Senators introduce bipartisan bill to regulate crypto assets

Politicians are quickly seizing on US government efforts to study and regulate crypto. Reutersreports Senators Kirsten Gillibrand (D-NY) and Cynthia Lummis (R-WY) have introduced a bill, the Responsible Financial Innovation Act, that would forge a “complete regulatory framework” for cryptocurrency and other digital assets. The measure is meant to protect consumers and fold crypto into existing laws without restricting technical progress.

RIFA would set clearer definitions, such as establishing which assets are commodities or securities. It would also create requirements for stablecoins (cryptocurrencies pegged to another asset, such as conventional money) to minimize risks and enable speeder payments. The Commodity Futures Trading Commission (CFTC) would have the power to regulate digital spot markets, while providers would be subject to disclosure requirements. There would be a “workable” tax structure that would let you buy products with cryptocurrency without having to account for and report income.

The act would also prompt the government to further research digital assets. It would create a “sandbox” where federal and state regulators could work together on experimental launches of financial technology. The CFTC and Securities Exchange Commission would have to develop both security guidance and a self-regulatory organization. Other government agencies and offices would be tasked with studying energy consumption, the benefits (and dangers) of investing retirement savings in crypto and the security concerns around China’s official digital currency.

The bipartisan nature of the bill could increase its chances of surviving a Senate vote. Reuters also points out that the CFTC is considered friendlier to crypto assets than the SEC, That’s potentially useful for winning over regulation-averse politicians worried the SEC might limit crypto’s growth.

A House equivalent has yet to exist, and it’s unlikely that RIFA would reach President Biden’s desk before the current session of Congress ends. It’s likewise unclear just which digital assets are covered, and whether or not NFTs might be affected. We’ve asked for more details. The bill nonetheless represents the strongest effort yet to regulate crypto, and might just serve as a blueprint for future efforts to control and legitimize the blockchain in the US.

New York passes a bill to limit bitcoin mining

New York lawmakers have passed a bill that would temporarily ban new bitcoin mining operations. Early on Friday, state senators voted 36-27 to pass the legislation. It’s now bound for the desk of Governor Kathy Hochul, who will sign it into law or veto the bill. The law would come into effect immediately after it’s signed.

An attempt to enact similar legislation last year hit a wall when the New York State Senate passed it but Assembly members did not. The latest bill passed the Assembly in April.

The legislation seeks to establish a two-year moratorium on licenses for cryptocurrency mining operations that use power-hungry proof-of-work authentication methods for validating blockchain transactions. Right now, bitcoin and ethereum (the two largest cryptocurrencies) fall under that category, though the latter is shifting to a different setup.

The moratorium only covers mining operations that run on carbon-based power sources. Any that harness entirely renewable energy sources or an alternative to proof of work that requires less power won’t be affected. Existing operations and those already going through a permit renewal process won’t be impacted either.

While the moratorium is in place, New York will carry out a study into the environmental impact of proof-of-work authentication methods, per the bill. As CNBC notes, New York has ambitious climate goals that require the state’s greenhouse gas emissions to be reduced by 85 percent by 2050 under the Climate Leadership and Community Protection Act.

New York became a hotbed for crypto mining operations in part due to its plentiful hydroelectricity, low electricity prices and cooler climate than other areas of the US (which means less energy is needed to cool mining hardware). 

Some mining companies have threatened to leave New York due to regulatory uncertainty and set up shop in more crypto-friendly states. Even so, crypto proponents have suggested that, given New York’s status as a legislative leader, other states could follow suit with similar regulations. 

Meanwhile, the Biden administration is working on a policy regarding bitcoin mining. The White House is looking into the impact of such technology on greenhouse gas emissions.

China’s military scientists call for development of anti-Starlink measures

China must develop capabilities to disable and maybe even destroy Starlink internet satellites, the country’s military researchers said in a paper published by the Chinese journal Modern Defense Technology. The authors highlighted the possibility of Starlink being used for military purposes that could aid other countries and threaten China’s national security. According to South China Morning Post, the scientists are calling for the development of anti-satellite capabilities, including both hard and soft kill methods. The former is used to physically destroy satellites, such as the use of missiles, while a soft kill method targets a satellite’s software and operating system. 

In addition, the researchers are suggesting the development of a surveillance system with the ability to track each and every Starlink satellite. That would address one of their concerns, which is the possibility of launching military payloads along with a bunch of satellites for the constellation. David Cowhig’s Translation Blog posted an English version of the paper, along with another article from state-sponsored website China Military Online that warned about the dangers of the satellite internet service. 

“While Starlink claims to be a civilian program that provides high-speed internet services, it has a strong military background,” it said. Its launch sites are built within military bases, it continued, and SpaceX previously received funds from the US Air Force to study how Starlink satellites can connect to military aircraft under encryption. The Chinese scientists warned Starlink could boost the communication speeds of fighter jets and drones by over 100 times. 

The author warned:

“When completed, Starlink satellites can be mounted with reconnaissance, navigation and meteorological devices to further enhance the US military’s combat capability in such areas as reconnaissance remote sensing, communications relay, navigation and positioning, attack and collision, and space sheltering.”

Between hard and soft kill, the researchers favor the latter, since physically destroying satellites would produce space debris that could interfere with China’s activities. The country previously filed a complaint with the United Nations about the Tiangong space station’s near-collision with Starlink satellites. Apparently, the station had to perform evasive maneuvers twice in 2021 to minimize the chances of collision. Destroying a few satellites also wouldn’t completely take out the Starlink constellation, seeing as SpaceX has already launched over 2,500 satellites at this point in time. 

Texas’s bizarre social media law suspended by Supreme Court

Texas’s HB20 was put on hold Tuesday by the Supreme Court, five-to-four. As is typical for emergency for emergency requests, the majority did not define its reasoning; Justice Alito wrote a six page dissent joined by fellow conservatives Gorsuch and Thomas, while Kagan, a moderate, wrote she would “would deny the application to vacate stay” without signing onto the dissent.

The bill — which has been tied up in court since it was passed by the state’s Congress and signed into law by Governor Greg Abbott last September — targets “censorship” by online platforms, insofar as conservatives have in recent years been wont to conflate any form of content moderation with censorship. It reframes large social platforms as “common carriers” similar to telecom companies, but uses that logic to restrict the ability of platforms to limit the spread of, ban or demonetize content based on “the viewpoint of the user,” whether or not that view is expressed on the platform. 

Unsurprisingly, the content, users and viewpoints the law’s supporters believe are being unfairly targeted hew rightward: as the Texas Tribunereported last year, Governor Abbott said he believed social platforms were working to “silence conservative ideas [and] religious beliefs.” The aggrievement of the interested parties and their desired outcomes weren’t lost on Judge Robert Pitman of West Texas’s District Court, who wrote that “the record in this case confirms that the Legislature intended to target large social media platforms perceived as being biased against conservative views.” 

An emergency application to the Supreme Court to suspend HB20 was filed earlier this month by two tech industry groups — NetChoice and the Computer & Communications Industry Association (CCIA) — after a Fifth Circuit court had lifted an injunction on the law, doing so in a startling 2-1 decision for which no explanation was provided. Netchoice’s members include Airbnb, TikTok, Amazon and Lyft among many other; Apple, Google, eBay, Meta and others count themselves among those associated with CCIA. Counsel for NetChoice at the time told Protocol that the Texas law was “unconstitutional” and would compel “online platforms to host and promote foreign propaganda, pornography, pro-Nazi speech, and spam.”

These same concerns were given new urgency after the Buffalo, New York shooting, in which a gunman with white supremacist beliefs killed 10 people and injured three others in a majority-black neighborhood while live-streaming the carnage. Social media companies worked to remove copies of the footage from their services. Even as they did so, the question remained unsettled as to whether those removals would result in Texas dragging these platforms into court. Confusion as to the law’s application was not limited to interested observers, either: in a Twitter exchange with Techdirt’s Mike Masnick, the sponsor of the bill seemed unsure on how such situations would play out. 

A related law in Florida, using a similar common carrier approach, had most of its major provisions deemed unconstitutional by the 11th Circuit Court of Appeals earlier this month. The question of constitutionality for HB20 will continue to move forward in the Fifth Circuit Court. 

Hitting the Books: What the ‘Work from Home’ revolution means for those who can’t

The COVID-19 pandemic changed how we live, how we work, how we get from where we live to where we work or even if we have to leave where we live to get to where we work. But the number of workers that have had their commutes shortened from 45 minutes t…

Senators ask Apple and Google to prohibit data collection that targets abortion seekers

A group of US senators led by Ed Markey of Massachusetts is calling on Apple and Google to implement new app store policies that prohibit developers from collecting data that would threaten women seeking abortions. In separate letters sent to the CEOs …

Lawmakers ask Google to stop collecting location data before reversal of abortion rights

Senator Ron Wyden and 41 other Democratic lawmakers are urging Google to stop collecting and keeping location data that could be used against people who’ve had or are seeking abortions. In a letter (PDF) to Alphabet CEO Sundar Pichai, the lawmakers referenced the Supreme Court draft obtained by Politico in which SCOTUS justices have voted to reverse Roe v. Wade. The landmark case protected the federal rights to abortion across the country, and states with trigger laws will immediately criminalize abortion if it truly gets overturned. 

“[W]e are concerned that, in a world in which abortion could be made illegal, Google’s current practice of collecting and retaining extensive records of cell phone location data will allow it to become a tool for far-right extremists looking to crack down on people seeking reproductive health care,” the lawmakers wrote. Their issue mostly lies with how Google designed Android so that it also has to receive location data if a third-party app asks users for access to their location information. On iOS, Google can only collect information data while people are using Google Maps. 

As Google reveals in its transparency reports, it routinely gets court orders, subpoenas and search warrants from law enforcement agencies looking to get their hands on user information. In the first half of 2021, for instance, the tech giant received 50,907 requests for disclosure of user information involving 115,594 accounts. A total of 82 percent of those requests resulted in the disclosure of some information. 

In their letter, the lawmakers pointed out how a quarter of the court orders Google gets is for “geofence” data, which can show information on people near a particular location at a given time. They means it could be used to identify people who visit reproductive health clinics and other places that help people seek access to abortions.

The signees praised Google for being one of the first companies to require a warrant before disclosing user data, but they said it’s not enough. They compared Google to Apple, saying the latter shows that it’s “not necessary for smartphone companies to retain invasive tracking databases of their customers’ locations.” By continuing to collect location data, the lawmakers say Google is creating a digital divide, since those who can afford iPhones have greater protection against government surveillance. 

They closed the letter with this plea:

“[W]e urge you to promptly reform your data collection and retention practices, so that Google no longer collects unnecessary customer location data nor retains any non-aggregate location data about individual customers, whether in identifiable or anonymized form. Google cannot allow its online advertising-focused digital infrastructure to be weaponized against women.”

Oracle CEO Larry Ellison joined call about contesting Trump’s election loss

Oracle CEO Larry Ellison was involved in a call where a number of influential GOP figures—including Senator Lindsay Graham (R-SC), Fox News anchor Sean Hannity and Trump attorney Jay Sekulow — brainstormed ways to contest the 2020 presidential election, reported the Washington Post. Details of the call which occurred on November 14, 2020 were revealed in new court filings from a lawsuit brought by voting rights organization Fair Fight against True The Vote, a conservative Texas vote monitoring organization that disputes the results of the 2020 presidential election.

“Jim was on a call this evening with Jay Sekulow, Lindsey O. Graham, Sean Hannity, and Larry Ellison,” True the Vote’s founder, Catherine Engelbrecht, wrote to a donor, according to court filings reviewed by the Post. “He explained the work we were doing and they asked for a preliminary report asap, to be used to rally their troops internally, so that’s what I’m working on now.”

Ellison is a high-profile GOP donor and has hosted fundraisers for former president Donald Trump. He has seemingly never expressed doubts about the 2020 election results publicly. While the CEO has donated to both parties over the years as the Palm Desert Sunpoints out, he’s poured a substantial amount of money into the GOP and conservative causes since the 2020 election. His $15 million donation in February to a super PAC associated with Senator Tim Scott (R-SC) is one of the largest of the 2022 election cycle so far.

Ellison’s proximity to Trump has led to concerns that Oracle may have had an unfair advantage in competing for federal contracts during the former administration. Oracle nabbed a lucrative contract in 2020 to aid the Department of Health and Human Services to collect data on doctors who treat COVID-19 patients with hydroxychloroquine, an anti-malaria drug embraced by Trump. It is also nearing a deal with TikTok to store their US data, which Trump approved in 2020.

The FCC has a plan to boost rural broadband download speeds to 100 Mbps

The Federal Communications Commission is aiming to boost rural broadband internet speeds through proposed changes to the Alternative Connect America Cost Model (A-CAM) program. The target is to improve minimum download and upload speeds to 100/20 Mbps in areas served by carriers that receive A-CAM support. The current baseline is 25/3 Mbps.

The A-CAM Broadband Coalition proposed the creation of an Enhanced A-CAM program. The goal is to improve broadband speeds to the levels specified in the Infrastructure Investment and Jobs Act (also known as the $1.2 trillion Bipartisan Infrastructure Law) while avoiding the duplication of efforts across various federal programs.

The notice of proposed rulemaking, which commissioners approved, seeks comment on how the FCC could bolster A-CAM support under an enhanced program and whether the current A-CAM framework even still makes sense. It’s also seeking comment on how to align the Enhanced A-CAM program with Congressional goals and programs at other agencies.

“With additional funding and an expansion of the length of time under which electing carriers would receive support, these carriers would increase deployment speeds up to 100 Mbps download and 20 Mbps upload in some of the most challenging and expensive areas to serve in the country,” Commissioner Geoffrey Starks said in a statement. “[Some] consumers served by A-CAM carriers could see a four-fold, 10-fold or even 20-fold increase in their speeds.”

Last week, using funding allocated by the Bipartisan Infrastructure Law, the Biden administration launched a $45 billion project to bring all Americans online by 2030 and eliminate the digital divide. Officials have also teamed up with internet providers to subsidize the cost of broadband for low-income households.