Kraken Settles With SEC For $30 Million, Agrees To Shutter Crypto-Staking Operation

According to CoinDesk, Kraken has agreed to shut its cryptocurrency-staking operations to settle charges with the U.S. Securities and Exchange Commission (SEC). From the report: The SEC will discuss and vote on the settlement during a closed-door commissioner meeting on Thursday afternoon, and an announcement may come later in the day, the industry person told CoinDesk. Kraken offers a number of services under its staking umbrella, including a crypto-lending product offering up to 24% yield. This is also expected to shut down under the settlement, the industry person said. Kraken’s staking service offered a 20% APY, promising to send customers staking rewards twice per week, according to its website. Bloomberg reported that Kraken was close to a settlement with the SEC over offering unregistered securities on Wednesday.

SEC Chair Gary Gensler has previously said he believes staking through intermediaries — like Kraken — may meet the requirements of the Howey Test, a decades-old U.S. Supreme Court case commonly used as one measure of whether something can be defined as a security under U.S. laws. Staking looks similar to lending, Gensler said at the time. The SEC has brought and settled charges with lending companies before, such as now-bankrupt lender BlockFi. A Kraken settlement would help Gensler’s mission, giving his agency a big win as it continues its efforts to police the broader crypto ecosystem. The majority of people staking on Ethereum, for example, use services, according to Dune Analytics. CNBC reports that the crypto exchange has also agreed to “pay a $30 million fine to settle an enforcement action alleging it sold unregistered securities.”

“The SEC claims Kraken failed to register the offer and sale of its crypto staking-as-a-service program. U.S. investors had crypto assets worth over $2.7 billion on Kraken’s platform, the SEC alleged, earning Kraken around $147 million in revenue, according to the SEC complaint (PDF).” The SEC announced the charges in a press release.

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Pulitzer-Winning Journalist Claims US Sabotaged Nord Stream Pipeline

Seymour Hersh is a former New York Times and New Yorker reporter who won numerous awards for his investigative journalism, including a 1970 Pulitzer Prize for exposing the My Lai Massacre and its cover-up during the Vietnam War. In his first post to Substack, Hersh details the covert operation the United States conducted last year to blow up the Nord Stream 2 pipeline.

“In the immediate aftermath of the pipeline bombing, the American media treated it like an unsolved mystery,” writes Hersh. “Russia was repeatedly cited as a likely culprit, spurred on by calculated leaks from the White House — but without ever establishing a clear motive for such an act of self-sabotage, beyond simple retribution.” We covered the news last October from an environmental standpoint as it led to what became the biggest single release of climate-damaging methane ever recorded.

In a lengthy and detailed post, citing a source with direct knowledge of the operation, Hersh describes the planning involved, operation itself, and fallout. Slashdot reader r1348 shares an excerpt from Hersh’s report: Last June, the Navy divers, operating under the cover of a widely publicized mid-summer NATO exercise known as BALTOPS 22, planted the remotely triggered explosives that, three months later, destroyed three of the four Nord Stream pipelines, according to a source with direct knowledge of the operational planning.

Two of the pipelines, which were known collectively as Nord Stream 1, had been providing Germany and much of Western Europe with cheap Russian natural gas for more than a decade. A second pair of pipelines, called Nord Stream 2, had been built but were not yet operational. Now, with Russian troops massing on the Ukrainian border and the bloodiest war in Europe since 1945 looming, President Joseph Biden saw the pipelines as a vehicle for Vladimir Putin to weaponize natural gas for his political and territorial ambitions.
Speaking about Biden’s decision to sabotage the pipeline as winter approached, the source said: “I gotta admit the guy has a pair of balls. He said he was going to do it, and he did.” Asked why he thought the Russians failed to respond, he said cynically, “Maybe they want the capability to do the same things the U.S. did. It was a beautiful cover story,” he went on. “Behind it was a covert operation that placed experts in the field and equipment that operated on a covert signal.”

In response to the report, White House spokesperson Adrienne Watson said: “This is false and complete fiction.” Tammy Thorp, a spokesperson for the CIA, similarly wrote: “This claim is completely and utterly false.”

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US NIST Unveils Winning Encryption Algorithm For IoT Data Protection

The National Institute of Standards and Technology (NIST) announced that ASCON is the winning bid for the “lightweight cryptography” program to find the best algorithm to protect small IoT (Internet of Things) devices with limited hardware resources. BleepingComputer reports: ASCON was selected as the best of the 57 proposals submitted to NIST, several rounds of security analysis by leading cryptographers, implementation and benchmarking results, and feedback received during workshops. The whole program lasted for four years, having started in 2019. NIST says all ten finalists exhibited exceptional performance that surpassed the set standards without raising security concerns, making the final selection very hard.

ASCON was eventually picked as the winner for being flexible, encompassing seven families, energy efficient, speedy on weak hardware, and having low overhead for short messages. NIST also considered that the algorithm had withstood the test of time, having been developed in 2014 by a team of cryptographers from Graz University of Technology, Infineon Technologies, Lamarr Security Research, and Radboud University, and winning the CAESAR cryptographic competition’s “lightweight encryption” category in 2019.

Two of ASCON’s native features highlighted in NIST’s announcement are AEAD (Authenticated Encryption with Associated Data) and hashing. AEAD is an encryption mode that provides confidentiality and authenticity for transmitted or stored data, combining symmetric encryption and MAC (message authentication code) to prevent unauthorized access or tampering. Hashing is a data integrity verification mechanism that creates a string of characters (hash) from unique inputs, allowing two data exchange points to validate that the encrypted message has not been tampered with. Despite ASCON’s lightweight nature, NIST says the scheme is powerful enough to offer some resistance to attacks from powerful quantum computers at its standard 128-bit nonce. However, this is not the goal or purpose of this standard, and lightweight cryptography algorithms should only be used for protecting ephemeral secrets. For more details on ASCON, check the algorithm’s website, or read the technical paper (PDF) submitted to NIST in May 2021.

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Bob Iger Announces 7,000 Layoffs As Disney+ Loses Subscribers

Bob Iger, in his first earnings call since returning to the company, announced Walt Disney Co. will shed 7,000 jobs as part of a broader effort to save $5.5 billion in costs. Disney is facing pressure to control costs and boost profits as it continues to lose money from its key streaming business, which includes Disney+. The Los Angeles Times reports: The company’s marquee streaming service Disney+ lost 2.4 million subscribers during the first quarter, bringing its total count to 161.8 million, mainly stemming from declines in its Disney+Hotstar product in India. The service gained subscribers elsewhere, adding 1.4 million subscribers in the U.S. and internationally, not including Hotstar. Overall, Disney’s streaming apps — Disney+, Hulu and ESPN+ — have 235 million subscribers.

Disney’s streaming business continued to bleed cash, losing more than $1 billion during the three months that ended in December. Nonetheless, Disney reported earnings and revenues that beat Wall Street estimates. The company generated sales of $23.5 billion, up 8% from the same quarter a year ago. Analysts on average had been expecting $23.4 billion in revenue. Disney’s profit was $1.28 billion, up 11%. The Burbank entertainment giant’s earnings of 99 cents a share exceeded projections of 78 cents. “After a solid first quarter, we are embarking on a significant transformation, one that will maximize the potential of our world-class creative teams and our unparalleled brands and franchises,” Iger said in a statement. “We believe the work we are doing to reshape our company around creativity, while reducing expenses, will lead to sustained growth and profitability for our streaming business, better position us to weather future disruption and global economic challenges, and deliver value for our shareholders.”
Last November, Disney reappointed Iger as CEO after Iger’s hand-picked successor as CEO, Bob Chapek, came under fire for his management of the entertainment giant.

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EV Batteries Getting Second Life On California Power Grid

Hundreds of used electric vehicle battery packs are enjoying a second life at a California facility connected to the state’s power grid, according to a company pioneering technology it says will dramatically lower the cost of storing carbon-free energy. Reuters reports: B2U Storage Solutions, a Los Angeles-based startup, said it has 25 megawatt-hours of storage capacity made up of 1,300 former EV batteries tied to a solar energy facility in Lancaster, California. The project is believed to be the first of its kind selling power into a wholesale market and earned $1 million last year, according to Chief Executive Freeman Hall. B2U’s technology allows the EV battery packs to be bundled together without having to be taken apart first. Founded in 2019, the company is backed by Japanese trading company Marubeni Corp.

By extending the batteries’ lives, project developers can save both resources and costs. Hall estimates that a system like B2U’s could lower grid-scale battery capital costs by about 40%. “Second life and re-use helps the overall lifecycle be more energy efficient, given all the efforts that go into making that battery,” Hall said in an interview. “So you’re getting maximum value out of it.” Batteries are worked hard during their years powering vehicles, and over time their range deteriorates. But they still hold value as stationary storage, which has gentler demands, Hall said. The batteries in the B2U system are up to 8-years old and once powered vehicles built by Honda and Nissan.

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Maryland Motor Vehicles Agency Wants To Know About Your Sleep Apnea

“Man goes to the doctor for a sleep apnea diagnosis, a few months later he gets a letter from the state of Maryland about his sleep apnea — and they won’t tell him how they found out about it,” writes Slashdot reader schwit1. NBC4 Washington reports: Dr. David Allick, a dentist in Rockville, was diagnosed with mild sleep apnea in June 2022. Months later, he received a letter from the MVA requesting additional information about his diagnosis in order “to determine your fitness to drive.” The September 2022 letter noted failure to return the required forms, which included a report from his physician, could result in the suspension of his license. Allick said he isn’t clear how the state learned about his medical diagnosis. But more importantly, he said he was previously unaware of a little-known Maryland law requiring people to report their sleep apnea diagnosis to state driving authorities. Allick said he still has questions about what prompted the ordeal. “Everybody I talked to — nobody’s heard of anything like this,” he said, also acknowledging: “I’m sure they want to keep the roads safe.” schwit1 adds: “How is this not a HIPAA violation?”

The investigation team at NBC4 Washington found that Allick is one of 1,310 people whose sleep apnea diagnoses “have led to medical reviews by the Maryland MVA.” The state department didn’t have data on how many of these Maryland drivers have had their license suspended.

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Single-Use Plastic Production Rose Between 2019 and 2021 Despite Pledges

Polluting single-use plastic production rose globally by 6 million tons per year from 2019 to 2021 despite tougher worldwide regulations, with producers making “little progress” to tackle the problem and boost recycling, new research showed on Monday. Reuters reports: Single-use plastics have emerged as one of the world’s most pressing environmental threats, with vast amounts of waste buried in landfills or dumped untreated in rivers and oceans. The manufacturing process is also a major source of climate-warming greenhouse gas. But while growth has slowed recently, the production of single-use plastic from “virgin” fossil fuel sources is still nowhere near its peak, and the use of recycled feedstocks remains “at best a marginal activity,” Australia’s Minderoo Foundation said in its Plastic Waste Makers Index. “Make no mistake, the plastic waste crisis is going to get significantly worse before we see an absolute year-on-year decline in virgin single-use plastic consumption,” it said.

Exxon Mobil was at the top of the list of global petrochemical companies producing virgin polymers used in single-use plastics, followed by China’s Sinopec. Sinopec also leads the way when it comes to building new production facilities over the 2019-2027 period, the report said, with more than 5 million tons of annual capacity planned. Exxon Mobil was second with around 4 million tons. […] Around 137 million tons of single-use plastics were produced from fossil fuels in 2021, and it is expected to rise by another 17 million tons by 2027, the researchers said.

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Power Grid Worries Force Amazon To Run Oregon Datacenters Using Fuel Cells

Unable to get the power it needs to feed its growing datacenter footprint, Amazon plans to transition some of its Oregon datacenters over to natural gas fuel cells. The Register reports: First reported by local media, Amazon’s initial plan would involve installing just shy of 75 megawatts of fuel cell capacity across three datacenters with the option to expand that to four additional sites in the future. Fuel cells extract electricity from a fuel like natural gas or hydrogen without the need for combustion. With hydrogen, the only byproducts of this reaction are electricity and water vapor, but with natural gas, CO2 — a potent greenhouse gas — is still produced.

For Amazon, these natural gas fuel cells will be used as the primary energy supply, delivering 24.3 megawatts of power to each of the three datacenter sites. “We are investing in fuel cells as a way to power a small number of our operations in Oregon,” an Amazon spokesperson told The Register in an email. “We continually innovate to minimize our impact on our neighbors, local resources, and the environment and this technology provides a pathway for less carbon intensive solutions in the region.”

Continuing to use fossil fuels to power its datacenters is at odds with Amazon’s stated sustainability goals — which include transitioning facilities to 100 percent renewable energy by 2025. However, sources familiar with the matter tell The Register that Amazon’s decision to use natural gas fuel cells was made in part due to challenges associated with power transmission infrastructure in the region. Oregon Live notes that the e-tail giant has had problems with landowners, who have objected to having high-voltage transmission lines cross their properties. Fuel cells provide Amazon a way to circumvent these headaches by generating the power onsite. However, regulators are concerned that the decision could actually increase Amazon’s carbon footprint in the region as the power supplied by local utilities includes a mix of hydroelectric power. In documents filed with the state, it’s estimated the fuel cells would generate 250,000 metric tons of carbon dioxide annually.

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Binance To Suspend US Dollar Bank Transfers This Week

Binance, the world’s largest cryptocurrency exchange, will suspend U.S. dollar deposits and withdrawals, the company said Monday, without providing a reason for the decision. CNBC reports: Binance US, a unit of the company that’s regulated by the Treasury Department’s Financial Crimes Enforcement Network, said in a tweet that it’s not affected by the suspension. Thus the move applies only to non-U.S. customers who transfer money to or from bank accounts in dollars. Data from Arkham Intelligence shows that following the announcement, there was a sharp spike in outflows from Binance’s crypto wallets, as millions of dollar-pegged stablecoins such as tether and USDC flowed to rival exchanges or individual wallets.

Binance’s net U.S. dollar outflow was over $172 million for the day, based on data from DefiLlama. That represents a tiny amount of money for a company that has $42.2 billion worth of crypto assets, according to Arkham. “We’re still overwhelmingly net-positive on net deposits,” the spokesperson said. “Outflows always tick up when prices start to level off following a bullish market swing like we saw last week as some users take profits.” Bitcoin rose more than 38% in January, its best month since October 2021.

Regarding Monday’s suspension, a Binance representative told CNBC in an email that “Binance.US has its own banking partners and does not have any issues.” The main Binance exchange does not serve U.S. users. Binance said customers can still use other fiat currencies or payment methods to purchase crypto. For the small number affected, “we’ll have a new partner to announce for those users in the next couple weeks,” the spokesperson said.

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