Five Top Tech Takeaways: Apple's Carbon Neutrality Questioned, Fairphone 5 Launches, Binance US's CEO Leaves and a Privacy Nightmare on Wheels

E-Waste: A Smoldering Problem (Pic Link) (Article Link)

"Carbon Neutral" Apple Watch: What Does It Really Mean?

Apple's recent launch of its "carbon neutral" 9th-generation Apple Watch has stirred both interest and skepticism in the tech community. While Apple has certainly made strides in cleaning up its supply chain and investing in renewable energy, experts like climate scientist David Ho question whether any product can genuinely be carbon neutral. The phrase "carbon neutral" is seen by some as misleading when companies use carbon credits to offset their emissions, a practice that has drawn scrutiny from regulators. Apple's "carbon neutral" watch relies heavily on these credits, which are tied to nature-based offset projects that are themselves subject to criticism. As noted in the article:

"Part of the problem is the slipperiness of attempting to tie a carbon credit—an abstract financial instrument—to any particular product in Apple’s armada of product offerings or the wider global economy. The Watch doesn’t have any role in creating those credits. They’re only brought together by an accountant’s sleight of hand."

The company's ambitious goal to have its entire product lineup carbon neutral by 2030 might sound good on paper, but given the complexity of global supply chains and the limitations of current carbon offset systems, it raises the question: how 'neutral' can a consumer product really be? (Source: Wired)

iPhone 15 Launch: Analyzing Apple’s Eco-Friendly Claims Amid New Product Launches

In case you missed it, we examined Apple's annual iPhone launch last week. Amid the spectacle of technology and innovation, Apple's environmental initiatives were in the spotlight. The tech giant unveiled four new iPhone models and two Apple Watches, all with improved features and performance. At the same time, Apple made significant claims about their Environmental, Social, and Governance (ESG) efforts, such as a 95% reduction in transportation emissions and a carbon-neutral Series 9 Apple Watch—a claim that has been questioned, as noted in a previous Wired article. Check out our post where we assess Apple's eco-claims in the context of their past green initiatives. (Source: UWCISA)

Fairphone 5: A More Sustainable and Repairable Smartphone?

The Fairphone 5, released by Dutch smartphone company Fairphone, aims to be a game-changer in the smartphone industry by offering up to 10 years of software support, a first in the industry. It also has built-in eco-sustainability, unlike the competition. The previous model, the Fairphone 4, got an industry-leading iFixit Score of 10 out 10 for its repairability. Designed with longevity, repairability, and eco-human-friendly-sourcing in mind, the phone retails at £619 (€699). It features a 6.46-inch QHD+ OLED screen, a Qualcomm QCM6490 processor, and an array of recycled and sustainable materials. While it may not lead in performance, it offers other unique benefits such as a removable battery, a five-year warranty, and modular spare parts for easy repairs. Fairphone is setting new standards for manufacturing and tech waste reduction, although compromises include a less impressive camera and mid-range performance. (Source: The Guardian, Fairphone)

Driving into the Privacy Abyss: The Dark Side of Modern Cars

Modern cars are becoming more like computers on wheels, boasting advanced tech features that unfortunately come with a price—your privacy. An exhaustive research study into 25 car brands revealed that every brand collects more personal data than necessary, and 84% admit to sharing or selling your data to third parties. Only two brands, available only in Europe, give drivers the right to have their personal data deleted. Surprisingly, car manufacturers perform worse in terms of security and privacy practices compared to other tech products like dating apps or mental health apps. The study also exposes how these companies manipulate "consent," forcing drivers and even passengers to give away their privacy. Given that every brand reviewed was flagged for privacy issues, the situation paints a grim picture for consumer choice and control over personal data. (Source: Mozilla)

Turmoil in Crypto Continues: Binance.US CEO's Departure and the SEC Crackdown

Brian Shroder, CEO of Binance's U.S. arm, has stepped down and will be temporarily succeeded by the firm's Chief Legal Officer, Norman Reed. Amid regulatory scrutiny, the company is also reducing its workforce by approximately one-third. This move follows allegations from the SEC that Binance.US has been operating an illegal trading platform. These organizational changes are part of a larger trend affecting the crypto industry, as U.S. regulatory bodies ramp up enforcement measures. (Source: WSJ)

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a GRC Strategist who is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else. This post was written with the assistance of an AI language model. The model provided suggestions and completions to help me write, but the final content and opinions are my own.

Top Five Tech Takeaways: Llama2 joins the GenAI Fray, XRP Mixed Judgment, Co-pilot Pricing Announced, Tech Reacts to Bill C-18, and Code Interpreter Debuts

Robo Llama Joins the GenAI Battle

Llama2 Joins the GenAI Battle: Meta Offers it Free for Research and Commercial Use

Meta has recently announced the launch of Llama 2, the highly anticipated second generation of their open source large language model. Llama 2 has been released for both research and commercial purposes, free of charge, to promote innovation and development in the field. Microsoft, a longstanding partner of Meta, is deepening its involvement in this project and has become the preferred partner for Llama 2, making it available through Azure. The widespread endorsement from a variety of stakeholders across the technological landscape, academia, and policy, signifies the embracement of Meta's open innovation approach in AI. The model is free for both academic and commercial use - as long you have less than 700 million users. (Source: Meta, The AI Advantage)

Microsoft Unveils AI Copilot: A Pricier Path to Productivity?

Microsoft has unveiled its plans to integrate an AI engine, dubbed Microsoft 365 Copilot, across its productivity suite, with a proposed cost of $30 per user per month. Copilot, comparable to ChatGPT, can execute tasks across various Office applications, from editing Word documents and summarizing Excel data trends, to creating PowerPoint presentations and drafting emails in Outlook. Copilot is set to roll out for 365 E3, E5, Business Standard, and Business Premium customers, though an exact launch date has not been disclosed. Microsoft also plans to include a privacy-centric version of its Bing chatbot that will not store chat history, as an added measure to protect corporate data. (Source: Yahoo)

Bill C-18 Fallout: Tech Giants Google and Meta Block News in Canada

In a strong rebuke to Canada's Bill C-18, which mandates payments from tech giants for news links to support the Canadian news sector, Google and Meta have responded by blocking news links in Canada. Initially, Google had voiced concerns about the approach's uncapped liability and the risky business framework it presented, while Meta had regarded news contribution as highly substitutable. However, the companies' decisions to cut off news links could lead to dramatic consequences: a potential decline in news outlets due to reduced traffic and revenue, decreased reliability of Google's search services, increased reliance on foreign news sources, and a surge in misinformation. (Source: Michael Geist)

Ripple vs SEC: A Mixed Verdict over XRP Sales

In the lawsuit between Ripple and the U.S. Securities and Exchange Commission (SEC), the verdict delivered was a mixed bag. The court ruled that Ripple's sales of its cryptocurrency, XRP, on public exchanges did not constitute offers of securities, hence rejecting part of the SEC's claim. However, the SEC scored a partial victory as the court found Ripple's $728.9 million sales of XRP to institutional investors were unregistered securities sales. Additionally, it was determined that Ripple's executives couldn't argue a lack of "fair notice" that XRP was a security at the trial. (Source: Reuters)

OpenAI's Code Interpreter: Your New Companion for Data Analysis, Visualizations, and More

OpenAI has recently added a new plug-in to ChatGPT Plus called the Code Interpreter, turning the AI into a personal data analyst. This plug-in utilizes Python to generate responses and allows users to both upload and download files. Here is Business Insider's summary of the key capabilities:

1. Data Analysis: Users can provide large datasets to the chatbot and request detailed analyses to identify trends, making it capable of handling data in various formats including CSV, XSLT, and JSON.
2. Data Visualizations: Code Interpreter can generate graphs based on provided datasets, useful for data exploration and visualizations.
3. Data Cleanup: Instead of manually processing data, Code Interpreter can clean up datasets in seconds, making it a valuable tool for data hygiene.
4. Game Generation: Users can instruct Code Interpreter to create games from scratch, offering a unique application in recreational coding.
5. Video and GIF Creation: The plug-in can also generate animated clips and GIFs from images and vice versa, providing users with more creative content creation options.
6. File Conversion: Code Interpreter can efficiently handle file conversions, such as transforming a PNG file into a JPEG, or an MP4 file into a GIF.
7. Code Writing and Debugging: Despite its focus on non-coders, Code Interpreter can write and debug code, demonstrating its ability to produce and improve coding output.
8. Playlist Analysis: The plug-in can be used to analyze Spotify playlists, offering new ways to interpret personal music trends.
9. QR Code Generation: Code Interpreter can also generate QR codes, simplifying this process for users and providing quick access to web links. 

Here is Andrew Stapleton's take on the OpenAI's latest:

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a GRC Strategist that is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else. This post was written with the assistance of an AI language model. The model provided suggestions and completions to help me write, but the final content and opinions are my own.

Welcome to 2023! What are five key tech trends that CPAs should be aware of?

With the crypto-ice age in effect, there is some rethinking on crypto and NFTs path in 2023. Here is CNBC's take: 

However, there are still a number of key tech trends that Chartered Professional Accountants (CPAs) should be aware of in order to stay up-to-date and competitive in the industry. These trends include cloud computing, artificial intelligence and machine learning, big data, cybersecurity, and digital transformation. By understanding and leveraging these technologies, CPA firms can improve their operations and better serve their clients.

1. Cloud Computing: Cloud computing involves delivering computing services, including servers, storage, and databases, over the internet rather than using local servers or personal devices. CPA firms can benefit from cloud computing by being able to access data and applications from any location, as well as scaling up or down as needed. For more on cloud and the world of CPAs, check out this post. 

2. Artificial Intelligence and Machine Learning: AI and machine learning technologies can help CPA firms automate routine tasks, improve decision-making, and gain insights from data. For example, chatbots are now able to generate fully coherent posts using natural-language processing. We covered this in our last post, with the rise of ChatGPT. If you haven't checked it out, it is must read. 

3. Big Data: Businesses are generating and collecting a large amount of data from a variety of sources, including financial transactions, social media, and internet of things (IoT) devices. Tools such as data visualization and advanced analytics can help CPA firms make sense of this data and extract valuable insights. In the early days of big data, I put this post together. It captures the hope and potential - much of which still needs to be realized.

4. Cybersecurity: Cybersecurity is a critical concern for CPA firms, as they often handle sensitive financial and personal data. It is important for CPA firms to have robust cybersecurity measures in place to protect against cyber threats such as hacking, ransomware, and phishing attacks. I've always felt that Cyber is a natural extension for CPAs. We're not just versed in the concept of controls, but also the realities of auditing those controls - an increasingly important way of conveying of compliance to a variety of stakeholders. See here for CPA Canada's list of resources.

5. Digital Transformation: Digital transformation refers to the use of digital technologies to fundamentally change how an organization operates and delivers value to its customers. CPA firms can benefit from digital transformation by streamlining processes, improving efficiency, and increasing agility. This may involve adopting new technologies such as cloud computing, AI, and big data, as well as rethinking business models and organizational structures. See here for more on the topic. 

In closing, it is important for CPA firms to stay informed about the latest tech trends in order to take advantage of new opportunities and meet the changing needs of their clients. By embracing technologies such as cloud computing, artificial intelligence and machine learning, big data, cybersecurity, and digital transformation, CPA firms can improve their efficiency, effectiveness, and competitive edge. By staying up-to-date with these trends, CPA firms can continue to deliver value to their clients and succeed in an increasingly digital business environment.

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a GRC Strategist that is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else

Figuring out FTX and SBF (Part 1): The Epic Rise in 5 videos

The recent weeks have seen the fall of crypto-king Sam Bankman-Fried (aka SBF). The epic rise and the spectacular fall of him and his FTX empire has us all asking one question: what happened?

We’ll initially explore this saga over several posts. 

 

In this post, we look at 5 videos that cover the rise of SBF and his FTX crypto-exchange. We’ll start by looking at how he initially got rich through arbitrage trading, look at the FTX “business model”, his connections to the US government, and then close with the celebrity endorsements that helped propel him to stardom.

 

Video #1: The Benevolent Billionaire?

Probably my first encounter with SBF, was in his interview with Nas Daily. We learn how SBF rose to fame in the crypto space by taking advantage of price differences in bitcoin in the US and in Japan. More importantly, the video captures the hope and the hype around the “earn to give” concept that SBF promoted. Turns out it was all hype and no hope. Vox published their twitter DMs with SBF, where he explains “I feel bad for those who get f***** by it…this dumb game we woke westerners play where we say all the right shiboleths [sic] and so everyone likes us” (link).

 

 

Video #2: Did SBF really say that Crypto is a Ponzi Scheme – 7 months ago?

On Bloomberg’s Odd Lot’s podcast aired back in April 2022, SBF seems to admit to Wall Street’s Wiseman Matt Levine that “magic internet money” is a Ponzi scheme. If you don’t have time to listen to the whole podcast, check out Coffeezilla’s quick takes. The technique that SBF discusses appears to  have been used in Celsius, which we discussed previously.  

 

 

Video #3: There are magic boxes, but magic business models?

On a separate but related note, FTX offered high rates of interests to depositors. As shown in Wall Street Millennial’s video, the rates were much higher than the fed rate that was close to zero at the time. This is not so much about the magic money box that SBF referred to in the previous video, but rather pure magic. How else can we explain the sustainability of such a high interest rate on bitcoin/Ethereum deposits? As CPAs know, when expenses exceed revenues – a business failure is inevitable.  (Click here to go to the timestamp where they discuss the issue of interest rate deposits)

 

Video #4: If you’re for regulations, you’re one of the good guys – right?

Stepping back, Cold Fusion’s video gives a good broad understanding of the key events that happened with the rise and sudden fall of FTX. (The previous video is also quite good as well). That being said, this video takes time to highlight SBF’s connection with the government and regulatory bodies.

 

Firstly, his mom is connected to the Democratic party. Secondly, he testified before congress, donated to both parties (not just the Democrats), and met with Gary Gensler from the SEC. If you look carefully at the screen shot where he speaks about the meeting with Gensler, you may recognize IEX’s Brad Katsuyama. (Reuters reported here on this meeting). He’s the protagonist of Michael Lewis’s Flash Boys. And that’s not the only connection to Lewis. Reports have emerged that Lewis had spent 6 months with SBF and is planning to publish a book about him. Lastly, there is an odd connection between FTX’s CEO, Caroline Ellison, and Gary Gensler. As Cold Fusion points out, Caroline’s father, Glenn Ellison, was Gensler’s boss at MIT.

 

Video #5: Is FTX a smart bet, with all these celeb endorsements?

Both Wall Street Millennial and Cold Fusion pointed out the role of influencers played in pumping the FTX/SBF brand name. But we don’t just need to take their word for it. We can see it for ourselves. Some of the promo videos are still live on FTX’s YouTube Channel. This video features Canada’s own Kevin O’Leary:

If you didn’t have a chance to go through the whole video, check out this part where he and the host emphasize the compliance-orientation of SBF and FTX. Now, that definitely didn’t age well. But perhaps what’s more surprising is O’Leary’s comments post-FTX meltdown. Apparently, he would back SBF in another crypto-venture (link).

 

Lastly, if you are interested in seeing the actual adverts aired on TV, check out this one featuring the actor Larry David.

 

In our next post, we’ll look at some more videos that take a closer look at the “Ten Days in November” that broke FTX and could have possibly ushered in the “Crypto Ice Age”.

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a GRC Strategist that is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else.

 

The #CryptoWinter Cometh? Some thoughts to consider

Is crypto winter upon us? It certainly seems that way.

According to Google Trends, fear, uncertainty, and doubt (FUD) around cryptocurrency and crypto-assets is top of mind as we search out the term “crypto winter”: 

Crypto winter, according to the World Economic Forum, is the situation where “prices [of cryptocurrencies and cryptoassets] have dropped a long way and then stayed low for weeks or months”

But is it really just FUD that’s fueling concerns? As noted in the Harvard Business Review:

“The past few months have been dark times for the crypto industry. Between April and June, Bitcoin’s value more than halved, from just over $45,000 to around $20,000; other coins have fallen even more. The Terra-UST ecosystem, which paired a crypto coin with one designed to be pegged to the dollar, collapsed in May, wiping out $60 billion worth of value and leading to cascading failures among crypto lenders. Established companies like Coinbase, a popular crypto exchange, have announced layoffs.”

With respect to Coinbase, they are laying off 18% of their staff (1,100 people) and have explicitly stated that it is due to the coming “crypto winter”:

"We appear to be entering a recession after a 10+ year economic boom. A recession could lead to another crypto winter, and could last for an extended period…"

With respect to the epic Terra-Luna collapse, we should keep in mind that it’s collapse rivals the Bernie Madoff Ponzi-scheme, which was in the $60 billion range as well. For more on what happened, check out Coffeezilla’s take on the matter:

 

Coffeezilla got his start exposing fake gurus, but now is actively exposing crypto-scams. As he notes in the New Yorker:

“Crypto scams are like discovering fentanyl when you’ve been used to Oxy. It’s a hundred times more powerful, and way worse.”

Beyond the Terra-Luna collapse, he has a great video on Celsius, a crypto-lender that offered exorbitant interest rates on deposits:

Celsius attempted to ride the anti-bank sentiment claiming that it wasn’t a bank, but they took deposits and then lent out loans on interest – which is exactly what a bank does.

Now they are no more: they have filed for Chapter 11 bankruptcy. In an added twist, they are claiming that the people who deposited funds with them are not account holders. Adam Levitin, a Georgetown law professor, explained to CNBC that:

“The treatment here seems to be that the customer’s crypto is actually the company’s property, and as an unsecured creditor, you don’t get your bitcoins back”

What does this all have to do with the crypto-winter?

These crypto-collapses have had a material impact on the industry. Reuters linked the 14% price drop in mid-June 2022 to Celsius freezing “withdrawals and transfers”.

With such spectacular disasters, what is in store for world of crypto and the promise of Web3? That's the topic we will explore in our next post!

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a GRC Strategist that is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else