Good morning. It’s 1,031 days since I hit “send” on the first ever edition of Protocol Source Code. Today, with a heavy heart, I have hit that same button for the final time. Sadly, this is the final edition of Source Code you’ll receive. (But look out next week for an email from Politico about some alternatives you might like to read instead).

I wanted to take a moment to say what a pleasure and privilege it has been for everyone on the Protocol team to help you, our readers, navigate the world of technology. I hope you’ve enjoyed our work, I hope you’ve found it useful, and I hope you go on to read the work of our journalists at other publications in the future.

And for this, our final edition of Source Code, the Protocol team has nominated our favorite stories from the past three years. I hope you enjoy them one last time.

— Jamie Condliffe, Executive Editor

Concern trolls and power grabs: Inside Big Tech's angry, geeky, often petty war for your privacy by Issie Lapowsky

• “Issie wrote this piece before I joined Protocol. It was one of the stories I read that convinced me of Protocol's superiority in covering the wacky, interesting side of tech and power. I'd thought about the online data privacy debate in vague, general terms, but Issie distilled it and humanized it by following passionate engineers in the World Wide Web Consortium — a community I'd never heard of!”

Google contractors at data centers face forced unemployment by Anna Kramer

• “I'll always remember Anna's story on Google's data center contractors, because it shed light on an often unseen workforce in the tech industry and revealed how Google tries to skirt labor laws about contract workers by forcing these people into periods of unemployment. It's such a glaringly problematic practice, and I'm so glad Anna was able to bring it to light.”

From McDonald's to Google: How Kelsey Hightower became one of the most respected people in cloud computing by Tom Krazit

• “Kelsey Hightower's story is both inspirational and unusual, and his career says a lot about what a more diverse, more effective tech industry looks like. I thought it was incredible that Tom had a chance to tell such an important story at Protocol, and I was blown away by how well he executed on the piece.”

Can Silicon Valley be more ethical? Salesforce, Google hired ethicists to rethink processes by Linda Kinstler

• "One of Protocol's very first stories, and it signaled the kind of sophisticated, nuanced reporting that was to become the publication's trademark."

Microsoft Research Asia helped build AI in China by Kate Kaye

• “Kate's whole series on China + AI was terrific, but this article stood out to me for the way that it illuminated how Microsoft was an ‘instrumental force’ in China's rise as an AI technology power, and then deftly explored the many questions that arise about this as a result of the current political and economic climate.”

Google Cloud customers and partners grade CEO Thomas Kurian by Donna Goodison

• “It's not easy to write a definitive story about a topic this big, but Donna did just that in her article about Google Cloud's rise as an enterprise tech powerhouse, which notably featured great insights from the CEO driving the shift and multiple enterprise customers.”

Section 230 reform: Mark Warner's SAFE TECH Act by Issie Lapowsky and Emily Birnbaum

• “This was my favorite because it was covering the Section 230 event from March of 2021 when Senator Mark Warner got super aggressive with Issie but she just maintained her cool the entire time and still hammered him with hard questions. Definitely the first time I got to see our live journalism really make a difference.”

Why is tech illustration stuck on repeat? Ask the overworked, underpaid illustrators. by Hirsh Chitkara

• “This story was well sourced and well written but more importantly it did what all of my favorite Protocol stories do: made me aware of, and then care about, this entire issue I'd never heard about or considered before.”

Cloudflare protests over Kiwi Farms customer by Tom Krazit

• “This to-the-point piece did such a nice job of taking something that might be kind of opaque and hard to draw a bead on — like who provides enterprise anti-DDoS services to whom — and showing the very real-world intersections, implications, and politics involved.”

George Church, Ben Lamm create Colossal to bring back woolly mammoth by Biz Carson

• “I think about this story, no joke, at least three times a week. ‘Repopulating the Arctic tundra with extinct mammoths as climate change action’ was not a topic I woke up expecting to read about but I was so glad Biz covered it. If we had added a dinosaur cloning tech vertical I wouldn't have been mad about it.”

Welcome to Afterparty: One night at Hollywood's hottest NFT minting party by Nat Rubio-Licht

• “Nat did such a good job reporting this story. The scene they set was perfect, every detail they recalled and reproduced on the page just sang.”

Amazon warehouses have notorious injury rates. States are finally doing something about it. by Anna Kramer

• “I remain in awe of this story. Every single story Anna set her mind to in her time at Protocol was a slam dunk but to me this represents everything that makes her such a star, and what made Protocol so special. She dug through piles and piles of data and used it to tell a compelling, clear story that spotlit what continues to be one of the major labor issues of our time.”

The crypto-communists behind the Web3 revolution by Benjamin Pimentel

• “This was off-the-wall in the best possible way, a really fun look at the Web3 debate. The future of decentralized finance, it argued, echoes a decidedly Marxist vision of the future — but nobody was talking about it. Well, they were after this was published.”

Overturning Roe could change how digital advertisers use location data. Can they regulate themselves? by Kate Kaye

• “Kate should be commended for her ability to shine a light on the spaces in enterprise, specifically around privacy rights, that thrive on being opaque and hard to understand. Her stories like these did such a good job of packaging the exact kinds of information and processes where most users lack clarity and explaining why and how that ambiguity can be used to work against their best interests.”

Silicon Valley's new extreme: The 2:30 a.m. tech bus from Salida by Lauren Hepler

• “This was another of the first stories ever published by Protocol and it captured so much of what we wanted to do: tell the stories of the tech industry from within. It was a herculean reporting task on Lauren's behalf to be out at the bus stops and gain worker trust, and it set the tone from the beginning for our labor coverage later picked up by Anna Kramer.”

An oral history of #hugops: How tech's first responders built a culture of empathy by Tom Krazit

• “Tom's piece made me think of a whole group of people in a whole new — and much more sympathetic — light.”

The GE Mafia: How an old-school company birthed a generation of tech leaders by Joe Williams

• “I'm biased because of my Palantir piece [see below], but I think any ‘mafia’ coverage by Protocol really spoke to our reporters understanding the people, power, and politics of tech and being able to spot the trends along with it.”

Silicon Valley's newest mafia: The Palantir Pack by Biz Carson

• “Joe and Biz's stories were both able to capture why people that cut their teeth at one company had been able to find success at their next ventures. They both helped peel back the layers on company ethos with a unique approach that wasn't just interesting, but useful for others trying to create a similar culture elsewhere.”

Elon Musk offers $50k to teen to remove flight tracker bot by Veronica Irwin

• “This gets points for the art alone, but Elon Jet was such a fun story that set off waves of media coverage from people around the world picking it up.”

I helped build ByteDance's vast censorship machine by Shen Lu

• “Some incredible reporting on display here. A former employee laid out the what, how, and why of one of China's huge censorship and surveillance operations, and it made for utterly compelling reading.”

Through apps, not warrants, 'Locate X' allows federal law enforcement to track phones by Charles Levinson

• “Babel Street's tech became a recurring story, and that was led by this investigation into how the government tracks its citizens, and how a complicated system makes that possible”

Expensify’s CEO explains how he made the decision to tell all his customers to vote for Biden by Biz Carson

• “One way I liked to think about what we were doing at Protocol was bringing to life the conversations that people had in meeting rooms inside tech companies. I think this is the epitome of that: describing in great detail how someone made a huge and controversial decision.”

How IBM lost the cloud by Tom Krazit

• “Everybody knew that IBM had failed to capitalize on the cloud, but nobody knew why, exactly. This sharp, critical look at IBM from Tom did a fantastic job of piecing the story together, and served as a lesson in how not to think about the Next Big Thing.”

Why Microsoft's new Flight Simulator should make Google and Amazon nervous by Seth Schiesel

• “A game review that wasn’t a game review. Seth used the launch of Flight Simulator to shine a light on how Microsoft was thinking very differently than its competitors about the way it was bringing different teams and different technologies together.”

A tiny team of House staffers could change the future of Big Tech. This is their story. by Emily Birnbaum

• “Come for the lede — a political staffer changing light bulbs — and stick around for the incredible reporting. Emily’s story about a small group of House staffers, including the future FTC chair Lina Khan, pulled back the curtain on how the Big Tech antitrust battle was being assembled in D.C. It was essential reading for anybody who needed to know what was happening behind the scenes — the perfect Protocol story.”

The crypto reckoning in the Finger Lakes by Brian Kahn

• “One of the launch stories for our climate vertical, this feature took a close look at a tiny town in upstate New York that had become the stage of an unlikely showdown between bitcoin miners and a group of citizens looking to stop the industry in its tracks. In the process, it told a fascinating story about energy, our planet, and the regulation of crypto. That the artwork is all original, and by Brian himself, only served to make the story all the more special.”

Sequoia's invisible hand: How Roelof Botha became one of the most powerful people in venture capital by Biz Carson

• “A great profile is dense with anecdotes and details, but also manages to trace a line through them. Biz did that expertly in this piece, telling us all we needed to know and more about how Roelof Botha made his way from Tupperware salesman to leading one of Silicon Valley’s most successful VC firms. Still very much a must read.”

Figma's CEO pledges to 'retain our identity' as users fear the coming Adobe regime by Lizzy Lawrence

• “What a great story this was. It had the authority of an interview with Figma’s CEO, along with the sentiment of why day-to-day users were annoyed by the acquisition, and parceled it up into a really smart look at how people should be thinking about the news. And Lizzy turned it round so quickly, too!”

How Discord (somewhat accidentally) invented the future of the internet by David Pierce

• “I couldn't pull a top stories report without this story showing up. And for good reason! It manages to be both a deep-dive into one of the largest online platforms, while also explaining how that platform's framework may one day take over the internet.”

Amazon's entrepreneur dream is closer to a nightmare for many by Anna Kramer

• “Anna’s piece on Amazon's Delivery Service Partner program was absolutely captivating: It looked at the real-life and systemic effects of a massive company like Amazon over-promising and under-delivering, and the kind of turmoil that could cause in normal peoples' lives.”

The virtual real estate boom is turning the metaverse into the Wild West, and it has the true believers on edge by Nick Statt

• “The opening sentence to this story was incredible: ‘When Artur Sychov, the founder and CEO of metaverse platform Somnium Space, turned on his webcam for our interview, I was greeted by a black lizard-like creature, standing upright and emanating a pattern of white and green light across his face and chest.’ And the whole story was just as weird and wonderful.”

The US plans to block sales of older chipmaking tech to China by Max Cherney

• “Max led global coverage with his reporting around chip restrictions on China, so this is actually just one story of many that stand out as some of Protocol’s most impactful reporting. Incredible sourcing.”

And that's it! Thanks so much for reading. Goodbye!

Good morning! You might expect the former CEO of FTX, a company whose bankruptcy has been compared to that of Lehman Brothers and Enron, would want to keep quiet. But Sam Bankman-Fried does not want to be quiet. Let’s dig into what he had to say yesterday.

The confessions of SBF

Against the advice of his lawyers, Sam Bankman-Fried sat down in front of a webcam in the Bahamas yesterday to talk with Andrew Ross Sorkin of The New York Times. Dressed in a black t-shirt and sipping a can of LaCroix, he spoke for over an hour about what has happened to FTX, Alameda, and the billions of dollars with which they were entrusted.

The full transcript of the interview is well worth a read, but we’ve picked out some choice cuts.

On whether his lawyers were approving of his desire to speak publicly:

• “No. They are very much not. The classic advice, right: Don’t say anything. Recede into a hole. And that’s not who I am. It’s not who I want to be. I think I have a duty to talk to people … I don’t see what good is accomplished by me just sitting locked in a room pretending the outside world doesn’t exist.”

On the situation writ large:

• “Look, I screwed up. I was CEO I was the CEO of FTX. And I say this again and again that it means I had a responsibility, and I was responsible ultimately for us doing the right things and didn’t. We messed up big.”

On whether he’s considered criminal liability:

• “It sounds weird to say it, but I think the real answer is it’s not what I’m focusing on … There’s going to be a time and a place for me to think about myself and my own future. But I don’t think this is it.”

On his future:

• “I don’t know what’s going to happen. A lot is not in my hands at this point. I want to be helpful wherever I can to regulators, administrators, internationally, who are working to help FTX’s customers.”

On his current financial health:

• “I don’t have any hidden funds here. Everything I have I am disclosing and I am down to — I think I have one working credit card left. I think it might be $100,000 or something like that in that bank account. Everything I had, even all the loans I had — those were all things I was reinvesting in the businesses that I put everything I had into FTX.”

On his reported drug use:

• “There were no wild parties here. When we had parties were we played board games … I have been prescribed various things at various times to help with focus and concentration … that I think on the margin help me focus a little bit.”

On whether he’s ever lied about FTX:

• “I don’t know of times when I lied. Look, there are times when I, certainly times when I was acting as a representative, as a marketer for FTX and when I was looking for how can I — in a way which is truthful — paint FTX in as a compelling way as possible.”

Bye bye, Bret Taylor

Exactly a year after he was promoted to the position of co-CEO at Salesforce, Bret Taylor announced that he’s departing the company.

Marc Benioff pulled Taylor close after Salesforce acquired his startup Quip in 2016. Taylor became COO at Salesforce, and then was elevated to co-CEO on Nov. 30, 2021.

• Benioff called Taylor “a phenomenal industry leader” when he was made co-CEO, adding that he had been “instrumental in creating incredible success for our customers and driving innovation throughout our company.”

Taylor is leaving to return to his “entrepreneurial roots,” he wrote in a statement.

• “While there’s absolutely no easy time for a transition like this, I do now feel like it’s time to return to my entrepreneurial roots particularly given the landscape and economy going through such shifts,” Taylor said on an analyst call yesterday.
• Taylor previously worked on Google Maps in the early 2000s, sold a startup called FriendFeed to Facebook, and built the productivity software startup Quip.
• Benioff expressed his gratitude on the investor call: “We have to let him be free, let him go, and I understand, but I don’t like it. And Bret, you know that you’re always going to be our brother. We love you deeply, you have a home here.”

But is this becoming a trend? Keith Block left the position of co-CEO at Salesforce in Feb. 2020 after just 18 months in the role, having previously been in the role of COO.

• Benioff has previously said that he likes the “divide and conquer strategy” that the co-CEO setup provides.
• For now, Benioff will be the lone CEO at Salesforce. There’s been no word yet on plans for a new co-CEO, though if previous transitions are anything to go by then current COO Brian Millham is presumably fidgeting in his Aeron.

People are talking

Elon Musk seems to have made up with Tim Cook:

• “Thanks @tim_cook for taking me around Apple’s beautiful HQ. Good conversation. Among other things, we resolved the misunderstanding about Twitter potentially being removed from the App Store.”

But Mark Zuckerberg joined in with the criticism of Apple’s walled garden:

• “Apple has sort of singled themselves out as the only company that is trying to control, like unilaterally, what apps get on a device. I don’t think that’s a sustainable or good place to be.”

And so did Spotify CEO Daniel Ek:

• “Over and over again, Apple gives itself every advantage while at the same time stifling innovation and hurting consumers. Apple acts in self interest but also doesn’t seem to care about the law or courts.”

Netflix co-founder Reed Hastings thinks the company should’ve started running ads sooner:

• "I wish we had flipped a few years earlier on it."

Making moves

Crypto exchange Kraken laid off 1,100 employees, or about 30% of its workforce, “in order to adapt to current market conditions,” CEO Jesse Powell wrote.

John Stauffer is leaving Apple for Roblox, where he will be a vice president of engineering. At Apple, he was in charge of media-related software technology.

Meta is subleasing part of its Hudson Yard office space in New York, Bloomberg reported. It took on 1.5 million square feet of office space there in 2019.

In other news

Neuralink will be ready for human testing in six months according to Elon Musk. It is working on helping disabled patients to move and communicate, and is now also targeting restoration of vision. Wired’s Emily Mullin has a good close look at how the technology is evolving.

Amazon will warn customers about the limits of its AI, including details about bias, privacy and other ethics issues in publicly available information akin to nutrition labels.

TSMC plans to make more advanced chips in the U.S. after being urged to do so by Apple, according to Bloomberg.

SpaceX has been accused of age discrimination by a former employee who posted a long essay on the whistle-blowing platform Lioness describing the problems he encountered at the company.

Cruise wants to test cars with no controls — yep, that means no steering wheel — on the roads of San Francisco.

There’s a Senate hearing on FTX today, and Rostin Behnam, chairman of the Commodity Futures Trading Commission, is expected to be grilled on whether tighter regulation could have prevented the company’s failure.

The Chamber of Commerce pushed back against an EU plan that would make it harder for non-EU cloud vendors to provide services for EU governments.

LastPass has suffered a data breach that exposed “certain elements” of customer information.

Thoughts, questions, tips? Send them to sourcecode@protocol.com, or our tips line, tips@protocol.com. Enjoy your day, see you tomorrow.

Good morning! Elon Musk has become increasingly vocal about his issues with Apple’s App Store tax. But what options does he really have open to him? Let’s dive in.

A rebel with a cause 

So, you paid over the odds to buy out a company. You need to find new ways for it to generate revenue. You came up with what you think was, honestly, an incredible solution. But what if somebody is going to tax that shiny new revenue stream?

Elon Musk is railing against Apple’s App Store tax. Apple still lays a 30% levy on payments through apps in its ecosystem for developers who make over $1 million through the App Store, with a few other expectations too.

• “Did you know Apple puts a secret 30% tax on everything you buy through their App Store,” Musk tweeted earlier this week.
• That levy would take a large slice out of revenue Twitter makes from Musk’s proposed $8 per month Blue subscription plan, which will give users access to verification. That service is expected to launch this week, initially … just on iOS, according to The Information. (Maybe Musk’s initial plan of charging $20 wasn't such a bad idea after all?)
• Apple has so far remained silent on Musk’s comments.

This isn’t exactly a new debate. Musk is joining some industry heavyweights in his outrage at Apple’s approach to the App Store.

• Most notably, Epic clashed with Apple in court over its control of the App Store ecosystem and … not a whole lot changed as a result. Apple does now have to allow developers to link customers to their own payment systems, but many users still pay through apps for convenience.
• Spotify’s Daniel Ek has also been a vocal critic of the App Store tax, most recently arguing that Apple continues to “disadvantage competitors, and the impact is huge - on consumers [and] app developers.”

The obvious chain of events, if Musk were to try to find a way around the App Store levy, seems straightforwardly problematic for Twitter…

• Apple is nothing but hardline about protecting its control over the ecosystem. Remember that Epic found itself with Fortnite removed from the App Store for trying to skirt the 30% fee.
• Musk has said that “Apple has also threatened to withhold Twitter from its App Store, but won’t tell us why,” though that seems to predate his public pushback of App Store charges and is likely more to do with content.
• You would think that Musk surely couldn’t risk Twitter being removed from the App Store at a time when he is clearly desperate to ensure that user growth keeps hitting new highs. Still, it’s unclear if Apple would go ahead with removing Twitter from the App Store.

But Musk could be playing a bigger game. Or at least, he could be trying to.

• In a now deleted tweet, Musk suggested he was “going to war” with Apple.
• So far, he seems to be rallying the masses by attempting to sully Apple’s reputation around concerns of free speech. “Apple has mostly stopped advertising on Twitter,” he tweeted. “Do they hate free speech in America?”
• As CNBC has outlined, this could be the start of a bigger plan that goes something like: get Twitter kicked off the App Store; spark raging national debate about Apple’s role in free speech online; force Apple to modify its business practices; victory.

Is this all slightly fantastical? Undoubtedly. But then, so was buying Twitter. If we know much of anything about Musk, it’s that he’s unpredictable and not shy of taking swings that others would demur from. Hold onto your hats, this could get exciting.

Five ways to improve your information security 

If there’s one thing that’s true about cybersecurity, it’s that no organization is ever entirely secure. Still, there’s plenty you can do to make things more secure, and Protcol’s Kyle Alspach recently put together an entire special report on how enterprises can better protect themselves. Here are five key ways your business can improve information security.

• Deploy (or strengthen) multifactor authentication: “When it comes to information security ROI, multifactor authentication is hard to beat. Requiring a second form of identity verification, beyond just a username and password, has been shown to prevent the vast majority of credential-based attacks.”

• Explore passwordless authentication: “While it's still a new concept, passwordless authentication holds a lot of promise for businesses. Some just allow users to skip entering their password; other options eliminate the password completely.”

• Keep awareness training up to date: “Since it's the humans themselves who are often the weakest link, many organizations at this point understand the value of security awareness training for staff. But that value can be diminished when the training regimen lags behind current attacker trends.”

• Empower employees to work securely: “Scolding employees for the use of unauthorized applications, aka ‘shadow IT,’ is increasingly being recognized as something to ‘not do.’ Rather than admonishing employees, organizations should help employees feel like they can self-report when they're using an unsanctioned application for productivity reasons.”

• Keep risks in perspective: “Despite the concerns about threats from malware, the reality is that the vast majority of malicious activity does not include any use of malware, according to CrowdStrike. Compared to malware-based attacks, the threat posed by credential-based attacks ‘needs more attention’ than it's getting right now, said CrowdStrike CTO Michael Sentonas.”

A MESSAGE FROM HASHICORP

Organizations moving to the cloud need a new operating model — one that rethinks how they manage infrastructure, handle security, and connect systems. Platform teams trust HashiCorp’s stack of automation software to build the powerful, easy-to-use infrastructure their business needs to innovate.

Learn more

People are talking

Yoel Roth, Twitter’s former head of of trust and safety, explained why he left the company:

• “We had a system of governance. It was rules-based. We enforced our rules as written … and when that system of governance went away, you don’t need a head of trust and safety anymore.”

Making moves

Faraday Future’s head of product, Robert Kruse, resigned, Bloomberg reported. Its CEO was also removed earlier this week.

In other news

What’s the news from AWS re:Invent? Former Protocol enterprise editor Tom Krazit has the lowdown in his newly relaunched newsletter.

For some color on the FTX debacle, read these emails and text messages published by The New York TImes, which show exasperated lawyers and executives got with Sam Bankman-Fried.

China has taken steps to boost its semiconductor chops, according to the FT. It has Alibaba and Tencent working with researchers to use the Risc-V chip architecture in an effort to increase domestic production.

Airbnb launched a new service that will allow renters — or at least, those with approving landlords — to offer short-term sublets of their property on the site.

Twitter is no longer policing COVID-19 misinformation, which means it will stop removing or tagging such content.

BlockFi appeared in bankruptcy court on Tuesday, and told the judge that it was “the antithesis of FTX,” a line it looks set to continually repeat over the coming weeks.

Crypto brokerage Genesis hopes to avoid bankruptcy, it said, after Bloomberg reported that its creditors were speaking with restructuring lawyers in a bid to achieve the same goal.

Why does streaming keep getting more expensive? This is why.

Recruiters have felt the pain of the tech layoffs, and The Wall Street Journal has taken a close look at how and why they’ve been affected.

Where did Jack Ma go? Tokyo, according to the FT.

A MESSAGE FROM HASHICORP

Organizations moving to the cloud need a new operating model — one that rethinks how they manage infrastructure, handle security, and connect systems. Platform teams trust HashiCorp’s stack of automation software to build the powerful, easy-to-use infrastructure their business needs to innovate.

Learn more

Thoughts, questions, tips? Send them to sourcecode@protocol.com, or our tips line, tips@protocol.com. Enjoy your day, see you tomorrow.

Good morning! FTX’s problems are increasingly other people’s problems, and BlockFi is the latest company to fall victim. Let’s dive in.

Well hello there, crypto contagion 

The latest crypto casualty is upon us. Yesterday, BlockFi announced that it had filed for chapter 11 bankruptcy protection.

• BlockFi has as much as $10 billion in liabilities and as many as 100,000 creditors. It currently has $256.9 million in cash on hand, which it hopes will provide it with enough liquidity “to support certain operations.”
• According to the filing, Ankura Trust Company is its largest creditor, with a claim to $729 million, followed by none other than FTX US, which has a claim to $275 million.

BlockFi is deeply entangled with FTX, as the Financial Times points out, and BlockFi cited a “lack of clarity” around Sam Bankman-Fried’s operations as one of the reasons for its bankruptcy.

• FTX came to BlockFi’s rescue in the spring, offering it a credit line of $400 million.
• FTX’s Alameda Research borrowed nearly $700 million from BlockFi, and BockFi’s cryptocurrency is, unsurprisingly, currently stuck on FTX’s platform.
• The FT also reported that BlockFi is now suing Sam Bankmen-Fried “to seize shares in Robinhood that the FTX founder allegedly pledged as collateral just days before his exchange collapsed.”

In the filing, BlockFi distanced itself from FTX. "Although the debtors' exposure to FTX is a major cause of this bankruptcy filing, the debtors do not face the myriad issues apparently facing FTX," Mark Renzi, managing director at Berkeley Research Group and advisor for BlockFi, wrote in the filing.

• BlockFi is suggesting that bankruptcy offers it a chance to “stabilize the business” and “consummate a reorganization plan that maximizes value for all stakeholders, including our valued clients.”

How big is this house of cards? As Protocol’s Tomio Geron wrote earlier this month, the crypto industry is a sprawling mess, and it’s unclear which companies and individuals are exposed to which risks.

• There’s a very real possibility that, rather than a handful of organizations falling, the contagion continues to spread. So far, we don’t have a clear picture of how entangled the industry is, though Reuters is piecing together what we know so far about exposure to FTX across the sector.
• If the fallout keeps spreading, BlockFi’s vision of emerging as a phoenix from the flames may prove to be overly optimistic.

What’s got the attention of VC right now?

Hindsight is a wonderful thing. And there could be plenty of it on display in coming months, according to a new analysis of where VC money went in Q3.

DeFi and Web3 were the emerging technologies of choice for the world's top-15 most successful VC firms in the third quarter of 2022, according to PitchBook’s latest quarterly emerging tech indicator.

• Across the deals analyzed in the report, those sectors drew a combined $879 million in investment in Q3 across 24 deals.
• Just behind them were fintech, with $737 million of investment across 24 deals, and biotech, with $726 million of investment across 11 deals.

Crypto investment is headed downard, though. The same analysis shows that crypto investment has crashed from a peak in Q1 2022 of over $2.3 billion across 33 deals. Meanwhile, second-place fintech has held pretty steady over recent quarters.

• Things could yet get worse for crypto startups. “The recent failure of cryptocurrency trading platform FTX and the subsequent contagion across the industry is likely to have a negative impact on future investment levels,” Pitchbook writes.
• Looking for something to peg your crypto hopes on? “There are areas of the cryptocurrency ecosystem that are less exposed to trading activity, which could be less impacted by the fallout from FTX,” the report adds.

A MESSAGE FROM HASHICORP

Organizations moving to the cloud need a new operating model — one that rethinks how they manage infrastructure, handle security, and connect systems. Platform teams trust HashiCorp’s stack of automation software to build the powerful, easy-to-use infrastructure their business needs to innovate.

Learn more

People are talking

There’s no question over Senator Chuck Schumer’s view on the China chip situation:

• "If American business wants the federal government to buy their products or services, they shouldn't be using the kind of Chinese-made chips that, because of Chinese government involvement, put our national security at risk."

What’s on Bob Iger’s to-do list? Making Disney’s streaming business profitable is near the top:

• "Instead of chasing [subscribers] with aggressive marketing and aggressive spend on content, we have to start chasing profitability."

Elon Musk’s Boring Company has been ghosting cities that it promised to work with, according to Chicago alderman Scott Waguespack:

• “Every time I see him on TV with a new project, or whatever, I’m like: Oh, I remember that bullet train to Chicago O’Hare.”

Making moves

Faraday Future has a new global CEO in Xuefeng Chen, who was most recently CEO of the company's China division. Chen replaces Carsten Breitfeld.

Remember how Justin Zhu was fired from his role as CEO of Iterable for taking LSD? Now he’s suing the company, alleging discrimination over his East Asian background.

In other news

Elon Musk accused Apple of threatening to remove the social media company’s app from the App Store and said it had largely stopped advertising on the platform. No response from Apple so far, but this could easily become A Thing, so have popcorn at the ready.

AWS is rolling out access to new chips that promise the kind of high performance required for workloads such as weather forecasting and gene sequencing.

The U.S. is pushing its allies to consider mirroring its own semiconductor bans against China, according to the CEO of the Dutch chip toolmaker ASMI.

Crypto exchange Kraken settled with the Treasury, agreeing to pay more than $360,000 over accusations that it violated U.S. sanctions.

Google is settling with the FTC, paying $9.4 million to draw a line under an investigation into potentially deceptive endorsements.

Meta was fined $275 million by Ireland’s Data Protection Commission for a data leak that violated the EU’s General Data Protection Regulation.

The U.K. government is scrapping a rule that would have allowed it to force tech companies to take down “legal but harmful” content, after it received heavy criticism. That U-turn is also now facing criticism.

Foxconn is offering bonuses to factory workers who agree to return to its production facilities in Zhengzhou as it struggles to keep its workforce staffed up.

Snap will require employees to be in its offices for 80% of their time starting the end of February.

A MESSAGE FROM HASHICORP

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Thoughts, questions, tips? Send them to sourcecode@protocol.com, or our tips line, tips@protocol.com. Enjoy your day, see you tomorrow.

Good morning! This morning, we’re getting you ready for the holiday season with a list of books you definitely need to read. Let’s dig in.

Your holiday book list

It’s that time of year when you want to compile a reading list for the longer nights and downtime of the Christmas season. And maybe you also want some gift ideas too. EIther way, we’ve got you.

We asked our panel of experts, the Braintrust, for book recommendations that would help people make sense of their respective industries. Here are some of our favorite suggestions.

“Venture Deals“ by Brad Feld and “Secrets of Sand Hill Road” by Scott Kupor
“Excellent books for understanding the fundamentals of venture investing.”
— Brennan O'Donnell, partner, Frontline Ventures

“This Is How They Tell Me the World Ends” by Nicole Perlroth
“It’s one of the most in-depth and yet approachable books on some of the hidden parts of infosec. I highly recommend it if you want to learn more than just the relatively boring minutia of actual enterprise security.”
— Ian McShane, VP of strategy, Arctic Wolf

“The Grid: The Fraying Wires Between America and Our Energy Future” by Gretchen Bakke
“This book provides an important technical and sociological foundation for the advocacy many of us are doing to support a more distributed and sustainable electric system.”
— Anne Hoskins, SVP, policy and market development for energy technology, Generac Power Systems

“Cryptonomicon” by Neal Stephenson
“A science fiction novel published in 1999, [it] describes the promise of cryptocurrency, a decade before the Bitcoin whitepaper was published. For me, the book shows the promise of — and demand for — crypto, long before the technology was even viable.”
— Diogo Mónica, president and co-founder, Anchorage Digital

“Playing to Win" by Roger Martin
“The essential modern guide to building and leading company strategy; it brings science to the art of strategy and is pragmatically built on the act of making decisions.”
— Sam Ramji, chief strategy officer, DataStax

“The Five Dysfunctions of a Team” by Patrick Lencioni
“A quick read, but an invaluable guide. So much of what we do comes down to building trust, navigating conflict, and driving results and it illuminates really core dynamics within modern work.”
— Dave Carhart, VP of people, Lattice

“The Hard Thing About Hard Things” by Ben Horowitz
“[This] lays out some of the difficult challenges and choices of being a startup CEO.”
— Donnel Baird, CEO, BlocPower

“Process Mining: Data Science in Action” by Wil van der Aalst
“He is a true inspiration, and his research changed my life. Reading that book was the start of an adventure to bring a new way of running processes to companies everywhere — an adventure that involved my co-founders and me hand-writing over a thousand letters to top executives, crisscrossing Germany in a beat-up Opel Astra, and much more.”
— Alexander Rinke, co-CEO and co-founder, Celonis

“How Law Made Silicon Valley” by Anupam Chander
“A good primer on how contingent tech competitiveness is on policy choices, including their timeliness and clarity. It's important for the policy community to understand that choices we make now will make (or break) local, national, and global tech competition outcomes for decades to come.”
— Mike Linksvayer, head of developer policy, GitHub

“Redefining HR” by Lars Schmidt and “Inclusion Revolution” by Daisy Auger-Domínguez
“People are the backbone of businesses and decision-making. The approach, rules, and boundaries are changing and HR professionals and the field must adapt; these two books help push us all to think differently about people, HR, and DEI.”

— Laura Shen, chief diversity and inclusion officer, WEX

“The Motorcycle Diaries” by Ernesto "Che" Guevara
“No two days in the start-up world are the same - every day brings new adventures and your skills tested in managing new challenges.”
— Devie Mohan, founder, Burnmark

A MESSAGE FROM HASHICORP

Organizations moving to the cloud need a new operating model — one that rethinks how they manage infrastructure, handle security, and connect systems. Platform teams trust HashiCorp’s stack of automation software to build the powerful, easy-to-use infrastructure their business needs to innovate.

Learn more

People are talking

When it comes to crypto, Binance CEO Changpeng Zhao says world governments should be regulators, not fighters:

• “I think most governments now understand that adoption will happen regardless. It's better to regulate the industry instead of trying to fight against it.”

The Kids Online Safety Act could harm minors, civil society groups wrote in a warning to lawmakers:

• “Online services would face substantial pressure to over-moderate … KOSA would cut off another vital avenue of access to information for vulnerable youth.”

Making moves

Carlyle Group raised more than $3 billion for a fund that will invest in European technology. Did somebody mention a downturn?

Crypto startup MoonPay hired Keith Grossman, currently the president of Time, as its own president.

In other news

The latest at Twitter? Elon Musk showed off plans for how Twitter will become an everything app, including encrypted DMs, longform tweets, and payments. He also got excited about how new user signups and user active minutes are at record highs. And the new verification service will apparently launch “tentatively” this week.

Tesla is working on a revamp of the Model 3, according to Reuters, to cut production costs and focus on the features that its customers value the most. It’s also recalling about 80,000 cars in China due to problems with software and seat-belts.

Meta is now an extremist organization in the eyes of the Russian government.

Yandex’s holding company wants to cut ties with Russia, according to The New York Times. It plans to transfer Yandex’s most promising technologies to global markets to protect itself from fallout from the war in Ukraine.

Black Friday made a comeback, with sales up 12% according to Mastercard — though some of that could be inflation. Electronics were reportedly popular.

The FCC expanded a ban on the sale of telecom and surveillance equipment made by 10 Chinese companies. The ban prevents the marketing or importing of new products by companies including Huawei and ZTE.

Chaos as a result of protests at Foxconn’s manufacturing plant in Zhengzhou could leave Apple with a 6-million device shortfall this year, Reuters reports.

Amazon is closing some businesses in India, including meal deliveries and bulk deliveries to small businesses.

Binance committed $1 billion to an industry recovery initiative that it will use to invest in troubled crypto companies. It could extend the commitment to $2 billion.

The U.K. will fine tech companies that fail to remove content that promotes self-harm.

A MESSAGE FROM HASHICORP

Organizations moving to the cloud need a new operating model — one that rethinks how they manage infrastructure, handle security, and connect systems. Platform teams trust HashiCorp’s stack of automation software to build the powerful, easy-to-use infrastructure their business needs to innovate.

Learn more

Thoughts, questions, tips? Send them to sourcecode@protocol.com, or our tips line, tips@protocol.com. Enjoy your day, see you tomorrow.