Tuesday, December 20, 2022

CRIMINAL CRYPTO CAPITALI$M
'Big Short' investor Michael Burry says crypto reserve reviews like Binance's are 'essentially meaningless'



Morgan Chittum
Mon, December 19, 2022

Michael Burry
Astrid Stawiarz/Getty Images

Michael Burry commented on news that the accountant that produced Binance's proof-of-reserves report would halt all work for crypto firms.

The legendary "Big Short" investor described proof of reserves, which has been popularized since FTX's implosion, as "essentially meaningless."

Burry was one of the first investors who predicted the subprime mortgage crisis.


Michael Burry, the legendary investor who foresaw the subprime mortgage crisis, is wary of so-called proof of reserves that crypto exchanges have touted since FTX crashed.

The "Big Short" former hedge fund manager tweeted on Friday that such reviews on a firm's digital holdings are "essentially meaningless."

"In 2005 when I started using a new kind of credit default swap, our auditors were learning on the job," Burry tweeted on Friday. "That's not a good thing. Same goes for FTX, Binance, etc. The audit is essentially meaningless."



The tweet came as a comment on news that Mazars, the French accounting firm used by Binance and other larger players in the space to produce proof-of-reserves reports, halted all work with crypto-related clients on Friday.

Binance in particular has touted proof of reserves as a way to assure customers that their assets are secure in an effort to boost transparency amid the FTX scandal.

But critics have said that proof of reserves doesn't provide a complete picture of a company's risks and can be misleading.

There's been a thunderous cry for audits of major crypto firm's following the collapse of FTX, the once $32 billion empire started by Sam Bankman-Fried.


FTX filed for bankruptcy last month after a Coindesk report revealed that FTX's native token FTT was being used to prop up Bankman-Fried's quant trading firm Alameda Research. The embattled firm lost $8 billion of customer money as a result.

Binance's former chief financial officer did not have access to the company's full accounts during his three-year tenure, report says

Morgan Chittum
Mon, December 19, 2022 

Binance logo is displayed on a mobile phone screen
Beata Zawrzel/NurPhoto via Getty Images

Binance's former CFO did not have full access to the company's financial accounts, Reuters reported on Monday.


Binance has financials that are more akin to a "black box," with certain business units submitting "scant information," according to the outlet.


Binance's chief strategy officer said that the report's depictions of its business units are "categorically false."


Binance's former Chief Financial Officer Wei Zhou did not have access to the company's full financial accounts during his nearly three-year tenure, Reuters reported, citing two people who worked with him.

Zhou, who left the Binance in 2021, did not immediately respond to Insider's request for comment.

The report follows promises from Binance CEO Changpeng Zhao, who said that the company would "lead by example" on embracing transparency after the downfall of competitor FTX, the once-$32 billion crypto empire started by Sam Bankman-Fried.

Binance.com, which has processed over $22 trillion worth of trades so far this year, has financials that are more akin to a "black box" and "mostly hidden from public view," according to a Reuter's analysis of the company's corporate filings.

The outlet reviewed filings by Binance entities in over a dozen jurisdictions where the exchange says it has "regulatory licenses, registrations, authorizations and approvals," which include locations like European Union states, Canada, and Dubai.

"The filings show that these units appear to have submitted scant information about Binance's business to authorities," the report said. "The public filings do not show, for example, how much money flows between the units and the main Binance.com exchange. The Reuters analysis also found that several of the units appear to have little activity."

Binance Chief Strategy Officer Patrick Hillmann said that the analysis of the units' filings were "categorically false." "The amount of corporate and financial information that has to be disclosed to regulators in those markets is immense, often requiring a six-month-long disclosure process," he said in a statement to Reuters.

"We are a private company and are not required to publicize our corporate finances," he added.

To be clear, Binance is not required to publish detailed detailed financial statements like its Nasdaq-listed competitor Coinbase. Binance doesn't disclose basic information like where Binance.com is located.

The company also doesn't report revenue, profit, or cash reserves. Binance has its own token, dubbed BNB, but hasn't revealed what role the coin plays on its balance sheet yet.

Binance published a "snapshot" of its holdings of six major tokens on its website last month and released a proof of reserves earlier this month, though critics have said such information is incomplete and can be misleading.

"It lends customers money against their crypto assets and lets them trade on margin, with borrowed funds. But it doesn't detail how big those bets are, how exposed Binance is to that risk, or the full extent of its reserves to finance withdrawals," the Reuters report said.

Binance did not immediately respond to Insider's request for comment on the matter.

The US Department of Justice is investigating Binance over potential money laundering conspiracy, unlicensed money transmission, and criminal sanctions violations, four sources told Reuters. Binance also reportedly processed over $10 billion in illegal payments this year.

A Binance spokesperson told Insider that it would be "inappropriate for us to comment" on matters related to the DOJ.

Binance's books are a black box, filings show, as crypto giant tries to rally confidence

Mon, December 19, 2022 
By Tom Wilson, Angus Berwick and Elizabeth Howcroft

LONDON (Reuters) - The world's biggest crypto exchange, Binance, is battling to shore up confidence after a surge in customer withdrawals and a steep drop in the value of its digital token.

The exchange said it dealt with net outflows of around $6 billion over 72 hours last week "without breaking stride" because its finances are solid and "we take our responsibility as a custodian seriously." After the collapse of rival exchange FTX last month, Binance's founder Changpeng Zhao promised his company would "lead by example" in embracing transparency.

Yet a Reuters analysis of Binance's corporate filings shows that the core of the business – the giant Binance.com exchange that has processed trades worth over $22 trillion this year – remains mostly hidden from public view.

Binance declines to say where Binance.com is based. It doesn't disclose basic financial information such as revenue, profit and cash reserves. The company has its own crypto coin, but doesn't reveal what role it plays on its balance sheet. It lends customers money against their crypto assets and lets them trade on margin, with borrowed funds. But it doesn't detail how big those bets are, how exposed Binance is to that risk, or the full extent of its reserves to finance withdrawals.

Changpeng Zhao, Binance's Chief Executive Officer attends the B20 Summit, ahead of the G20 leaders' summit, in Nusa Dua, Bali, Indonesia, November 14, 2022.
REUTERS/Willy Kurniawan

Binance is not required to publish detailed financial statements because it is not a public company, unlike U.S. rival Coinbase, which is listed on the Nasdaq. Nor has Binance raised outside capital since 2018, industry data show, which means it hasn't had to share financial information with external investors since then.

And as Reuters reported in October, Binance has actively avoided oversight. Zhao approved a plan by lieutenants to "insulate" Binance's main operation from U.S. regulatory scrutiny by setting up a new American exchange, according to company messages and interviews with former employees, advisers and business associates. Zhao denied signing off on the plan and said the unit was set up with advice from top law firms.

Binance's huge role in the crypto market – it accounts for over half of all trading volume – has made its operations a keen topic of interest for U.S. regulators. The company is under investigation by the U.S. Justice Department for possible money-laundering and sanctions violations, and Reuters reported this month that some prosecutors believe they have gathered sufficient evidence to charge Binance and some top executives.

In an effort to look inside Binance's books, Reuters reviewed filings by Binance units in 14 jurisdictions where the exchange on its website says it has "regulatory licenses, registrations, authorisations and approvals." These locations include several European Union states, Dubai and Canada. Zhao has described the authorisations as milestones in Binance's "journey to being fully licensed and regulated around the world."

Representations of cryptocurrencies are seen in front of displayed Binance logo in this illustration taken November 10, 2022. REUTERS/Dado Ruvic/Illustration

The filings show that these units appear to have submitted scant information about Binance's business to authorities. The public filings do not show, for example, how much money flows between the units and the main Binance.com exchange. The Reuters analysis also found that several of the units appear to have little activity.

Former regulators and ex-Binance executives say these local businesses serve as window dressing for the main unregulated exchange.

"They are co-opting the nomenclature of regulation to create a veneer of legitimacy," said John Reed Stark, a former chief of the U.S. Securities and Exchange Commission's Office of Internet Enforcement. Stark said Binance's operations were more opaque even than those of FTX. "There is absolutely no transparency, no sunlight, no confirmation of any kind about its financial position."

Binance Chief Strategy Officer Patrick Hillmann said the Reuters analysis of the units' filings in the 14 jurisdictions was "categorically false." "The amount of corporate and financial information that has to be disclosed to regulators in those markets is immense, often requiring a six-month-long disclosure process," he said. "We are a private company and are not required to publicize our corporate finances," he continued, comparing the exchange to privately-held firms such as U.S. candy maker Mars. In a statement, Mars said it was "absurd" to compare its corporate governance and financial reporting requirements with Binance's, adding that its goods and services are "highly regulated."

Hillmann also noted that FTX's founder stands accused by U.S. authorities of fraud. If those allegations are true, he said, "it would have been fraud regardless of what regulations were in place."

PIECES OF A JIGSAW


Binance's surge in outflows last week was attributed by analysts to concern over how crypto exchanges hold user funds and the Reuters report on the DOJ investigation. The exchange also halted withdrawals of some crypto tokens. On Friday, Binance's attempts to reassure investors were set back when an accounting firm it hired to verify its reserves suspended all work for crypto firms.

There are glimpses of Binance's finances in public comments by Zhao, past company statements, blockchain data and venture capital deals.

Binance has said it has over 120 million users. Its trading volumes totalled $34 trillion in 2021, Zhao said in June. He told an interviewer last month that "90-something percent" of Binance's revenues depend on crypto trading. The company is profitable and has "fairly large cash reserves," he added. Binance has made over 150 venture investments totalling $1.9 billion since 2018, according to PitchBook data. Zhao also created a $1 billion fund to invest in struggling crypto companies after the fall of FTX.

Reliable estimates of Binance's trading-dependent revenues are scarce, however, despite the public availability of trading volume data.

Binance charges fees of up to 0.1% on spot trades, with a more complex fee structure for derivatives. On spot trading volume of $4.6 trillion in the year to October, Binance may have earned revenue of up to $4.6 billion, Reuters calculated, based on data from researcher CryptoCompare. Charging fees of up to 0.04% on its derivatives volumes of $16 trillion, Binance may have earned revenues of up to $6.4 billion.

John Todaro, a senior analyst covering crypto and blockchain firms at U.S. investment bank and asset manager Needham & Company, and Joseph Edwards, an independent investment consultant, said the Reuters calculations appeared to be in the right range. Binance's promotions such as zero-fee trading and other discounts may mean the revenues were lower, Edwards said. A third crypto analyst who declined to be named also agreed with the figures.

Binance's Hillmann did not comment on the Reuters estimates. "The vast majority of our revenue is made on transaction fees," he said, adding that the exchange has been able to "accumulate large corporate reserves" by keeping expenses down. Binance's "capital structure is debt free" and the company keeps its money made from fees separate from the assets it buys and holds for users, Hillmann said.

Binance allows users to deposit collateral in the form of crypto and borrow funds to leverage the value of their derivatives trades by as much as 125 times. For the user, this can lead to huge gains or huge losses. Hillmann said Binance backs all user deposits for derivatives and spot trading with its own reserves at a ratio of one to one – meaning deposits should be secure and easy to withdraw. Binance, he said, has strict liquidation protocols that sell off users' positions if their losses exceed their collateral's value. If users' positions become negative "due to extreme market volatility," Binance has "very-well capitalized" insurance funds to cover the deficit, he said. Hillmann did not provide specifics and Reuters could not independently verify all of his statements.

Asked about the scale of any losses at the exchange this year, Hillmann said: "Binance's risk department manages what is one of the industry's most risk-averse programs. This protects our users and our platform."

The guarding of Binance's financial information by Zhao, a Canadian citizen who was born and raised in China, echoes the strict culture of secrecy he has enforced throughout his company's rise, the Reuters report in October showed. The article was one of a series of reports this year by the news agency on Binance's financial compliance and relationship with regulators across the world.

Even Binance's former chief financial officer, Wei Zhou, did not have access to the company's full accounts during his three-year tenure, according to two people who worked with him. Zhou, who left last year, did not respond to requests for comment.


Zhao Changpeng, founder and chief executive officer of Binance speaks during an event in Athens, Greece, November 25, 2022.
 REUTERS/Costas Baltas

"FULL TRANSPARENCY"

Zhao and other executives have consistently declined to publicly identify which entity controls the main exchange. But in a private court submission filed in 2020 in an arbitration case in the Cayman Islands, Chief Compliance Officer Samuel Lim said it is owned and operated by a Cayman Islands company, Binance Holdings Limited.

This year, Binance has won licenses or approvals from authorities in locations including France, Spain, Italy and Dubai. Zhao lauded these advances, saying in May that Binance's registration as a crypto service provider in Italy would allow it to operate "in full transparency." Yet none of the units registered with local regulators provide a clear window into the main Binance exchange, the Reuters analysis showed.

Reuters asked authorities in all 14 jurisdictions about their oversight of Binance's local units. Of the eight that responded, six – in Spain, New Zealand, Australia, Canada, France and Lithuania – told Reuters their role did not involve supervising the main exchange, and said the units were only required to meet local requirements on reporting suspicious transactions.

Reuters also asked representatives of the local Binance units and affiliates about their relationship with the main Binance exchange. Only one responded, a South African firm called FiveWest. Its managing director, Pierre van Helden, said Cape Town-based FiveWest receives a "minimal yearly license fee" from Binance to facilitate crypto derivatives trading for Binance's South African users.

"How Binance operates globally is unclear to us," van Helden said. He added that Zhao's company was "cooperative" on compliance and said FiveWest has regular meetings to ensure requirements are met.

In Italy, Binance's public corporate filings detail just the unit's capital base and its ownership by a separate Binance company in Ireland. The Italian company, Binance Italy S.R.L., has its listed address in a block of shops and apartments in the southern city of Lecce. It did not respond to a request for comment, nor did the Organismo Agenti e Mediatori authority with which it is registered.

Just two of the Binance units analysed by Reuters offer more substantial details in their filings.

One, a Lithuanian firm called Bifinity UAB, offers the most detailed picture. Bifinity described itself in one regulatory filing as the "official fiat-to-crypto payments provider for Binance." Fiat means dollars, euros and other traditional currencies.

Bifinity also disclosed that Binance and its companies are its "main strategic business partners." In a 2021 annual report, Bifinity reported 137 million euros ($145 million) in net profit and assets of 816 million euros. Bifinity said it had made payments of 421 million euros to a single related party, with some 185 million euros in "related expenses," but did not specify whether this party is Binance.

Bifinity, whose annual report said it has 147 employees, does not have a website or publicly provide any contact details. The company's chief executive, Saulius Galatiltis, did not respond to requests for comment. At its registered address at a business centre in Lithuania's capital Vilnius, Bifinity is not listed on the tenants' board.

The other Binance unit that offers more than barebones financial details is in Spain. It registered in July with the Spanish central bank and reported meagre revenue of some 1.5 million euros last year and a profit of just 9,000 euros. Reuters could not reach anyone from the unit, Binance Spain SL, for comment. A reporter visited its registered address, at a co-working space in Madrid. The receptionist said a small Binance Spain team had relocated a month ago, without leaving contact details.

In the Gulf, Binance has won a license or permission this year in Abu Dhabi, Bahrain and Dubai. Zhao told Bloomberg in March that he will be based for the "foreseeable future" in Dubai. Filings by Binance's Dubai entities give no details of its financial activity or its ties to the main Binance platform.

Even for some employees inside the company, such details were unclear.

Binance didn't disclose global profit figures during its application for a license in Dubai, according to a person with direct knowledge of the application. Nearly all clients in the United Arab Emirates registered with Binance's main exchange, and until at least late summer the licensed Dubai firm was not experiencing significant trading revenues, the person said.

Reuters was not able to contact the unit, Binance FZE, registered to a WeWork office by the Dubai World Trade Centre. Binance's Middle East and North Africa head did not respond to a request for comment. Nor did Dubai's Virtual Assets Regulatory Authority.
"PROOF OF RESERVES"

Many crypto exchanges, including Binance competitors Huobi and OKX, operate from offshore locations such as the Seychelles – as did Bahamas-based FTX. Standards on corporate transparency and financial reporting are typically looser in such jurisdictions than in the United States.

Coinbase, the biggest U.S. exchange, listed on Wall Street in 2021. Like other public companies, it must file audited quarterly earnings statements and annual financial reports. In its latest earnings statement, Coinbase reported data including revenue, profit, cash holdings and trading volumes.

"It's really night and day," said Mark Palmer, head of digital assets research at U.S. financial services firm BTIG, of the difference between disclosures by a listed company and other offshore exchanges.

"Coinbase is a publicly traded company and is required to share that information with investors, whereas we are a private company and do not have public investors to whom we are beholden," Binance's Hillmann said. "The main reason to go public is to raise money, but as Binance doesn't need to raise money, there is no need to go public at this time."


A representation of the cryptocurrency is seen in front of Coinbase logo in this illustration taken, March 4, 2022. REUTERS/Dado Ruvic/Illustration

A Coinbase spokesman, Elliott Suthers, said the company's financials were reviewed quarterly by Deloitte, one of the "Big Four" accounting firms, "so customers don't have to rely on our word." "We believe exchanges have a responsibility to share their financials with their customers," Suthers said. "We encourage other exchanges to take this same approach."

Some privately held exchanges reveal financial data during fundraising, as did FTX prior to its collapse. Binance, however, has not raised money from outside investors since 2018, according to data from business information provider Crunchbase. "We do not have VC investments, so we don't owe anybody any money," Zhao told CNBC on Dec. 15.

U.S. prosecutors last week charged FTX founder Sam Bankman-Fried with defrauding equity investors and customers of billions of dollars. It has emerged that money was secretly moving from FTX to Bankman-Fried's hedge fund, Alameda Research, which functioned as a market maker, a dealer that deepens liquidity by buying and selling the same assets.

Reuters could not determine if Binance or Zhao also own any market-making firms that operate on its platform. In December 2020, the SEC issued a subpoena to Binance.US, the separate American exchange, requesting it provide information about all its market makers, their owners, and their trading activity.

As part of a "commitment to transparency," Binance last month published on its website a "snapshot" of its holdings of six major tokens and promised to share a complete set of data at an unspecified future date.

Data firm Nansen said the holdings, worth around $70 billion at the time of the Nov. 10 snapshot, had fallen to $54.7 billion by Dec. 17 after withdrawals and price fluctuations. Two "stablecoins" that are pegged to the dollar – Binance's BUSD and market leader Tether – accounted for almost half of its holdings. Around 9% of the assets were in BNB, its in-house token which Binance itself has issued, the Nansen data showed.

BNB is the fifth-largest crypto coin in circulation with a market value of around $40 billion, industry data show. Holders of the token receive discounts on Binance's trading fees. Zhao has said that Binance does not use BNB as collateral. Alameda used FTX's in-house FTT token as collateral when borrowing from FTX and other lenders.

After FTX's collapse, Zhao said audits of crypto exchanges were not guaranteed to prevent bankruptcies. "More audits are really good, but I'm not sure if they would prevent this particular case," he told a TechCrunch interviewer.

Zhao told a conference in April that Binance is "fully audited." Asked by the Financial Times who was auditing Binance's financial results and balance sheet, Zhao said the company had "multiple auditors in multiple places … I don't have all of the list in my head."

He now advocates so-called "proof-of-reserves" checks on the crypto holdings of exchanges. The system is supposed to allow users to confirm that their holdings are included in checks of blockchain data and that the exchange's reserves match clients' assets.

Binance hired accounting firm Mazars to check Binance's bitcoin holdings. The firm examined the holdings as they existed at the end of one day in November. In a Dec. 7 report, Mazars found that Binance's bitcoin assets exceeded its customer bitcoin liabilities. It said the check, known as an "agreed-upon procedures engagement," was "not an assurance engagement" in which auditors personally sign off on their attestations of accounts. Nevertheless, Zhao tweeted, "Audited proof of reserves. Transparency."

Mazars later deleted the webpage containing the report. Its communications director, Josh Voulters, said on Friday it had "paused" its proof-of-reserves checks for crypto firms "due to concerns regarding the way these reports are understood by the public." Voulters didn't respond to requests for more detail.

While this checking system offers a degree of insight into an exchange's reserves, it's no substitute for a full audit, seven analysts, lawyers and accountancy experts told Reuters.

In offering only a limited snapshot of an exchange's crypto, the system lacks safeguards, two lawyers said. Others said it could not yield the same level of detail on corporate finances as a traditional audit.

"In terms of the balance sheet from Binance, there really is no colour," said Todaro, the analyst at Needham & Company.

((reporting by Tom Wilson, Angus Berwick and Elizabeth Howcroft in London; Additional reporting by Mathieu Rosemain in Paris, Andrius Sytas in Vilnius, David Latona in Madrid, and Olzhas Auyezov in Almaty; editing by Janet McBride))

IT'S A FEINT

Binance.US to buy Voyager Digital’s assets for $1 billion

It’s been a long year for Voyager Digital. After filing for bankruptcy, the crypto lender thought it would be able to return some funds to its customers by selling its assets to FTX. As you know, things haven’t been going well at FTX either. That’s why Binance.US is stepping in today and offering to buy Voyager Digital’s assets for $1.022 billion.

It all started with the default of Three Arrows Capital earlier this year. It had some large repercussions across the crypto ecosystem. In particular, Voyager Digital realized that Three Arrows Capital owed it more $650 million. It had no choice but to file for Chapter 11 as a result.

“After a review of strategic options focused on maximizing value returned to customers on an expedited timeframe, Binance.US has been selected as the highest and best bidder for our assets,” Voyager Digital said on Twitter today.

With today’s bid, Binance.US agreed to buy Voyager’s crypto portfolio for $1.002 billion. It is also spending another $20 million for other assets of “incremental value”.

Binance.US wants to return crypto to Voyager Digital’s customers. They will be able to connect to Binance.US and see some crypto assets based on their previous positions on Voyager Digital.

“Upon close of the deal, users will be able to seamlessly access their digital assets on the Binance.US platform where they will continue to receive future disbursements from the Voyager estate,” Binance.US CEO Brian Shroder said in a statement.

Of course, users will also be able to liquidate their positions and get cash. But Binance.US will likely gain new users with this deal. Some of them may start using Binance.US as their crypto exchange. Others will just sign up to withdraw their Voyager Digital funds.

Last month, Binance CEO Changpeng Zhao, also known as CZ, said that its U.S. arm would make a new bid for Voyager Digital’s assets. “Binance.US will make another bid for Voyager now, given FTX is no longer able to follow through on that commitment,” he said.

The deal hasn’t closed just yet. Due to the Chapter 11 process, there will be a court hearing on January 5, 2023. The Bankruptcy Court will decide if it approves the deal.

CRIMINAL CRYPTO CAPITALI$M
Insurers shun FTX-linked crypto firms as contagion risk mounts



FTX logo and representation of cryptocurrencies

Sun, December 18, 2022 

By Noor Zainab Hussain and Carolyn Cohn

(Reuters) - Insurers are denying or limiting coverage to clients with exposure to bankrupt crypto exchange FTX, leaving digital currency traders and exchanges uninsured for any losses from hacks, theft or lawsuits, several market participants said.

Insurers were already reluctant to underwrite asset and directors and officers (D&O) protection policies for crypto companies because of scant market regulation and the volatile prices of Bitcoin and other cryptocurrencies.

Now, the collapse of FTX last month has amplified concerns.

Specialists in the Lloyd's of London and Bermuda insurance markets are requiring more transparency from crypto companies about their exposure to FTX. The insurers are also proposing broad policy exclusions for any claims arising from the company's collapse.

Kyle Nichols, president of broker Hugh Wood Canada Ltd, said insurers were requiring clients to fill out a questionnaire asking whether they invested in FTX, or had assets on the exchange.

Lloyd's of London broker Superscript is giving clients that dealt with FTX a mandatory questionnaire to outline the percentage of their exposure, said Ben Davis, lead for digital assets at Superscript.

"Let's say the client has 40% of their total assets at FTX that they can't access, that is either going to be a decline or we're going to put on an exclusion that limits cover for any claims arising out of their funds held on FTX," he said.

The exclusions denying payout for any claims arising out of the FTX bankruptcy are found in insurance policies that cover the protection of digital assets and for personal liabilities of directors and officers of companies that deal in crypto, five insurance sources told Reuters. A couple of insurers have been pushing for a broad exclusion to policies for anything related to FTX, a broker said.

Exclusions may act as a failsafe for insurers, and will make it even more difficult for companies that are seeking coverage, insurers and brokers said.

Bermuda-based crypto insurer Relm, which previously has provided coverage to entities linked to FTX, takes an even stricter approach.

"If we have to include a crypto exclusion or a regulatory exclusion, we're just not going to offer the coverage," said Relm co-founder Joe Ziolkowski.

D&O QUESTION

Now, one of the most pressing questions is whether insurers will cover D&O policies at other companies that had dealings with FTX, given the problems facing exchange's leadership, Ziolkowski said.

U.S. prosecutors say former FTX Chief Executive Officer Sam Bankman-Fried engaged in a scheme to defraud FTX's customers by misappropriating their deposits to pay for expenses and debts and to make investments on behalf of his crypto hedge fund, Alameda Research LLC.

A lawyer for Bankman-Fried said on Tuesday his client is considering all of his legal options.

D&O policies, which are used to pay legal costs, do not always pay out in cases of fraud.

Insurance sources would not name their clients or potential clients that could be affected by policy changes, citing confidentiality. Crypto firms with financial exposure to FTX include Binance, a crypto exchange, and Genesis, a crypto lender, neither of which responded to e-mails seeking comment.

While the least risky parts of the crypto market, such as companies that own cold wallets storing assets on platforms not connected to the internet, may get cover for up to $1 billion, a D&O insurance policyholder's cover may now be limited to tens of millions of dollars for the rest of the market, Ziolkowski said.

The FTX collapse will also likely lead to a rise in insurance rates, especially in the U.S. D&O market, insurers said. The rates are already high because of the perceived risks and lack of historical data on cryptocurrency insurance losses.

A typical crime bond -- used to protect against losses resulting from a criminal act -- would cost $30,000 to $40,000 per $1 million of coverage for a digital assets trader. That compares with a cost of about $5,000 per $1 million for a traditional securities trader, Hugh Wood Canada's Nichols said.

(Reporting by Noor Zainab Hussain in Bengaluru and Carolyn Cohn in London; Editing by Lananh Nguyen and Anna Driver)


OUT OF THE FIRE INTO THE FRYING PAN


This 26-year-old FTX customer lost access to $14,000 when Sam Bankman-Fried's exchange collapsed. Now he plans to keep his money in stocks.

455
Phil Rosen
Mon, December 19, 2022

Daniil Pemberton, 26, lost access to about $14,000 in the collapse of FTX.
Daniil Pemberton

In an interview with Insider, Daniil Pemberton said the collapse of FTX has rattled his trust in companies within crypto sector.

The 26-year-old lost access to about $14,000 in his FTX account, which included bitcoin and ether.

Moving forward, he plans to stick to stocks and index funds.


On November 8, when Daniil Pemberton saw headlines on the collapse of Sam Bankman-Fried's crypto exchange, he tried to transfer funds out of his FTX account. He soon realized that wouldn't be possible.

Based in the Netherlands, the 26-year-old graduate student said he had 1.25 ether and 0.64 bitcoin saved on his account, which at the time were worth about $13,825 all together.

When he tried to initiate a withdrawal, the app showed the transaction was pending, but nothing happened beyond that. When Pemberton checked the cryptocurrency wallet addresses he tried to send the money to, his balance remained at zero. Insider has reviewed these documents.

"The tech itself, the crypto, seems fine, but the problem is the institutions around it," Pemberton told Insider. "They are the ones who undermine the trust, because at any point a platform could make a bad decision, which leads them to becoming bankrupt, and everyone loses. There's no safety net."

FTX filed for bankruptcy on November 11, and Bankman-Fried stepped down as CEO. The Securities and Exchange Commission has since alleged that he orchestrated a years-long scheme to defraud investors.

The new chief executive, John Ray III, has said that FTX had haphazard accounting and that there was "no record keeping whatsoever." FTX also reportedly transferred billions of dollars in customer funds to Bankman-Fried's Alameda crypto hedge fund.

"I lost faith in the companies within crypto," Pemberton said. "I'm skeptical on who to entrust with my funds."

While it's possible FTX users can recoup some of their funds during bankruptcy proceedings, experts warn it could months or years — if at all.

Pemberton said one of the main reasons he chose FTX to store his cryptocurrency was that everyone seemed to praise it, including many finance influencers on YouTube that he followed.

"The New York Times had wrote about Sam Bankman-Fried, and so did other prestigious publications and individuals. I thought surely they did their research and wouldn't praise him without due diligence," Pemberton noted.

He also found the promise of FTX's high interest-rate payments appealing, and that they remained high during a time when other platforms were giving lower yields on investments. "In retrospect it was a dumb decision. I had gotten greedy."
Pivoting to traditional investments

In the implosion of FTX, Pemberton said he lost approximately 60% of his total portfolio, including stocks and holdings across other exchanges, including Binance. Moving forward, he plans to put more weight in traditional equities.

"I'm going to pivot more to stocks," he said. "Stocks have more policies in place in case something goes wrong."

Johnson & Johnson, Coca-Cola, and the Vanguard S&P 500 ETF are all on his list as stable, long-term investments, Pemberton said.

"This whole thing shocked me so much that I don't want any more volatility. I'll invest in more index funds and bonds too."

What’s the coldest spot on Earth? NASA has pinpointed it       and the nights are deadly


If you think a little cold air and snow might bolster your holiday spirits, NASA says it knows the perfect destination for frigid Christmas and New Year’s celebrations.

“Looking for the coldest place to spend the holiday season?” the space agency asked in a Facebook post.

“You won’t find anyone else there, but the coldest place we’ve found on Earth (with the help of NASA Earth satellites) is a high ridge on the East Antarctic Plateau.”

Just be sure to bundle up. Temperatures on the ridge “can drop to 135 degrees (Fahrenheit) below zero” on winter nights, NASA says.

At that point, even gasoline freezes

NASA first reported finding the planet’s coldest spot in 2013, and the plateau has continued to hold the dubious honor every year since.

The National Snow and Ice Data Center concluded the East Antarctic Plateau was the coldest place in the world after analyzing 32 years of data from several satellites, NASA says. The hollows on the plateau are considered the coldest spots.

“Near a high ridge that runs from Dome Arugs to Dome Fuji, the scientists found clusters of pockets that have plummeted to record low temperatures dozens of times,” officials reported. “The lowest temperature the satellites detected - minus 136° F (minus 93.2° C), on Aug. 10, 2010.”

Scientists attribute the plateau’s dangerous temperatures to a combination of air that is “stationary for extended periods, while continuing to radiate more heat away into space.”

However, the plateau is not “the coldest permanently inhabited place on Earth,” experts say. That’s located in northeast Siberia, “where temperatures dropped to a bone-chilling 90 degrees below zero F (minus 67.8° C) in the towns of Verkhoyansk (in 1892) and Oimekon (in 1933).”


Mark Zuckerberg
Despite criticism, Meta CEO Mark Zuckerberg is still all-in on the metaverse.Stephen Lam/Reuters
  • Meta's chief tech officer wrote in a blog post on Monday that the company is committed to the metaverse.

  • Meta will continue to invest 20% of its spending on the efforts.

  • The post comes after the consulting CTO of its virtual-reality initiative left the company last week.

Meta is sticking with the metaverse.

In a blog post on Monday titled "Why we still believe in the future," the company's chief technology officer Andrew Bosworth wrote that Meta, formerly known as Facebook, will continue to invest 20% of its spending in Reality Labs, the division in charge of its virtual-reality efforts, which is integral to its metaverse plans.

"It's a level of investment we believe makes sense for a company committed to staying at the leading edge of one of the most competitive and innovative industries on earth," Bosworth wrote.

Bosworth addressed criticism that the company was diverting attention away from its core platforms like Instagram to focus on the metaverse.

"We continue to direct the majority of our investments toward our family of apps as we believe strength in the core can support an ambitious agenda for the future," he wrote.

The post comes after John Carmack, who was the consulting CTO of Meta's virtual-reality initiative, including its Meta Quest headset, left the company last week. In a letter seen by Insider, Carmack said he "wearied of the fight" with Meta.

"We built something pretty close to the right thing," Carmack said in the note. "The issue is our efficiency."

He added, "I have never been able to kill stupid things before they cause damage, or set a direction and have a team actually stick to it."

In the blog post, Bosworth said that the Meta Quest Pro was among the "foundational pieces of technology enabling our vision for the future," and that 2022 will be remembered for getting those technologies "into the hands of developers and users for the first time."

Meta CEO Mark Zuckerberg has gone all in on the metaverse, a concept that describes a form of virtual connectivity, which he sees as the future of the internet.

So far, the effort has been hit with reported roadblocks. The Wall Street Journal reported earlier this year that Meta's virtual worlds had little engagement and daily active users were below the company's projections.

Meanwhile, Meta has made drastic cutbacks this year ahead of a potential economic downturn, including laying off 11,000 employees last month.

"During boom times, it's easy to make big, ambitious investments in what's coming next," Bosworth wrote in his Monday post. "But when economic conditions turn, it's just as easy to turn the other way: cut back on your ambitions, stick to what's safest and most profitable today, and squeeze as much as you can from it."

He added, "We've all seen the disastrous consequences of this kind of short-term thinking: hollowed out companies that gave up on innovating long ago, content to just turn the crank on an existing business until it stops working."

HOW AMSTERDAM BECAME THE FIRST BOURSE
Dutch leader apologizes for Netherlands' role in slave trade

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Monument for Slavery, by Alex da Silva, is seen in Rotterdam, Netherlands, Monday, Dec. 19, 2022. The Dutch government is expected to issue a long-awaited formal apology for its role in the slave trade, with a speech by Dutch Prime Minister Mark Rutte, and ceremonies in the former colonies.
 (AP Photo/Peter Dejong)

MIKE CORDER
Mon, December 19, 2022 

THE HAGUE, Netherlands (AP) — Dutch Prime Minister Mark Rutte apologized Monday on behalf of his government for the Netherlands’ role in slavery and the slave trade, in a speech welcomed by activists as historic but lacking in concrete plans for repair and reparations.

“Today I apologize,” Rutte said in a 20-minute speech that was greeted with silence by an invited audience at the National Archive.

Ahead of the speech, Waldo Koendjbiharie, a retiree who was born in Suriname but lived for years in the Netherlands, said an apology was not enough.

“It’s about money. Apologies are words and with those words you can’t buy anything,” he said.

Rutte told reporters after the speech that the government is not offering compensation to “people — grandchildren or great grandchildren of enslaved people.”

Instead, it is establishing a 200 million-euro ($212 million) fund for initiatives to help tackle the legacy of slavery in the Netherlands and its former colonies and to boost education about the issue.

Rutte apologized “for the actions of the Dutch state in the past: posthumously to all enslaved people worldwide who have suffered from those actions, to their daughters and sons, and to all their descendants into the here and now.”

Describing how more than 600,000 African men, women and children were shipped, "like cattle" mostly to the former colony of Suriname, by Dutch slave traders, Rutte said that history often is “ugly, painful, and even downright shameful.”

Rutte went ahead with the apology even though some activist groups in the Netherlands and its former colonies had urged him to wait until July 1 of next year, the anniversary of the abolition of slavery 160 years ago and said they had not been sufficiently consulted in the process leading up to the speech. Activists consider next year the 150th anniversary because many enslaved people were forced to continue working in plantations for a decade after abolition.

Mitchell Esajas, director of an organization called The Black Archives and a member of activist group Black Manifest, did not attend the speech despite being invited because of what he called the “almost insulting” lack of consultations with the Black community.

He said it was a historic moment but lamented the lack of a concrete plan for reparations.

“Reparation wasn’t even mentioned," Esajas said. "So, beautiful words, but it’s not clear what the next concrete steps will be.”

Rutte's gave his speech at a time when many nations' brutal colonial histories have received critical scrutiny because of the Black Lives Matter movement and the police killing of George Floyd, a Black man, in the U.S. city of Minneapolis on May 25, 2020.

The prime minister's address was a response to a report published last year by a government-appointed advisory board. Its recommendations included the government's apology and recognition that the slave trade and slavery from the 17th century until abolition "that happened directly or indirectly under Dutch authority were crimes against humanity.”

The report said that what it called institutional racism in the Netherlands “cannot be seen separately from centuries of slavery and colonialism and the ideas that have arisen in this context.”

Dutch ministers fanned out Monday to discuss the issue in Suriname and former colonies that make up the Kingdom of the Netherlands — Aruba, Curacao and Sint Maarten as well as three Caribbean islands that are officially special municipalities in the Netherlands, Bonaire, Sint Eustatius and Saba.

In Suriname, , the small South American nation where Dutch plantation owners generated huge profits through the use of enslaved labor, the largest opposition party, NDP, condemned the Dutch government for failing to adequately consult descendants of enslaved people in the country. Activists in the country say that what's really needed is compensation.

“The NDP therefore expresses its disapproval of this unilateral decision-making process and notes that the Netherlands is comfortably taking on the role of the mother country again," the party said in a statement.

The year starting July 1, 2023, will be a slavery memorial year in which the Netherlands “will pause to reflect on this painful history. And on how this history still plays a negative role in the lives of many today,” the government says.

The Dutch first became involved in the trans-Atlantic slave trade in the late 1500s and became a major trader in the mid-1600s. Eventually, the Dutch West India Company became the largest trans-Atlantic slave trader, said Karwan Fatah-Black, an expert in Dutch colonial history and an assistant professor at Leiden University.

In 2018, Denmark apologized to Ghana, which it colonized from the mid-17th century to the mid-19th century. In June, King Philippe of Belgium expressed “deepest regrets” for abuses in Congo. In 1992, Pope John Paul II apologized for the church’s role in slavery. Americans have had emotionally charged fights over taking down statues of slaveholders in the South.

Now the Netherlands has joined their ranks.

But for some in the Black community, the notable day was tinged with disappointment.

“For a lot of people, it’s a very beautiful and historic moment but with — in Dutch we say — a bitter taste ... and it should have been a historic moment with a sweet taste,” Esajas said.

___

Gerold Rozenblad in Paramaribo, Suriname, contributed.

___

Read all AP stories on racial issues at https://apnews.com/hub/racial-injustice.
The Medea Hypothesis: Why some experts say life on Earth sows the seeds of its own destruction

Story by Troy Farah • SALON - Yesterday 

To quote a famous fictional lion, the Earth is a beautiful circle of life — predators and prey, plants and animals keeping each other in perfect balance. This idea — of Earth's lifeforms as epitomizing a collective, life-cultivating system — has a long history: the ancient Greeks called Earth "Gaia," the mother of all life. In the 1970s, two scientists hypothesized that planet Earth is really one giant super-organism, with all animals, plants, fungi and other life actively influencing (and encouraging) one another's evolution; Lynn Margulis, an evolutionary biologist, and James Lovelock, a scientist, environmentalist and futurist, accordingly called their theory the Gaia hypothesis.


Planet earth frozen in a block of ice
Getty Images/Andrew Bret Wallis

"Life clearly does more than adapt to the Earth," Lovelock told Salon in an interview from 2000. "It changes the Earth to its own purposes. Evolution is a tightly coupled dance, with life and the material environment as partners. From the dance emerges the entity Gaia."

It is a nice idea, to think that life begets life — or that life on Earth works towards a larger purpose of self-perpetuation. The only problem is that this isn't a universally accepted proposition among scientists. Indeed, some believe the opposite is true: life on Earth doesn't have a larger goal, but rather, could accidentally and at any moment evolve in a way that would kill off great masses of life — or even all life.

Evidence for this much more cynical theory about life on Earth includes, for one, the numerous mass extinctions that have occurred throughout Earth's 4.5 billion year history, some of which extinguished 99 percent of all life. Some of these extinctions were caused not by asteroids, but by life itself behaving in its own self-interest.

Thus, some scientists say that Gaia, the mother of life, is a poor choice of deity to serve as a metonym for Earth. A better one might be Medea, an enchantress in Greek myth who murdered her own children.

"This name thus seems appropriate for an interpretation of Earth life ... to be inherently selfish and ultimately biocidal."

In the late 2000s, Peter Douglas Ward, a paleontologist and professor at the University of Washington in the geology, biology and astronomy departments, coined the term "Medea hypothesis" to describe the ways that complex life eventually generate the circumstances to drive their own extinction. The term was meant to evoke the Gaia hypothesis, the Medea hypothesis being somewhat of an opposite.

We see Medea's handiwork all around us in the fossil record. The Great Oxidation Event, some 2.45 billion years ago, is a prime example. Back then, the planet was all but devoid of oxygen, and microbial life metabolized just fine without it. But then cyanobacteria hopped on the scene, which evolved photosynthesis. That ended up spitting out tons of oxygen over millions of years, which was toxic to most life on earth, causing widespread death that shows up in the fossil record.

Related
Is Earth a self-regulating organism? New study suggests our planet has a built-in climate control

We also see Medea in the present, as the Earth undergoes its Sixth Mass Extinction, this one caused in large part by human activity. It's why we see billions of Alaskan snow crabs suddenly disappearing or thousands of other examples of ecosystem collapse. It's why climate change is so threatening to our continued way of life and why humanity may even join the dinosaurs in the dustbin of natural history.

"Why I started thinking about Medea [is that] I really disliked the Gaia hypothesis. Gaia is not even a theory to me, it's just New Age nonsense."

"This name thus seems appropriate for an interpretation of Earth life, which collectively has shown itself through many past episodes in deep time to the recent past, as well as in current behavior, to be inherently selfish and ultimately biocidal," Ward wrote in his 2009 book, "The Medea Hypothesis." "A result of this bad mothering, I propose, will be a shortening of the time that life will exist on our planet. Life will do this to itself by unconsciously changing environmental conditions to a point where there can no longer be plant life or, ultimately, any kind of life."

The Medea Hypothesis might be epitomized by the story of photosynthetic life on Earth. As Ward explained in our interview, plant life on Earth has a repeated tendency to evolve in a way that it removes carbon dioxide from the atmosphere. Reducing the amount of carbon dioxide in the atmosphere then freezes the entire planet, killing the majority of life that depends on Earth being, well, not frozen. This has happened many times in the fossil record.

Salon spoke with Ward about the basis for this theory and what it means for life on Earth — but also the implications for finding life on other planets, including Mars.

This interview has been condensed and lightly edited for clarity.

What got you interested in extinction events?


Peter Ward: What really struck me and why I started thinking about Medea, is I really disliked the Gaia hypothesis. Gaia is not even a theory to me, it's just New Age nonsense. So much good came out of it. Lovelock was no fool. But this idea has been bastardized to the point of thinking that life knows that we humans are putzes and will clean up our mess.

One of the really driving definitions of life is that, given a chance, any species will do anything it can to have all the resources. There's no altruism in nature. Take everything you can, reproduce to the point that you control everything. This is what humans have done. Other species have tried it in the past, they've just never had the ability technologically. But where does that drive come from? I think it's so innate within the structure of DNA and how cells are constructed, this dominance principle. Altruism is nonsense.

When I first encountered this idea of the Gaia hypothesis, I found it very seductive. It's very cute. It's a nice little narrative and there's some evidence for it, I can sort of see that. If you zoom out and you look at the planet, it's like this shelled organism that has a system, just like a microscopic cell. Like, it has a bunch of different components in it, that are all working together, that all evolved independently and then assembled. So maybe you can apply that same sort of lens to the entire planet. 

But in the Medea hypothesis, what are some of the most pointed examples?

Carbon dioxide has to be the most powerful molecule in all biological systems. We're going from 360 parts-per-million CO2 molecules [in the atmosphere] among a million other molecules... all we have to do is go up to 450 or 500 [parts-per-million]... I mean, you're adding another 100 out of a million, and the world goes from benign to completely insane. I mean, completely ends of the world, adding just 100 more [per] million molecules. When you think about the power, that is unbelievable.

CO2 runs the world. And we're on such a knife's edge. Long-term climate stability is partly plate tectonics, but an awful lot of is the carbonate feedback system. When you have CO2, it gets warmer. When it's warmer, chemical weathering increases in rate and therefore it gets colder and colder till now, chemical weathering isn't working as fast. Then you have more volcanoes pumping out CO2. So the balance is up, down, up, down. Three billion years of balance, then along come plants. And photosynthesis kicks in and CO2 is ripped out of the atmosphere, more and more of these plants grow. And then boom, the whole world freezes. Well, the first time plants get roots, boom. Life makes these innovations into very narrowly controlled systems. And it all goes to hell. It's not like life's mean, it's just the bad puppy idea. It f**ks up and knocks things over. Gaia would never do that.

It's embarrassing to admit, but I used to not really believe in climate change, like over a decade ago, until I started looking into the science. And that statistic was one of the things I used to dismiss it. Like there's only 400 million parts per million of CO2 in the atmosphere? How could this have any influence? But it's amazing how even that small change is so impactful.

It's scary. The nice thing about deep time is you really get to relive this stuff. You asked, why am I wrapped up in death? Well, it fascinates and horrifies me. But there's such powerful lessons that you can see. The fossil record doesn't just tell us about the past. It predicts the future.

And usually after a mass extinction, I don't know how long, probably a long time, but there's sometimes an explosion of life. 

The Cambrian Explosion came after a mass extinction, right?

Yeah. But I had this argument with the SETI [Search for Extraterrestrial Life] dudes, back in the day, Seth Shostak and I used to go back and forth. Someone said, "mass extinctions are good things. And in fact, if we hadn't had the critical number we did, we probably wouldn't have the diversity we do." It's equivalent to thinning out the garden to get your other stuff to grow. But I had to point out that following the Permian mass extinction, it took 2 million years to get anything close to what was there before. I personally don't think I want to wait that long. It's a long dead period.

"If there's life on Venus it's up in the clouds. But I've never liked that idea. I think there's a much better chance around Jupiter's moons."

When teaching my undergrad class, I started really looking at how bad ice ages are for planets. I've been to Antarctica four times. What struck me was how little life there was down there.

And if you go all the way back to the snowball Earth — we had one [event] at 2.1 billion years ago and we had one 700 to 600 million, where the planet froze over. You can see it in carbon isotopes. Carbon isotopes are really a meter of the quantity of life on the planet. And every time we have ice ages, the amount of life on this planet drops. Why do we have these cold periods? Why is it the longest Ice Age in Earth history followed [by] the first forests? Plants did it every time.

Every time roots figure out how to go deeper, they break up more rock below them. More minerals with silicate minerals in them get exposed to CO2, they turn into clay, they pull the CO2 out of the atmosphere. Boom, Earth becomes cold. It's life that does it every single time. Every one of the mass extinctions, it's life that kills itself off.

It's like a stupid puppy. It runs amok. It doesn't have evil intentions — that's not possible. This is not some guiding principle. I just have the sense that life is just this clumsy oaf.

What does the Medea hypothesis tell us about the search for life on exoplanets?

There's only a few ways you could make life. Life is probably going to always be affected by natural selection, it's going to have to metabolize, it's gonna have to reproduce. And this is what NASA says. The three parts, if that's how it works, then it is going to be this blunt instrument. Once you start introducing these little chemical factories — that's what a bacterium is, a tiny, little chemical factory — there's only three morphologies.

Bacteria are a little spheres, little rods or little spirals. That's all they can do. Three things. Not a lot of body plans. So when their environment gets f**ked up, they build new chemicals. I can't change this. I can't change myself physically. But I'll change where I'm living chemically. I will make it chemically different. I can make it chemically warmer, chemically colder, I can change the toxins. All I can do is build chemicals. That's profoundly different.

There's probably no life on Mars. But if there's bacteria — if Mars ever had life down deep in the rocks, you're probably gonna find it [there].

Could Mars life have killed itself off in the way that Medea tries to kill itself off here? Of course it could. Same principles are going to apply. Life does some blunderbuss thing on a system that's less forgiving than Earth was. Smaller planet, gas is thinner, you don't have many minerals. You've got a much smaller toolkit to build yourself with. So the margin of error is probably narrower. Surely, blundering life [on Mars] could easily knock itself off.

What about life on Venus or Jupiter's moon Europa?

Well, in the early Earth history, the sun was way less energetic. So Venus wouldn't have been as nasty as it is now. But Venus is the bad case history for too much CO2. It just got hotter and hotter. And then sooner or later, it lost its surface water. And once you do that, you've got a runaway greenhouse [effect].

If there's life on Venus it's up in the clouds. But I've never liked that idea. I think there's a much better chance around Jupiter's moons. The cool thing about Jupiter's moons is that you've got oceans down there. And if you look at Europa, you see all these craters in it. Well, those craters would punch right through. Any asteroid punching through is going to throw a whole bunch of seawater up into space. Those moons are being orbited by frozen water that was blasted out of them. If there was life there, you don't have to go [down] into it. You're gonna find it in orbit around it. So the joke among us is, let's just get a scoop and go fish up the fish frozen in orbit around Europa.


Read more about the history of life on Earth
BIG PHARMA AIMS FOR BIG PROFITS
A tiny biotech's experimental treatment for a silent disease that strikes millions just cleared a key hurdle and the stock is up more than 200%


Sarah Braner
Mon, December 19, 2022 

Madrigal Pharmaceuticals is hoping to succeed where others have failed in treating NASH, a serious liver disease.
Pramote Polyamate/Getty Images

Madrigal Pharmaceuticals reported positive results in its phase 3 trial for a drug to treat NASH.

As a result, its stock has increased by more than 200%.

NASH is a serious liver condition that does not have an FDA-approved treatment.

Madrigal Pharmaceuticals' stock jumped more than 200% on Monday after the biotech released positive results for its drug to treat NASH.


NASH, or nonalcoholic steatohepatitis, is a buildup of fat in the liver that is not caused by alcohol abuse. It can lead to liver scarring and liver failure. Many people don't even know they have it, which is why some people call it a "silent" disease.

Madrigal said in a news release Monday that its drug, called resmetirom, was safe and effective compared to the placebo group. In a trial of more than 950 patients, 26% of patients taking 80mg and 30% of patients taking 100mg of the drug showed that NASH activity like swelling had been reduced. The other main criteria was at least a one-stage improvement in liver damage, and both dosage groups met it with 24% and 26% of patients showing improvement.

The placebo groups showed a 10% and 14% improvement for these two main criteria.

"These unprecedented results from the MAESTRO-NASH clinical trial signal a major turning point for the field," Dr. Stephen Harrison, who led the studies, said in a news release.

Madrigal is aiming to file for accelerated approval for resmetirom in the first half of 2023.
Pharma hasn't found a way to treat NASH yet

The pharma industry has been watching NASH for a while.

Intercept Pharmaceuticals is aiming to be the first to get FDA approval for its NASH drug but a faiure in a late-stage trial in September casts doubt on its ability to do so.

It's not alone in having issues on the path to approval—Gilead Science has also stumbled in recent years. Attempts by pharma giants like Bristol-Myers Squibb have put their efforts to develop treatments for NASH on the shelf.

There is also currently no approved treatment specifically for NASH. It is now the leading cause of liver transplants in patients 65 years old or older.

Read the original article on Business Insider
Religious ‘woke’ capitalism? The problem with conservative arguments against ESG

Opinion by Alan Brownstein, opinion contributor • Yesterday - The Hill

For many business leaders, corporate norms today have expanded beyond the focus on maximizing shareholder value to take into account the broader needs of the community — what is colloquially described as environmental, social and governance (ESG) issues.



Yet ESG is also regularly condemned today, primarily by conservative critics, as wrongheaded and inappropriate manifestations of “Woke” ideology. Republicans in Congress and in state governments plan to challenge private sector companies for their support of ESG policies.

The thrust of the criticism is that for-profit, commercial corporations should base their decisions solely on conventional business concerns — that is, interests that further the purpose of making money for the enterprise. Decisions grounded in environmental values or the betterment of society or programs designed to bring marginalized groups into the company and create a workplace environment where they can thrive are problematic distractions at best. To ESG critics, these are costly, misguided distortions of the profit maximizing free enterprise system.

The focus of these challenges to allegedly “Woke”-influenced decision making are secular values or at least values that are expressed in secular terms.

But what if the ESG concerns are grounded in religious beliefs? Should religious values justify deviations from profit-making goals while secular values, however sincerely motivated, should not?

Assume for a moment that the environmental component (the E of ESG) is grounded upon an asserted religious obligation imposed by God for humanity to care for the earth. As the Pew Research Center reports, “Most U.S. adults — including a solid majority of Christians and large numbers of people who identify with other religious traditions — consider the Earth sacred and believe God gave humans a duty to care for it.” Is it improper for a company to take that faith-based obligation seriously? Must for-profit companies ignore what God requires?

Consider also another religious understanding of ESG. May a company communicate religious messages with the distribution of its goods and services — expressing “Merry Christmas” on cups or prayers on napkins with meals — only if it concludes that doing so will improve the bottom line? Or may these messages be offered for spiritual reasons and for the betterment of society?

The Supreme Court’s analysis in Burwell v. Hobby Lobby Stores (2014) provides some partial guidance on this question. At the time of the lawsuit, Hobby Lobby was a very large, closely held corporation of over 500 stores with 13,000 employees. The owners claimed that a federal regulation requiring them to provide health insurance coverage for medical contraceptives for their employees interfered with their religious beliefs and, accordingly, violated their rights under the Religious Freedom Restoration Act of 1993 (RFRA). The court ruled in favor of Hobby Lobby, a result generally applauded by conservatives. (For the record, I thought the court’s ultimate judgment in Hobby Lobby was correct, although I also thought the majority opinion was badly reasoned and poorly drafted.)

In order to reach its conclusion, the court had to address two basic questions. First, should religious beliefs be recognized as controlling the decisions of a for-profit commercial enterprise and protected as such? The court answered that question in the affirmative. Second, should Hobby Lobby’s status as a corporation undermine its religious liberty claim? Here the court rejected the idea that corporations could not hold and act on religious beliefs and be protected in doing so. Put simply, a for-profit corporation could make decisions based on religious values. The impact of the decision on the profitability of the business was largely beside the point.

To be fair, the fact that Hobby Lobby was a closely held corporation controlled by a family and not a publicly traded corporation made this an easier case for the court to resolve in its favor. And the court acknowledged the practical difficulty of determining the religious commitments of a publicly traded company. But as a conceptual matter, there didn’t seem to be anything inconsistent or inappropriate about a company’s decision makers being influenced or controlled by religious beliefs divorced from profit making concerns.

To be clear here, I am not suggesting that secular beliefs are protected under religious liberty statutes like RFRA. My question is whether we can justify moral and political opposition to ESG grounded in secular values while supporting and even protecting ESG based on religious beliefs.

Without a clear answer to that question, contemporary critics of ESG are vulnerable to the challenge that they accept religiously based ESG, but reject its secular counterpart — not because they think company decisions must focus exclusively on profits, but because certain religious beliefs comport with their political ideology and secular values do not.

Alan Brownstein is a professor of law emeritus at the University of California, Davis School of Law. He has written numerous articles for academic journals and opinion pieces for other media on a range of constitutional law subjects. He is a member of the American Law Institute and served on the Legal Committee of the Northern California American Civil Liberties Union. He received his B.A. degree from Antioch College and earned his J.D. (magna cum laude) from Harvard Law School, where he served as a Case Editor of the Harvard Law Review.
The best wildlife photos of 2022 include a ball of bees, a snake eating a bat, and polar bears raiding an abandoned town

Morgan McFall-Johnsen
Mon, December 19, 2022 

Karine Aigner/Wildlife Photographer of the Year

The London Natural History Museum announced the 2022 winners of its Wildlife Photographer of the Year contest.

The 20 winners were selected from more than 38,000 entries.

Winning photos include a frenzied ball of bees, a dancing sea star, and the brushy mouth of a whale.


As a ball of swarming cactus bees rolled across the hot Texas sand, Karine Aigner trained her camera on the spectacle.

The cactus bees, like most other bees, are endangered by habitat loss, pesticides, and the changing climate. But that didn't stop this cluster of buzzing insects from trying to multiply. All but one of the bees in that ball were male, swarming around a single female. As they clamored for an opportunity to mate, Aigner's camera lens clicked.

The resulting photo, above, won the Grand Title in this year's Wildlife Photographer of the Year competition, which the Natural History Museum in London develops and produces each year.

From more than 38,000 entries, Aigner's photo and 19 other category winners stood out.

"Wings whirring, incoming males home in on the ball of buzzing bees that is rolling straight into the picture. The sense of movement and intensity is shown at bee-level magnification and transforms what are little cactus bees into big competitors for a single female," Roz Kidman Cox, who chaired the panel of judges, said in a statement.

Other winning photos reveal animals, birds, and sea creatures in the throes of life: hunting, being hunted, wandering, dying, dancing for potential mates, and struggling to survive as their world gets smaller.

The Grand Title winner for young photographers captured the contrast inside a whale's mouth


Katanyou Wuttichaitanakorn/Wildlife Photographer of the Year

Katanyou Wuttichaitanakorn, a 16-year-old from Thailand, was on a whale-watching tour when a Bryde's whale surfaced near the boat. Struck by the whale's dark skin, pale pink gums, and brushy mass of baleen teeth, he snapped a picture. It snagged Wuttichaitanakorn's first award in the competition.

Cox called the photo a "dazzling creation."

"The pin-sharp detail of the tiny anchovies is set against an abstraction of color, with the weave of brown baleen hair rimmed by a cascade of water drops," Cox said.
In another winning photo, a snake captured a spooky snack


Fernando Constantino Martínez Belmar/Wildlife Photographer of the Year

In the Cave of the Hanging Snakes, in Quintana Roo, Mexico, Fernando Constantino Martínez Belmar waited in the dark as a Yucatán rat snake poked its head from the rock ceiling. Just like every night, as thousands of bats swarmed out of the cave, the resident snakes waited for just the right opportunity to lunge from their hiding places and snatch a meal.

Using a red light that would be less disruptive in the dark, Martínez Belmar captured the hunt in the split moment before this snake retreated with its prize.

A snow leopard pursued its own, much bigger, prey


Anand Nambiar/Wildlife Photographer of the Year

Across a ravine in the Himalayas, Anand Nambiar watched this leopard maneuver uphill from a herd of ibex, then charge them toward a steep cliff.

Snow leopards are at risk of extinction due to hunting, climate change, and mining that destroys their habitat.

A vulnerable spectacled bear surveyed its disappearing territory


Daniel Mideros/Wildlife Photographer of the Year

Spectacled bears are the only bear species native to South America, and their numbers are dwindling. The disappearance and fragmentation of their habitat has culled them to just a few thousand.

Photographer Daniel Mideros captured one of those bears with a camera he set up on a wildlife corridor, which bridges fragments of habitat between human settlements in Quito, Ecuador.

A beloved mountain gorilla died in her caretaker's arms

Brent Stirton/Wildlife Photographer of the Year

Ndakasi was rescued at two months old after her troop of gorillas was massacred. Photographer Brent Stirton was there to capture her rescue, and returned 13 years later to capture her death, as she laid in the arms of her lifelong caretaker, Andre Bauma, at Virunga National Park in the Democratic Republic of the Congo.

"I loved her like a child," Bauma told the BBC after her death in 2021. "Her cheerful personality brought a smile to my face every time I interacted with her."

Polar bears raided a long-abandoned town

Dmitry Kokh/Wildlife Photographer of the Year

The island of Kolyuchin, in the Siberian Chukchi Sea, lost its human inhabitants long ago. The abandoned settlements there have a new population now: wandering polar bears.

Dmitry Kokh was aboard a yacht, sheltering from a storm, when he spotted the bears moving in and out of buildings on the distant island. He flew a drone out to photograph them.

One small bird listened to the earth...

Nick Kanakis/Wildlife Photographer of the Year

This young grey-breasted wood wren was foraging when photographer Nick Kanakis happened by. The ground-dwelling bird hopped through the leaf litter in Colombia's Tatamá National Park, listening to the ground for the faint squirms of small insects — lunch for the wren.

...while a showy bird puffed out its chest feathers

José Juan Hernández Martinez/Wildlife Photographer of the Year

The Canary Islands houbara does a frantic courting dance. From a spot he dug out, José Juan Hernández Martinez watched the whole thing. The houbara raises the plumes on the front of its neck, throws its head back, sprints forward, circles back, and pauses a moment before starting over again. This photo shows its full puffy glory during that brief pause.

A sea star performed its own eerie mating dance

Tony Wu/Wildlife Photographer of the Year

Birds may have to impress their mates, but sea stars only have to spawn. Still, to set up their spawns for success, they must dance. Rising, swaying, pulsing, and undulating may help release the eggs and sperm, or send them into currents of water so they mix and fertilize. As clouds of sea-star sperm and eggs filled the water, photographer Tony Wu captured this otherwordly invertebrate in the throes of its dance.

Editor's note: This story was first published on October 11, 2022.