Start Up No.1860: Electricity traders get nervous, are half of bitcoin trades fake?, meet Biden’s social media maven, and more

Consider carefully – would it be legal to refuse to hire someone based on their star sign? CC-licensed photo by Numerology Sign on Flickr.

You can sign up to receive each day’s Start Up post by email. You’ll need to click a confirmation link, so no spam.

A selection of 9 links for you. Even on your holidays. I’m @charlesarthur on Twitter. Observations and links welcome.

Listening to European electricity traders is very, very scary • Bloomberg via The Washington Post

Javier Blas:


Every week, the people who trade electricity in the UK get to quiz the managers of the National Grid for an hour. The conference call, which anyone can monitor, offers an insight into what the men and women on the front line of the power market are worried about. Listening to them is getting scarier by the week — and suggests keeping the lights on this winter will be a lot more challenging than European governments are admitting.

Prices are worrying enough. British households were told on Friday that their power and gas bills will increase from Oct. 1 by 80%. The so-called energy price cap was set at £3,549 ($4,189) per year, up from £1,971 over the past six months and £1,277 during last winter.

But the industry’s teleconference suggests the problem is broader than just rising costs. Increasingly, the words “emergency” and “shortages” are being used, with participants focusing on when, rather than if, a crisis will hit. Imagine being able to overhear conversations between Wall Street executives and the Federal Reserve as the global financial crisis unfolded in 2008.

Here’s a question from last week’s session: “Are you war-gaming possible options for if/when cross-border trading collapses under security of supply pressures this winter?” And another: “Can we have a session where we talk through the emergency arrangements?” Another participant said that the forecast for demand-and-supply electricity balance showed “how bad the winter could be for anyone who can do the maths.” The same caller was blunt about the grid’s own predictions: “I don’t think you believe what you’ve written, and nobody else does.”

One intervention was particularly revealing. “Based on where winter ‘22 products are trading, where does this position yourself with respect to securing power over the winter?” asked one participant. The background? In the forward market, UK power for December 2022 is fast approaching £1,000 per megawatt hour, up 50% from current prices. The implication? Power shortages.


Going back to the 1970s, in an unfortunate hurry.
unique link to this extract

Closure of coal power station set to be delayed to prevent UK blackouts • The Guardian

Alex Lawson:


[German owner] Uniper had been due to decommission one of its 500-megawatt units at the Nottinghamshire plant at the end of September, two years before closing the remaining three units at the site.

Under the deal [first sought in May], the National Grid is expected to pay the company a fee to delay the decommissioning so all three units can be called on if needed. Uniper will also be compensated for costs incurred, including coal purchases, with any additional charges eventually being fed through to consumers’ energy bills.

The UK government has committed to ending the use of coal power in Great Britain by October 2024, a year earlier than originally planned. But that target is now at risk as ministers and power operators race to ensure security of supply.

Deals with Drax and EDF to extend the life of two units each from October to the end of March have already been agreed.

Drax, which operates a power plant in Yorkshire, said it had agreed to source up to 400,000 tonnes of additional coal, which with current stocks is enough to produce 1 terawatt of electricity. The plant will only operate when instructed to do so by National Grid.


Upfront cost of the deals: £220m-£420m, depending how much coal (whose price has predictably soared) is needed. It’s a contingency, but a reminder once more of the penalty we pay for inaction in the past. Knock the coal-fired stations down, cover the space with solar panels (or leave them up and ditto). After all, they’re already in the right place for a grid connection.
unique link to this extract

More than half of all bitcoin trades are fake • Forbes

Javier Paz:


As part of Forbes research into the crypto ecosystem using 2021 data, we ranked the 60 best exchanges in March. More recently we conducted a deeper-dive into the bitcoin trading markets to answer a few pressing questions:

Where is bitcoin traded? How much bitcoin gets traded every day? How is bitcoin traded? Our study evaluated 157 crypto exchanges across the world. Here are our main findings:

• More than half of all reported trading volume is likely to be fake or non-economic. Forbes estimates the global daily bitcoin volume for the industry was $128bn on June 14. That is 51% less than the $262bn one would get by taking the sum of self-reported volume from multiple sources.
• Tether, the world’s largest stablecoin, continues to be a dominant player in the crypto trading economy, especially when it comes to trades against bitcoin. Its current market capitalization is $68bn, despite questions about its reserves.

In terms of how much bitcoin activity takes place at these firms, 21 crypto exchanges generate $1bn or more in daily trading activity, while the next 33 exchanges had volume between $200m and $999m across all contract types, spot, futures and perpetuals.…
• The biggest problem areas regarding fake volume are firms that tout big volume but operate with little or no regulatory oversight that would make their figures more credible, notably Binance, MEXC Global and Bybit. Altogether, the lesser regulated exchanges in our study account for approximately $89bn of the true volume (they claim $217bn).
• The creation of new trading assets and products such as stablecoins and perpetual futures adds complications for national authorities seeking to regulate crypto markets. Major US exchanges hardly utilize these instruments or contracts in any of their trading. However, offshore exchanges make significant use of them as ways to synthetically create US dollar liquidity on their platforms (they cannot get US bank accounts).
• In the Western world and particularly in the US, it is tempting to think of bitcoin only trading against either the US dollar or the euro and British pound. But some of the largest trading pair activity occurs against fiat currencies like the Japanese yen and Korean won and against major stablecoins like Binance US dollar and the USD coin.
• 573 million people visit crypto exchange websites on a monthly basis.


So the fake trading is probably “wash trading” – basically passing the asset from one hand to the other and back again. Surprising if it’s only half fake, to be honest.
unique link to this extract

Megan Coyne, the voice of New Jersey, is headed to the White House • New Jersey Globe

David Wildstein, at the beginning of August:


Just five years after interning on Phil Murphy’s 2017 gubernatorial campaign, Livingston native Megan Coyne is on her way to the White House.

Coyne, one of the architects of New Jersey’s hugely successful Twitter account with an attitude departed last week as Murphy’s social media director to join the Biden administration.

“It’s an absolute dream come true to be joining the Office of Digital Strategy as Deputy Director of Platforms,” Coyne said on Twitter on Monday.  “So excited for the journey ahead.”

Coyne and her boss at the time, Pearl Gabel, brought life and a quintessential New Jersey manner to a once dull state-run Twitter account that began to take off in 2019. “Who lets New Jersey have a Twitter?” tweeted someone with 88 followers. The reply – “Your mom” – had nearly a half-million likes and 85,000 retweets.

More than 439,000 followers watch the wit and sarcasm of New Jersey’s official Twitter account every day, which has garnered national attention.

“Megan Coyne has been an incredibly valuable member of our team, and her humour and wit will be greatly missed in our office,” said Murphy.  “Her passion for our state—and fierce defense of Central Jersey—is unparalleled and as the person behind @NJGov, Megan’s voice has become synonymous with New Jersey.  I wish her the best at the White House.”

As New Jersey’s social media tone setter, Coyne has played nearly every conceivable New Jersey card: the Sopranos, Springsteen and Bon Jovi.  She has picked fights with other states, especially in defense of New Jersey’s pizza industry, and has treated the Taylor Ham vs. Pork Roll war fairly, even though she knows the real name is Taylor Ham.


That was the beginning of August. Coyne graduated (with a BA in political science) in 2019, so is in her mid-20s. She seems to have been the brains behind the excoriating tweet thread from the White House last week which picked out Republicans complaining about student loan forgiveness and citing PPP loans *they* had taken that had been forgiven. One to watch, especially as the November midterm elections approach.
unique link to this extract

SwitchBot Lock review: a smart lock with seven ways to unlock your door • The Verge

Jennifer Pattison Tuohy:


heThe $99 SwitchBot Lock is the first smart door lock I’ve tested that doesn’t replace any part of your existing lock. Instead, it attaches to the back of your door over the top of the thumb turn. This removes a major pain point of smart locks: an involved installation. But the SwitchBot Lock is really odd looking — my husband literally stopped in his tracks and said, “What is that thing?” I had a similar reaction when I first saw it and was wholly unconvinced this large piece of black plastic would have the power to unlock my deadbolt.

I was surprised to discover that the SwitchBot Lock moves that thumb turn just as well as I can, and it stayed firmly put during my two weeks of testing, despite being attached solely by double-sided sticky tape. (No word yet on long-term durability, but it looks promising so far).

The downsides are that it’s not very smart and it’s missing a few key features (haha). You also need around $70 worth of accessories to add smart home control and a keypad. This puts it closer in price to more elegant-looking solutions, such as the $230 August Wi-Fi Smart Lock, which needs a bit more work to install but doesn’t leave you with a honking great piece of plastic on your door.

The SwitchBot Lock is a retrofit Bluetooth-powered smart door lock that can lock and unlock your door using the SwitchBot app on a smartphone or Apple Watch. (It’s not Home Key compatible). It attaches to your door using 3M VHB tape and uses a small plastic grabber to hold on to and turn the lock’s thumb turn.

That grabber can turn anything. Videos in Amazon reviews show it even turning a key, making this an excellent solution for people with nontraditional door locks and multipoint locks who can’t get any other smart lock to work (see a list here). It’s cleverly engineered with shifting base plates that prevent the lock from twisting itself off while turning the lock.


Nice idea for retrofitting (though wouldn’t it need screwing in for really tricky locks?). Doesn’t seem to have reached the UK yet, though Switchbot does have lots of things for remotely opening and closing curtains.
unique link to this extract

Truth Social faces financial peril as worry about Trump’s future grows • The Washington Post

Drew Harwell:


Former president Donald Trump’s Truth Social website is facing financial challenges as its traffic remains puny and the company that is scheduled to acquire it expresses fear that his legal troubles could lead to a decline in his popularity.

Six months after its high-profile launch, the site — a clone of Twitter, which banned Trump after Jan. 6, 2021 — still has no guaranteed source of revenue and a questionable path to growth, according to Securities and Exchange Commission filings from Digital World Acquisition, the company planning to take Trump’s start-up, the Trump Media & Technology Group, public.

The company warned this week that its business could be damaged if Trump “becomes less popular or there are further controversies that damage his credibility.” The company has seen its stock price plunge nearly 75% since its March peak and reported in a filing last week that it had lost $6.5m in the first half of the year.

…There are signs that the company’s financial base has begun to erode. The Trump company stopped paying RightForge, a conservative web-hosting service, in March and now owes it more than $1m, according to Fox Business, which first reported the dispute.

The company also has struggled with some basics of corporate operation. The US Patent and Trademark Office this month denied its application to trademark “Truth Social,” citing the “likelihood of confusion” to other similarly named companies, including an app, “VERO — True Social,” first released in 2015.


The alternative web headline for this story is “Trump’s Truth Social isn’t paying its bills”. Next: remarkable news about the toilet habits of bears.
unique link to this extract

San Francisco police and car thefts: what they can and can’t do to help you • San Francisco Chronicle

Megan Cassidy had her car stolen while observing a court case in San Francisco:


In recent months, I’ve spoken to many theft victims who were able to pinpoint the location of their luggage, bicycles and other stolen goods.

While this technology has been around for years, police say its spread — particularly Apple’s introduction of the AirTag last year to compete with products like the Tile tracker and the Galaxy SmartTag — has prompted a boom in calls for help like mine.

As the Washington Post’s Heather Kelly wrote in an article in October, after tracking down her stolen Honda Civic in San Francisco, Apple’s marketing for the AirTag focuses on misplaced items and makes “no mention of crime, theft or stealing in any of the ads, webpages or support documents. But in reality, the company has built a network that is ideal for that exact use case.”

Recent stories have documented similar recoveries in Memphis, Atlanta and Seaford Rise, a suburb of Adelaide in Australia.

In San Francisco, a city rife with gadget-lovers and plagued by high property crime, the technology would seem to be a game changer. But in reality, situations like my stolen Subaru can often be mired in unforeseen complications.

The response by police has at times been thwarted by legal constraints — for example, an officer generally can’t enter a home just because the Find My iPhone app says your cellphone is inside — and at other times by what victims say feels like apathy.

Police officials say the reality is that a stolen phone, bike or even car is not as high a priority as a violent crime, so cops don’t always have time to get involved and stay involved.

The result can be maddening for victims armed with case-cracking evidence. And while police say they always advise these victims against following their valuables into potentially dangerous situations, many people told me they felt they had no choice but to go cowboy.


Seems like frustration with the police over property crimes is a common thread between the west coast of the US and all across the UK. Too few police, and an abundance of caution in the US where everyone might be armed and/or violent.
unique link to this extract

Rocket ships and tractors • Benedict Evans

Evans, on how revenue isn’t necessarily a necessity early on:


If you are acquiring tens or hundreds of millions of users with a new kind of service, and they are attributing value and attention to you, and the users, attention and value have network effects and hence probably winner-takes-all effects, and if they come with little or no marginal cost, then the revenue can and probably should come later. It is probably more important to focus on building the value than making money from the value – revenue is a feature, and you should build it later. Indeed, one of the ways NewsCorp killed MySpace was by trying to make money too early. Such companies spend much more time looking at MAU/DAU [monthly, daily average users] than OFCF [operating free cash flow].

In other words, if you’re on a rocket ship, and it’s going up very fast, don’t argue about the thrust-to-weight ratio. The thrust-to-weight ratio is ‘lots’. Your aim is to keep it pointed roughly upwards and make sure you don’t blow up – you can worry about the revenue model once you get into orbit.

However, there are other companies that are not rocket ships, but instead look more like tractors towing a heavy set of equipment across a muddy field. For these companies, Mr Micawber is much more relevant than Eric Schmidt. For a tractor, success comes down to the gearing ratios – you have 10 or 20 or 30 operating metrics, all interlocking, and their end result is the difference between £19.99 and happiness and £20.01 and misery. If Facebook or Snap were rocket ships, Uber or Instacart are tractors – it’s all about the ratios. For these kinds of companies, you need to have a pretty good idea of the unit economics before you start. 

…People really did think that Facebook would never make money, and they also looked at Wework and thought that arbitraging long-term rents against short-term rents could have high margins. WeWork could, theoretically, be a sustainable business, but it was never a rocket ship. And to stretch the analogy, if you put hydrogen peroxide into a tractor’s fuel tank, the results will be entertaining, but only from a safe distance.

This is also another way to look at the recurring question ‘is that a tech company?’, which can also mean ‘is that a software company?’ or, really, ‘does that have the scope for a 50x return?’ Software companies tend to be high gross margin companies – in the 1980s they sold you a couple of pieces of plastic in a cardboard box for $500, which is one reason Bill Gates became the richest man in the world. Pure software companies can have very high leverage on success.


unique link to this extract

Capricorns need not apply: is it legal to pick a roommate by astrological sign? • The Guardian

Kari Paul:


Is choosing a roommate based on their astrological sign simply a preference, or illegal discrimination? It may depend on where you live.

This week, a post sharing the response to a housing inquiry went viral when the applicant was turned down for their zodiac sign of Capricorn.

“Our main goal is to keep things egalitarian, without anyone being ‘in charge’ or domming the household,” the original poster said. Capricorns are known for being “know-it-alls”, “unforgiving” and condescending as well as good managers, disciplined and self-controlled, according to online astrology resources. “I love capricorns, but I don’t think I could live with one,” the post said.

People often share preferences for certain astrological signs, swearing to never date another Gemini (as pop star Lizzo did on her most recent album). As interest in astrology grows and apps to look up the signs of potential co-workers, partners and housemates become more mainstream, some have speculated that rejecting someone based on their star sign is a form of discrimination.

This argument is legally tenuous at the federal level, said David Levine, a professor who teaches civil procedure law at the University of California Hastings College of Law.

“In order for this to be legally considered discrimination, you have to fall within a protected category,” he said. “Otherwise, you can choose to create a housing contract for any reason you want.”


There’s a rumour that I can’t track down that a famous female singing star recently refused to hire various backing dancers on the basis of their star sign. If it’s not a protected characteristic, though, I guess we could start seeing this in job interviews as a way to winnow applications?
unique link to this extract

• 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?

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

Errata, corrigenda and ai no corrida: none notified

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.