Start Up No.1719: Djokovic’s strange ‘biotech’ investment, Covid’s air loss, NFT site drop kills NFTs, crypto miners under fire, and more

Once the darling of the stock market, exercise company Peloton has seen a dramatic drop in demand – and expected profits. CC-licensed photo by Tony Webster on Flickr.

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A selection of 10 links for you. Turning the wheels. I’m @charlesarthur on Twitter. Observations and links welcome.

Peloton to pause production of its Bikes, treadmills as demand wanes • CNBC

Lauren Thomas:


Peloton is temporarily halting production of its connected fitness products as consumer demand wanes and the company looks to control costs, according to internal documents obtained by CNBC.

Peloton plans to pause Bike production for two months, from February to March, the documents show. It already halted production of its more expensive Bike+ in December and will do so until June. It won’t manufacture its Tread treadmill machine for six weeks, beginning next month. And it doesn’t anticipate producing any Tread+ machines in fiscal 2022, according to the documents. Peloton had previously halted Tread+ production after a safety recall last year.

The company said in a confidential presentation dated Jan. 10 that demand for its connected fitness equipment has faced a “significant reduction” around the world due to shoppers’ price sensitivity and amplified competitor activity.

Peloton has essentially guessed wrong about how many people would be buying its products, after so much demand was pulled forward during the coronavirus pandemic. It’s now left with thousands of cycles and treadmills sitting in warehouses or on cargo ships, and it needs to reset its inventory levels.

The planned production halt comes as close to $40bn has been shaved off of Peloton’s market cap over the past year. Its market value hit a high of nearly $50bn last January.


It’s lost eighty percent of its market cap? (Market cap being the market’s guess about the net present value of its total future profits.) But it gets worse:


However, Peloton said, the latest forecast doesn’t take into account any impact to demand the company might see when it begins to charge customers an extra $250 in delivery and setup fees for its Bike, and another $350 for its Tread, beginning at the end of this month.


Benedict Evans suggested it’s another GoPro – madly fashionable for a while, and then just a tiny niche.
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What sort of ‘biotech’ company has Novak Djokovic invested in? • Thread Reader App

Dr Darren Saunders is a biomedical scientist, and he’s taken a closer look at that company Novok Djokovic and his wife have invested in to find a “cure” for Covid:


Here’s the site of Novak’s “biotech” company QuantBioRes. The inclusion of “Quant” (ie quantum) in the name is a massive red flag 🚩🚨

The second red flag is the liberal sprinkling of words like “resonant” and “frequencies” through the word salad on that site. (Let’s just park the false staement that coronaviruses are retroviruses for now).

So, if you haven’t fgured it out yet, Novak’s “biotech company” is working on homeopathy as a cure for COVID.

I’ve read the “discover more” section about their innovatove technology (I highly reccomend against this), here are a few choice quotes… “During this rapid research effort, we will identify the common component of proteins responsible for initial infection for all related RNA viruses and then design a vaccine based on this component and thus create the cure.”

Guys, this isn’t how biochemistry works


Possibly – just possibly – Djokovic is better at tennis than biomedical investment. (Thanks Toby A.)
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Covid loses 90% of ability to infect within 20 minutes in air – study • The Guardian

Linda Geddes:


Coronavirus loses 90% of its ability to infect us within 20 minutes of becoming airborne – with most of the loss occurring within the first five minutes, the world’s first simulations of how the virus survives in exhaled air suggest.

The findings re-emphasise the importance of short-range Covid transmission, with physical distancing and mask-wearing likely to be the most effective means of preventing infection. Ventilation, though still worthwhile, is likely to have a lesser impact.

“People have been focused on poorly ventilated spaces and thinking about airborne transmission over metres or across a room. I’m not saying that doesn’t happen, but I think still the greatest risk of exposure is when you’re close to someone,” said Prof Jonathan Reid, director of the University of Bristol’s Aerosol Research Centre and the study’s lead author.

“When you move further away, not only is the aerosol diluted down, there’s also less infectious virus because the virus has lost infectivity [as a result of time].”

Until now, our assumptions about how long the virus survives in tiny airborne droplets have been based on studies that involved spraying virus into sealed vessels called Goldberg drums, which rotate to keep the droplets airborne. Using this method, US researchers found that infectious virus could still be detected after three hours. Yet such experiments do not accurately replicate what happens when we cough or breathe.


Not peer-reviewed, but makes a lot of sense. And drier air is even more effective at deactivating it. (No mention of washing hands, eh.)
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People can’t see some NFTs on Twitter and crypto wallets after OpenSea goes down • Vice

Lorenzo Franceschi-Bicchierai:


OpenSea, one of the most popular marketplaces for non-fungible tokens or NFTs, is suffering a “database outage,” the company announced on Thursday. As a result, several services which rely on OpenSea’s APIs, including the popular crypto wallet MetaMask, are having trouble displaying NFTs.

“We’re caching that data so their outage doesn’t wipe the wallet,” MetaMask co-founder Dan Finlay told Motherboard in an email. “We store what NFTs the user has in the wallet. OpenSea’s outage means we are currently not auto-detecting new NFTs that are sent to the user’s wallet, although users can always tell the wallet about NFTs they have by entering its address manually.”

In other words, because OpenSea is down, some NFT owners who just bought their tokens may not be able to see their expensive JPEGs even in their crypto wallet. 

“We are experiencing technical issues leading to a site outage. Teams are currently investigating,” the company wrote around 9 a.m. ET. As of this writing, OpenSea published an update saying “a fix has been implemented and we are monitoring the issue. Programmatic access remains disabled.”

Some people are taking advantage of this situation to make the point that the NFT market and the so-called web3 is not as decentralized as its supporters often argue.


Er, yeah. It’s centralised as the Facebook/YouTube/Twitter tri-opoly, for all the denials.
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Georgia’s mountainous cryptocurrency problem • Eurasianet

Giorgi Lomsadze :


Svaneti is best known for its towering, snowy peaks, picturesque stone-hewn hamlets, and strict traditional code of honor. Increasingly, however, it is also known for cryptocurrency production.

Some residents have been taking advantage of a government program providing free electricity to mountain regions, with the aim of keeping the remote communities alive, and using the subsidized power to churn out virtual money in their medieval towers.

Georgia has emerged as an unlikely global cryptocurrency hotspot, with prospectors attracted to the country’s laissez-faire business environment and cheap electricity needed for the power-hungry process of “mining” the virtual money. Svaneti – with its free electricity for households and discounts for businesses – is an especially appealing base for the industry.

While that has allowed some in Svaneti to make a mint in the virtual economy, it has meant that many others in the hardscrabble region suffer from the resulting power outages. The region has no natural gas supply, meaning that electricity (along with wood) is used for heating in winter. Svaneti’s other new economic hope – tourism – suffers particularly from the frequent power outages, which affect hotels, restaurants, and ski lifts.

Svaneti’s cryptocurrency frenzy peaked in 2019, when the power company and police were forced to go door to door to disconnect consumers who had gotten involved in cryptocurrency mining. Energo Pro said it then took offline about five million laris [$1.6 million] worth of mining hardware.

But miners were undeterred, and last year the region’s electricity consumption returned to 2019 levels, the company said. The regional capital of Mestia and nearby towns consume almost four times more power than the seven megawatt hours they are expected to.

Mountain dwellers are not the only Georgians using electricity subsidies for cryptocurrency: monasteries, too, have become unlikely outposts of virtual mining. In a dump last year of security services’ surveillance files, one revelation was the extent to which the clergy had gotten involved in the crypto business.


Keep going…
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EU should ban energy-intensive mode of crypto mining, regulator says • Financial Times

Eva Szalay:


A top EU financial regulator has renewed calls for a bloc-wide “ban” on the main form of bitcoin mining and sounded the alarm over the rising proportion of renewable energy devoted to crypto mining.

Erik Thedéen, vice-chair of the European Securities and Markets Authority, told the Financial Times that bitcoin mining had become a “national issue” for his native country Sweden and warned that cryptocurrencies posed a risk to meeting climate change goals in the Paris agreement.

Thedéen said that European regulators should consider banning a mining method known as “proof of work” and instead nudge the industry towards the less energy-intensive “proof of stake” model to cut down on the sector’s vast power usage.

Bitcoin and ether, the two largest cryptocurrencies by volume, both rely on a proof of work model, requiring all participants on the blockchain digital ledger to verify transactions. Miners, who use sprawling data centres filled with fast computers to solve complex puzzles, are rewarded for recording transactions with newly minted coins.

That requires significantly more energy than the proof of stake model, where the number of parties signing off trades is much smaller.

“The solution is to ban proof of work,” said Thedéen, who is also director-general of Sweden’s Financial Supervisory Authority and chair of sustainable finance for international body Iosco. “Proof of stake has a significantly lower energy profile.”


Keep going…
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Russia proposes ban on use and mining of cryptocurrencies • Reuters

Elena Fabrichnaya and Alexander Marrow:


Russia’s central bank on Thursday proposed banning the use and mining of cryptocurrencies on Russian territory, citing threats to financial stability, citizens’ wellbeing and its monetary policy sovereignty.

The move is the latest in a global cryptocurrency crackdown as governments from Asia to the United States worry that privately operated and highly volatile digital currencies could undermine their control of financial and monetary systems.

Russia has argued for years against cryptocurrencies, saying they could be used in money laundering or to finance terrorism. It eventually gave them legal status in 2020 but banned their use as a means of payment.

In a report published on Thursday, the central bank said speculative demand primarily determined cryptocurrencies’ rapid growth and that they carried characteristics of a financial pyramid, warning of potential bubbles in the market, threatening financial stability and citizens.

The bank proposed preventing financial institutions from carrying out any operations with cryptocurrencies and said mechanisms should be developed to block transactions aimed at buying or selling cryptocurrencies for fiat currencies.


“Mechanisms”. Blocking the IPs of cryptocurrency exchanges, so they’re unreachable in Russia? Have to block all the VPNs too. That’s going to inconvenience the ransomware operators.
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More than half a billion people worldwide subscribe to music •Midia Research

Mark Mulligan:


The global base of music subscribers continues to grow strongly with 523.9 million music subscribers at the end of Q2 2021, which was up by 109.5 million (26.4%) from one year earlier. Crucially, this was faster growth than the prior year. There is a difference between revenue and subscribers – with ARPU [average revenue per user] deflators, such as the rise of multi-user plans and the growth of lower-spending emerging markets – but growth in monetised users represents the foundation stone of the digital service provider (DSP) streaming market. So, accelerating growth at this relatively late stage of the streaming market’s evolution is clearly positive.

Spotify remains the DSP with the highest market share (31%), but this was down from 33% in Q2 2020 and 34% in Q2 2019. With Apple Music being a distant second with 15% market share, and Spotify adding more subscribers in the 12 months leading up to Q2 2021 than any other single DSP, there is no risk of Spotify losing its leading position anytime soon – but the erosion of its share is steady and persistent.

Amazon Music once again out-performed Spotify in terms of growth (25% compared to 20%), but the standout success story among Western DSPs was YouTube Music, for the second successive year. Google was once the laggard of the space, but the launch of YouTube Music has transformed its fortunes, growing by more than 50% in the 12 months leading up to Q2 2021. YouTube Music was the only Western DSP to increase global market share during this the period. YouTube Music particularly resonates among Gen Z and younger Millennials, which should have alarm bells ringing for Spotify, as their core base of Millennial subscribers from the 2010s in the West are now beginning to age.


Ageing Millennials! A new problem. Though Mulligan admits he had thought that by now we’d be up to a billion subscribers. Nothing like.
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Police in this tiny Alabama town suck drivers into legal ‘black hole’ • (Alabama)

John Archibald:


Ramon Perez came to court last month ready to fight the tickets he’d been handed by Brookside police, including one for rolling through a stop sign and another for driving 48 mph in a 40 zone.

He swore he’d seen the cop from a distance and was careful as he braked. “I saw him and we looked eye to eye,” the Chelsea business owner said. “There’s no way I was going to run that stop sign.”

When he got to court Dec. 2, he saw scores of people just like him lining up to stand before Judge Jim Wooten, complaining of penny-ante “crimes” and harassment by officers. He saw so many people trying to park in the grassy field outside the municipal building that police had to direct traffic. He figured there was no point. “I saw the same attitude in every officer and every person,” he said. “That’s why I hesitated to fight it. They were doing the same thing to every person that was there. They own the town.”

Perez, it appears, was right. Months of research and dozens of interviews by found that Brookside’s finances are rocket-fuelled by tickets and aggressive policing. In a two-year period between 2018 and 2020 Brookside revenues from fines and forfeitures soared more than 640% and now make up half the city’s total income. And the police chief has called for more.

The town of [population] 1,253 just north of Birmingham reported just 55 serious crimes to the state in the entire eight year period between 2011 and 2018 – none of them homicide or rape. But in 2018 it began building a police empire, hiring more and more officers to blanket its six miles of roads and mile-and-a-half jurisdiction on Interstate 22.


Also: drives people into debt, which is shown to encourage them into crime.. so policing causes crime.
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Polar bears on Kolyuchin Island, Chukotka, Russia • YouTube

They’re such passive-looking creatures who, of course, could rip you to shreds in moments. Amazing drone footage; stills from it have appeared and made people think they were taken by an excessively brave (or foolish) human photographer. The drone looks imperilled enough. (Via John Naughton.)
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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?
• Did Facebook have any inkling of what was coming in Myanmar in 2016?

Social Warming, my latest book, and find answers – and more.

Errata, corrigenda and ai no corrida: plenty of reaction to the Royal Society’s proposal about leaving “misinformation” on social media, and my comments on it. A couple of responses. First from HW:

It’s difficult.

Vaccines are a good example, from a public policy perspective the messaging needs to be clear, “vaccines work and are safe”.

From a scientific perspective that message would probably be “Vaccines drastically reduce the risk of serious illness and somewhat reduce the risk of transmission. For the overwhelming majority most indications show them to be safe. Past data on other vaccination programs suggests that most problems with vaccines show up in the first three months suggesting that longer term worries about safety should be seen in that perspective”.

In the social media driven world we now inhabit the nuance in the scientific perspective leaves plenty of space for questioning by well meaning and ill meaning types alike.

Of course on top of that you can add the paranoid and conspiracy minded to boot.

And from Wendy G:

Because to have trust in science requires showing your work? Because one year’s scientific consensus (ulcers are caused by stress, continents do not move, silicon implants are safe) may be next year’s misinformation?

Maybe what we need to mandate is confidence intervals.

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