Start Up No.1697: why the Veep doesn’t Bluetooth, Evergrande’s slide down, might Craig Wright really be Nakamoto?, and more

The story of the bitcoin-filled hard drive in a Welsh landfill is well known; but what has losing it done to its owner? CC-licensed photo by on Flickr.

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A selection of 10 links for you. Nearly Christmas. I’m @charlesarthur on Twitter. Observations and links welcome.

The vice president should not be using Bluetooth headphones • The Verge

Corin Faife:


Yesterday, Politico opened its newsletter with an article on Vice President Kamala Harris’ aversion to using Bluetooth headphones. The VP was “Bluetooth-phobic,” the story claimed, “wary” of her AirPods and cautious with her technology use to an extent former aides described as “a bit paranoid.” Proof could be seen in her televised appearances: wires dangling from her ears in an interview with MSNBC’s Joy Reid or clutched in her hand during the famous “We did it, Joe” call.

But for a high-profile public official, this is a lot more reasonable than you might think. As security researchers were quick to point out, Bluetooth has a number of well-documented vulnerabilities that could be exploited if a bad actor wanted to hack, say, the second most powerful person in the US government.

Some of these attacks come down to the basic mechanics of how the Bluetooth protocol works. With Bluetooth switched on, a phone, laptop or other smart device is constantly broadcasting a signal that can be detected by other devices in range — which provides an unnecessary vector for attack that can easily be eliminated by simply keeping Bluetooth off. Assuming Bluetooth is enabled, a smartphone user generally gets a prompt from any unknown device trying to connect. But in certain cases this can be skirted, as with one exploit that impersonates a trusted Bluetooth device already known to the user in order to connect to the phone, at which point the attacker can request or send data via Bluetooth.


The CVE [notified vulnerabilities database] program lists 459 current and historic vulnerabilities involving Bluetooth. But this also reveals something about modern reporting: easier just to write than check. (Even though there were three people on the story.) And they notice that her husband does use Bluetooth headphones. Could it possibly be because he’s not involved with top secret information?
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Svulstig Last Christmas – Wien 2014 • YouTube


You asked for Swedish opera singers doing a George Michael classic? Happy to help!
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Evergrande’s debt deadline passes as Kaisa adds to China’s property crisis • Reuters

Clare Jim, Scott Murdoch and Andrew Galbraith:


Some offshore bondholders of China Evergrande Group did not receive coupon payments by the end of a 30-day grace period, five people with knowledge of the matter said, pushing the cash-strapped property developer closer to formal default.

Adding to a liquidity crisis in China’s once bubbling property market, smaller peer Kaisa Group Holdings was also unlikely to meet its $400m offshore debt deadline on Tuesday, a source with direct knowledge of the matter said.

Failure by Evergrande to make $82.5m in interest payments due last month would trigger cross-default on its roughly $19bn of international bonds and put the developer at risk of becoming China’s biggest defaulter – a possibility looming over the world’s second-largest economy for months.

Non-payment by Kaisa would push the 6.5% bond of Kaisa, China’s largest holder of offshore debt among developers after Evergrande, into technical default, triggering cross defaults on its offshore bonds totalling nearly $12bn.


Evergrande is like those giant container ships that slip silently through the Suez Canal: when they go off course, things go enormously wrong. This could create quite a domino effect: Evergrande has $300bn of liabilities, and small companies that were reliant on it are getting squashed out of existence. But they’re only in China (so far?) which knows how to contain a problem.
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Rohingya sue Meta/Facebook for $150bn over Myanmar genocide • Gizmodo

Shoshana Wodinksky:


Facebook’s then-head of telecoms, Paul Webster, told one Asia-focused advertising publication in 2015, “In this business if you are not one step ahead, you are actually moving backwards.” That approach still holds true today, with the company continuing to aggressively push into building out telecom partnerships—and hell, literal telecom infrastructure—into these “emerging markets.” And while we don’t know what kind of a cut Facebook’s taking from these deals (the company doesn’t publicize that information), we do know that making “Connectivity” and “Facebook” synonymous is a move that’s translated into a surge of those all-important daily active users across those regions.

And to Facebook, a daily active user is a daily active user, even if those daily active users are being targeted by a genocidal regime. In present-day Myanmar, for example, some analysts say there were roughly 22 million Facebook users region-wide—or roughly 40% of the country’s entire population.

This 40%, just like the rest of Facebook’s users around the globe, get targeted with ads across their various feeds, and when those users interact with those ads in some way, the advertisers payout, and Facebook earns its cut.

In other words, Facebook doesn’t care that close to 25% of Myanmar natives live below the poverty line, or that those poverty figures will almost certainly go up, thanks to the global pandemic and an ongoing military coup. First and foremost, it cares about its advertisers. It always has. And those brands—for whatever ghoulish reason—still see profits to be made in Myanmar. Meanwhile, because Facebook is the internet across that country, those advertisers are stuck cutting checks for a company that’s openly admitted to providing platforms for generals the United Nations says should be tried for genocide.


I linked to another piece about the lawsuit previously, but Wodinsky gets to the heart of things: Facebook liked whatever revenue it got from Myanmar, and didn’t want to waste that on moderators. (Though there’s no way to be sure if “22 million users” is an undercount or overcount, for reasons I explain in my book.)
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• Why do social networks drive us a little mad?
• Why does angry content seem to dominate what we see?
• How much of a role do algorithms play in affecting what we see and do online?
• What can we do about it?
Read Social Warming, my latest book, and find answers – and more.

Half a billion in bitcoin, lost in the dump • The New Yorker

DT Max goes to meet James Howells, who threw away a hard drive that he’d used to mine 8,000 bitcoin back in its early days, which is now somewhere in a Newport landfill and worth around half a billion dollarss:


We went to the dump. It was a bucolic site between an estuary and docks where, many years ago, ships had been loaded with Welsh coal. Derricks stood idle. To get to the landfill, we had to drive past some city offices—“the enemy,” Howells joked. Newport felt rickety: faded signs on small businesses, empty land where factories had once stood. As he drove, Howells mused on why the local officials had refused to allow him to dig up his hoard. He theorized that the dump had not been following environmental regulations, and that unearthing a section of landfill could embarrass the city and make it vulnerable to lawsuits. “Who knows how many dirty baby nappies are buried out there?” he asked.

He drove to the area where he had estimated that his hard drive would likely be. We passed through an open gate and stopped in a paved lot. This large, empty space looked like it was destined for some sort of industrial development by the city, but Howells wanted it to serve first as the command headquarters for his excavation project. We got out. “This plot of land is called B-21,” he said—a propitious number. “How many bitcoins exist? Twenty-one million!”

The sun was shining, an unusual occurrence in Wales in the fall. He pointed at an incline about a hundred feet away: at the top was a tufted hill with gauges inserted in it, to measure gas release. “The total area we want to dig is two hundred and fifty metres by two hundred and fifty metres by fifteen metres deep,” he told me, with excitement. “It’s forty thousand tons of waste. It’s not impossible, is it?”


Howells has tried all sorts, but the local council won’t budge; won’t allow it. (Reasons not provided; surprisingly, Max doesn’t seem to have asked.) What if someone was known to be dead under there?

But it’s also a study in what happens to someone who has riches wafted under their nose, and then put beyond reach. Hard to know how many of us could bear that. And – sidenote – cruel too that the story doesn’t namecheck Alex Hern, who broke the story in The Guardian eight years ago through his assiduous reading of Reddit, followed by some excellent journalism to track down which of the many James Howells out there was the one who binned the wrong hard drive.
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Miami jury rules in favour of Craig Wright, claimed bitcoin inventor • CNBC

MacKenzie Sigalos:


Australian computer scientist Craig Wright implied in a 2016 blog post that he was Satoshi Nakamoto, the pseudonym used by the person or persons who developed bitcoin. Many in the crypto community are skeptical of Wright’s claim, in part because he has not moved any of the early bitcoin presumed to have been mined by Satoshi.

On Monday, Wright prevailed in a Miami civil case that pitted him against the family of his late business partner and computer forensics expert, David Kleiman. At stake was half of the 1.1 million bitcoin mined and held by Satoshi, a cache currently worth around $54bn. The estate also claimed rights to some of the intellectual property behind early blockchain technology.

The prosecution argued that Kleiman was a co-creator of bitcoin, alongside Wright, entitling him to half of Satoshi’s assumed fortune. A federal jury in West Palm Beach sided with Wright and declined to award any of the bitcoin to Kleiman’s estate.

However, Wright was ordered to pay $100m in compensatory damages over a breach in intellectual property rights related to W&K Info Defense Research LLC, a joint venture between the two men. That money will go to W&K directly, rather than to the Kleiman estate.


Complicated: Wright owns half of W&K, though Kleiman’s estate would have a call on the other half. But the jury seems to have decided that Wright is Nakamoto. And Wright said that he would give much of that (humungous!) fortune to charity.

A couple of tricky points: if he proves he’s Nakamoto by moving some of the cache, the value could plummet because he would have control of a giant tranche of bitcoin – he could move the market by selling any amount at any time. And if he doesn’t, where’s he going to find $100m?
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Raising the standard for protecting teens and supporting parents online • Instagram blog

Adam Mosseri is CEO:


At Instagram, we’ve been working for a long time to keep young people safe on the app; as part of that work, today we’re announcing some new tools and features to keep young people even safer on Instagram.

We’ll be taking a stricter approach to what we recommend to teens on the app, we’ll stop people from tagging or mentioning teens that don’t follow them, we’ll be nudging teens towards different topics if they’ve been dwelling on one topic for a long time and we’re launching the Take a Break feature in the US, UK, Ireland, Canada, Australia and New Zealand, which we previously announced.

We’ll also be launching our first tools for parents and guardians early next year to help them get more involved in their teen’s experiences on Instagram. Parents and guardians will be able to see how much time their teens spend on Instagram and set time limits. And we’ll have a new educational hub for parents and guardians.


I suppose you could say that Instagram has been working for a long time to keep young people safe on the app, though it’s not as long as Instagram has been going. Teenagers will be able to notify parents if they report someone (else). The “educational hub”, well, I’m sure that’s going to be as wildly popular as anything labelled “educational” is with children.

Meanwhile, Mosseri goes up in front of Congress on Wednesday (today for most of you), where Frances Haugen’s whistleblower testimony is going to be a key feature.
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Microsoft seizes domains used by “highly sophisticated” hackers in China • Ars Technica

Dan Goodin:


Microsoft said it has seized control of servers that a China-based hacking group was using to compromise targets that align with that country’s geopolitical interests.

The hacking group, which Microsoft has dubbed Nickel, has been in Microsoft’s sights since at least 2016, and the software company has been tracking the now-disrupted intelligence-gathering campaign since 2019. The attacks—against government agencies, think tanks, and human rights organizations in the US and 28 other countries—were “highly sophisticated,” Microsoft said, and used a variety of techniques, including exploiting vulnerabilities in software that targets had yet to patch.

…Microsoft will now “sinkhole” the traffic, meaning it’s diverted away from Nickel’s servers and to Microsoft-operated servers, which can neutralize the threat and obtain intelligence about how the group and its software work.

“Obtaining control of the malicious websites and redirecting traffic from those sites to Microsoft’s secure servers will help us protect existing and future victims while learning more about Nickel’s activities,” Tom Burt, the company’s corporate vice president of customer security and trust, wrote in a blog post. “Our disruption will not prevent Nickel from continuing other hacking activities, but we do believe we have removed a key piece of the infrastructure the group has been relying on for this latest wave of attacks.”

Targeted organizations included those in both the private and public sectors, including diplomatic entities and ministries of foreign affairs in North America, Central America, South America, the Caribbean, Europe, and Africa. Often, there was a correlation between the targets and geopolitical interests in China.

Targeted organizations were located in other countries including Argentina, Barbados, Bosnia and Herzegovina, Brazil, Bulgaria, Chile, Colombia, Croatia, Czech Republic, Dominican Republic, Ecuador, El Salvador, France, Guatemala, Honduras, Hungary, Italy, Jamaica, Mali, Mexico, Montenegro, Panama, Peru, Portugal, Switzerland, Trinidad and Tobago, the United Kingdom, and Venezuela.


That’s a pretty comprehensive list of countries. And imagine chasing a hacking group for six years.
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Art for money’s sake • Forbes

David Birch:


markets can’t operate without clear property rights: before someone can buy a good, it has to be clear who has the right to sell it, and once a buyer comes along, there must be a mechanism to transfer ownership from the seller to the buyer. NFTs solve this problem by providing the mechanism to establish and transfer ownership in a decentralised manner.

This is actually a pretty radical step in the history of stuff and here’s a quick explanation as to why this is the case (from Andreessen Horowitz). It begins by noting that there are two types of tokens: fungible (e.g., interchangeable) and NFTs (e.g., unique). They fill different niches.

Money is fungible, so fungible tokens will be used for digital currencies (this is one of the reasons why Bitcoin, whatever it is, isn’t money) whereas the non-fungible ones will be used to create a wide range of what a16z call “internet-native” business models centred on collectibles, rewards, achievements and, as a16z note, these deliver a sense of identity, status and belonging. And despite the fact that the current NFT market appears to be based on people selling pictures of chimpanzees with sunglasses on to themselves for millions of dollars, there are great many people (eg, me) who think that NFTs are a very serious business indeed.

One reason is because, as Kaczynski and Kominers point out, smart contracts and programmability means that they can deliver utility in both digital spaces and the physical world and this is what has long interested me about them.

A good example of this utility is event ticketing. Some years ago I worked on project for a blockchain provider. They had teams looking at a few different use cases, most of which never went anywhere, but one of the use cases that had substance was ticketing. Event tickets are unique and should not be clone-able or counterfeitable. They should belong to one and only one owner, And they should be able to be transferred between owners. NFTs are the perfect way to implement them (and, indeed, I even attended a concert in which a pilot token ticket system was trialled).


The jumping-off point for this is the work of James Stephen George Boggs, who used to pay for stuff with hand-drawn “dollar bills” that were unique and, hence, not money. Dave (who I’ve now known for decades) always cuts through the noise to the key, useful points.
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Samsung heir launches management shake-up • Financial Times

Song Jung-a:


Samsung Electronics has reshuffled its management for the first time in four years as it steps up its push into non-memory chips and artificial intelligence.

The shake-up comes as Lee Jae-yong, the group’s third-generation heir, has started playing an active management role four months after being released from prison.

Lee, who spent 19 months in jail for bribing former president Park Geun-hye, still faces charges of stock manipulation linked to the 2015 merger of two Samsung units engineered to consolidate his control.

He is expected to meet customers of Samsung’s 5G telecommunications and construction businesses on a trip this week to the Middle East following a high-profile visit to the US last month.

After Lee’s trip, Samsung announced it would build a $17bn chip plant in Texas to help Washington expand US chip production, a national security priority for Joe Biden’s administration.

Lee’s shake-up outlined on Tuesday included merging Samsung’s consumer electronics and mobile divisions to take on competitor Apple, which boasts a fully integrated line of devices. He promoted Han Jong-hee, head of Samsung’s visual display business, to take charge of the new division.

Han, an expert in television research and development, has played a critical role in maintaining Samsung’s leadership in the global TV market for the past 15 years, and helped the group achieve explosive sales growth during the coronavirus pandemic.


“Just spitballing here, but what if we set Succession in the place where they did Squid Game?”
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Errata, corrigenda and ai no corrida: none notified

2 thoughts on “Start Up No.1697: why the Veep doesn’t Bluetooth, Evergrande’s slide down, might Craig Wright really be Nakamoto?, and more

  1. I kept thinking that I wouldn’t give good odds of recovering the bitcoin data on that hard drive, but thinking again, maybe there’s a chance. Since we’re assuming platter-scanning, the drive mechanics itself aren’t relevant. Since the drive was among a bunch of trash, that trash probably acted like packing and shock absorption in order to protect the platter itself from shattering, as it made the trip to the landfill. Once it’s in the landfill, more stuff piled on top of it may not harm it at all, the metal casing is pretty sturdy. Years inside the landfill may not be great in terms of corrosion of the magnetic media, but who knows, the immediate environment down deep in the pile might not be that bad. All in all, given the amount of potential (fiat) money involved, it does seem like recovery would be worth a try if the drive could be found.

    This whole thing has the makings of fantastic movie, where there’s an illegal expedition to find the drive, it’s found, and then people keep betraying and murdering each other over it, since it potentially contains a large fortune. With a kicker at the end, after the trail of dead bodies, that the platter is too corroded to recover any data, so in fact the drive is worthless.

    • Well if a hard drive can survive being burnt up on reentry… I like the film already. A bit like the plot of Neal Stephenson’s Cryptonomicon.

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