said that users who follow the current White House accounts will be notified that they are being archived with 45 added to the handles and will be given the option to follow the Biden administration accounts. The Biden team says the new plan is for at transition 46 to become at White House.

Followers of at Joe Biden and at White House will be encouraged to follow the new account with a one-time front page notification but will not be migrated over automatically. The Twitter accounts of the First Lady at Flotus and of the White House Press Secretary at PressSec, which have millions of followers each, will also be reset to zero, end quote. Telegram is debuting group voice chat, while at the same time CEO Pavel Durov announced that Telegram is nearing 500 million monthly active users. To serve this audience, Telegram is going to start monetizing, finally, with a soon-to-be-launched ad platform next year, quoting TechCrunch. The new voice chats feature, which is similar to

Discord's Always On Room, supports a few thousand participants. The service which topped 400 million active users in April this year will introduce its own ad platform for public one to many channels, one that is user-friendly, respects privacy, and allows us to cover the cost of servers and traffic. Duraov wrote on his telegram channel, all existing features will remain free, said Dura, who is one of the biggest critics of Facebook-owned WhatsApp, adding that Telegram is committed to not introduce ads in private one-to-one chats or group chats because they are, quote, a bad idea. We are not going to sell the company like the founders of WhatsApp. The world needs Telegram to stay independent as a place where users are respected and high-quality

service is insured, he wrote. Telegram will begin to generate revenue starting next year. We will do it in accordance with our values and the pledges we have made over the last seven years, Thanks to our current scale, we will be able to do it in a non-intrusive way. Most users will hardly notice any change, end quote. It's been a hell of a year for Zoom. I mean, it's been a hell of a year for all of us. But a year ago this time, Zoom was, you know, just a newly public company that, you know,

we tech nerds were aware of because it was becoming the de facto way to conduct remote meetings. And then a bunch of stuff happened, which you might be aware of, And Zoom ended up the de facto way to conduct most of daily life in the year 2020. So a question a lot of people have been asking is, what is next for Zoom? Sure, the company is killing it with revenue growth and their stock has been on a tear, but what comes beyond video? Could Zoom leverage their amazing success this year and their stranglehold on business interactions this year to become more of a productivity platform?

Could Zoom have longer legs? Well, sources are telling the information that Zoom has begun developing a web email service for businesses that they intend to trial next year and is also considering building a calendar app. After an extended period of surging sales growth, the possibility that COVID-19 vaccines will allow workers to return to offices sometime next year, potentially becoming less reliant on video conferencing, has increased the urgency inside Zoom to map out the company's next act. Zoom's shares have risen 500% since the beginning of the year, but are trading well. below their October peak. According to people familiar with his thinking, Zoom CEO Eric Yuan envisions broadening the company's video conferencing service into a full-fledged platform that would include email, messaging, and other productivity tools. Yuan's goal is to figure out what the next generation of email will look like rather than mimic existing products, one of the people

said. The projects are still in the early stages, and it is possible Zoom will decide not to move forward on them. Yuan's aim to build email and calendar services is part of a strategy to compete with Microsoft and Google for large corporate customers, the people said. While Zoom has integrated its video service with email and calendar offerings from other providers, senior Zoom executives have discussed how having a broader collection of apps would help the company cast a wider net for business users. Targeting those customers also heightens the importance of developing a calendar app, since email and calendars are often used in tandem, said one of the people. The company already has sought to broaden the utility of its platform by launching integrations

that allow users to easily access popular software tools such as Asana, Dropbox, and Coursera from within Zoom. The integrations are a clear sign that Zoom wants to expand its identity beyond video conferencing, said Raoul Caston Martinez, a senior research analyst at 451 research, part of S&P Global Market Intelligence. That tells you they are definitely looking into expanding into productivity, he said. Zoom says they are doing this through third parties, but it could make sense if they look to expand this with their own technology, end quote. As Martin Bryant tweeted, quote, business email is incredibly hard to break into with a differentiated product that enough people will switch to. But hey, that's what they said about video conferencing, end quote.

A new Apple patent suggests Apple might be considering so-called throughbody input for upcoming AirPods, a feature that would allow users to control functionality by doing things like touching their faces, moving their hands, even clicking their teeth, quoting patently Apple. Input actions may further include a user moving a body part, such as moving or shaking his or her head, moving his or her hands, arms, legs, and so on. Input actions are not intended to be limited to the user interacting with his or her own body either. For example, input actions may include a user contacting or otherwise interacting with another object, such as an inanimate object or another person.

Apple's patent depicts a wearable audio device positioned in the ear of a user. The wearable audio device includes functionality for detecting input actions. In some embodiments, the user may perform an input action by contracting a body part of the user. For example, as shown in Figure 5, the user may contact the user's head or face using the user's finger. The input device of the wearable audio device may detect signals that correspond to the input action, end quote. So you can click through to actually look at the patent. And though it's not mentioned in the filing, when I was reading it, I was thinking, might this also be something Apple's new LiDAR sensors would be useful for?

As I'll explain at the end of the show, I'm going to take the next couple of days off. So this is your last episode of the week, which means it is time for the weekend long read suggestions. Holiday weekend edition, TM. First up, the New York Times says demand for data centers has been a rare bright spot in U.S. commercial real estate this year. Not only are new data centers being built all across the land, but you know how self-storage places often rehab and repurpose huge old factories and buildings like that. That's apparently going on as well, quote, real estate investment trust focused on data centers delivered returns of 19% in the first half of 2020.

of only two reet sectors that showed growth, according to a recent report by JLL. The other sector, industrials, yielded a modest 2% return. By comparison, returns for hotel and resort reits plunged 49%. Those for retail fell 37% and office space dropped 25%. It's an acknowledgement that this is not a niche real estate market anymore, Mr. Lynch said. Data centers have emerged as a critical part of the digital infrastructure that connects people and businesses to one another and the rest of the world, said John Lynn, president for the America's region at Equinix, one of the largest global data center companies, end quote. Next, say hello to Jimmy Donaldson, aka Mr. Beast, the top creator on YouTube this year.

He's 22 years old. He's got more than 48 million subscribers. He gets around 4 billion views per year, has around 50 employees. To create his video spends roughly $300,000 per video. Oh, and he's launched a burger delivery business for his fans, quote. The consistent success of Mr. Beast's videos has gotten the attention of the YouTube establishment. Last year, every video he posted eclipsed 20 million views. Such consistency is unparalleled even among YouTube's biggest stars.

He lives on a different planet than the rest of the YouTube world, said Casey Nicestat, a filmmaker-turned-unner-turned-y-todont. Donaldson, now 22, has a baby face and a patchy goatee. He speaks with an aw shucks modesty and doesn't do many interviews, but the restraint quickly fades away when he starts talking about YouTube. Quote, once you know how to make a video go viral, it's just about how to get as many out as possible, he said. You can practically make unlimited money, end quote. Then are you familiar with the subreddit R slash outside?

That's where, quoting the Washington Post, about 650,000 users imagine our reality as a free-to-play MM-O-R-P-G with 7 billion-plus active users, as stated in its bio. Users post questions or stories about life as if they're discussing a video game such as World of Warcraft. Though the subreddit has been around since 2009, 100,000 of those users joined in 2020. What better year, after all, to point out life's absurdities through the lens of a video game. Prepare to update your games because 2021 V-1 is dropping only weeks from now, hoping it patches the COVID-Bud. Stated one recent post. Most of the posts still focus on the every day from the serious to the silly.

One post which points out how few calories celery contains, deemed the vegetable, quote, the most broken food item in game, end quote. Quote, I unlocked the first name basis with the pizzeria owner, achievement, boasted one user, even added bonus garlic knots to my inventory, end quote. Then are you aware of the open source Kotlin programming language? In 2019, Google announced that Kotlin was the preferred language for Android development. But did you know, there's also a startup behind Kotlin. It's the Polish company JetBrains.

And JetBrains is doing $200 million a year in profits, not revenue profits. While their company is valued at roughly $7 billion, and guess what, they're entirely bootstrapped. They've never taken any VC money, quote, the firm which boasts it is among the biggest employers of programmers in St. Petersburg isn't interested in raising capital amid high demand for technology companies, according to chief executive officer Maxime Schafferov. Quote, venture capitalists write every other day, and I feel like a very impolite, unkind person because I've stopped answering, Schafferov said in an interview, quote, we've got enough resources to realize our ambitions, end quote.

From logicmag.io, there's an interview with an anonymous AWS security engineer, which I haven't read yet, but purports to explain why AWS is so easy to migrate to, but so difficult to leave, how the pandemic has compounded AWS's advantages and apparently a ton more. So devs check that out. And there's a timely seasonal piece from Polygon about how these days a lot of the biggest toys are designed for collectors, meaning that the joy and wonder of, you know, kids actually playing with toys is increasingly left out of the equation, quote, some of the shift is pure economics. Star Wars products like toy lightsabers still do well at all levels, but younger audiences aren't, quote, necessarily gravitating toward action figures.

Paulus notes, baby Yoda, aka Grogu, aka The Child, for example, is a tiny action figure, but easy to manufacture as a life-size plush or animatronic, and it's topped plenty of Hot Toys of 2020 lists in that form. But the homogeneity of Star Wars products isn't limited to toys. More types of Star Wars products are available than ever, but they seem to draw from the same limited familiar iconography. The Mandalorian and the child have made it into a small elite group of characters allowed to make constant appearances on clothing, posters, and cell phone cases. That group also includes Boba Fett, Darth Vader, original recipe Yoda, the droids, a few classic human characters like Luke Han and Leah and the ubiquitous all-purpose stormtrooper.

Countless Star Wars products are basically just images of the same old helmets, end quote. But finally, a man who is only joy and wonder and play. The New Yorker of all places has a rare interview with Shigero Miyamoto, the inventor of Mario and Zelda, the absolute legend of Nintendo. His games have sold hundreds of millions of copies. He's played a major role in designing the Wii. He's as much Nintendo's mascot as the characters he's created. Rumors that he might retire have had an immediate effect on the company's stock price. Miyamoto turned 68 in November. He's been linked to Walt Disney since the early days of his career, and those comparisons are set to continue.

Miyamoto is currently overseeing the design and installation of Super Nintendo World, a half-billion-dollar theme park at Universal Studios in Osaka. because of his mystique Nintendo tends to keep Miyamoto away from the media. As Nick Parmigarton wrote in his profile from 2010, securing an audience is a little like trying to rescue Princess Toadstool. But a few days after Miyamoto's birthday, I had a rare chance to speak to him at length over Zoom, and he was willing to show more of the man behind the mascot than expected. In doing so, he revealed how deeply he has considered the discipline of game design

and how much he has tried to move it forward, end quote. So, yes, as hinted at, I'm going to take the next two days off. There's not going to be that much news anyway. And also, I've got a four-year-old and a six-year-old. So these are the prime Christmas years for our family. Have a lot of things to do to prepare for Santa. The next episode will be on Monday. Happy holidays for those who celebrate.

Talk to you all next week.