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China's complete crypto crackdown

Bitcoin

Good morning! This Friday, China said crypto is illegal, the European Commission wants to set a charging cable standard, and Lina Khan set a few goals for the FTC.

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The Big Story

China cuts crypto

China just took its hardest stance on cryptocurrencies yet.

All crypto transactions are now illegal in China, the nation's central bank said in a notice posted to its website, and cryptocurrencies cannot be circulated. (Excluding those overseen by the government, obviously.)

  • The notice names bitcoin, ether and tether specifically, but applies to all transactions of any kind involving cryptocurrency. Overseas exchanges are also not allowed to provide services to users in China, according to the new notice.
  • Some are speculating that the move has to do with China's reaction to the Evergrande debt crisis, which has already had ramifications in the crypto world.
  • The overall crypto crackdown also has to do with Beijing's climate goals; the country wants to be carbon-neutral, and crypto activity makes that harder.

It's not like China is out on crypto altogether. Inside the country, the government is experimenting with digital currencies, and is already testing a "digital yuan" in cities around the country. It's a bit like the country's approach to its tech industry as a whole: It wants to be innovative and successful, but on the government's terms.

But China is not interested in the global crypto system. For years, Beijing has been cracking down on crypto mining around the country, and banned exchanges from operating within its borders.

  • In that sense, this new announcement isn't all that surprising. It's just an extra-aggressive version of what Beijing has been saying for a while. After years of making it harder for Chinese citizens to get involved in the global world of crypto, the government made it illegal.
  • Enforcing any kind of crypto ban is hard work, though. Companies like Binance have shown that crypto trades are always just a VPN away, and as these systems continue to spread and decentralize they become increasingly impossible to fully shut down.

The great promise of cryptocurrency was a borderless, global financial system that governments couldn't corrupt or meddle with. That was always a bit of a pipe dream. But China's crackdown has made it clearer than ever: Digital money could have borders too.

— David Pierce (email | twitter)

The Other Big Story

The EU wants USB-C to rule the world

The European Commission has dropped the hammer on charging ports, and specifically Apple's Lightning standard that has persisted, stubbornly, for the last nine years.

The European Commission is all-in on USB-C. On Thursday, it announced plans to revise its Radio Equipment Directive to mandate that USB-C become "the standard port for all smartphones, tablets, cameras, headphones, portable speakers and handheld videogame consoles." While most devices already use USB-C, the iPhone and some select consumer electronics like portable speakers and wireless headphones do not.

There are two goals: cutting inconvenience and e-waste. The commission cites data saying 11,000 tons of e-waste are produced every year just from disposed of and unused chargers. Consumers also spend €2.4 billion annually on chargers not included with their devices.

  • The problem has become less acute over time, considering the number of charging ports has essentially reduced from 30 down to three: Lightning, USB-C and micro-USB.
  • But the commission says 38% of consumers still report problems with charging, from not having a compatible cable to match their device port.

Apple is pushing back. The company has already transitioned most of its product line to USB-C, including new iPads and MacBooks. But this year's iPhone 13 lineup still features the Lightning port, meaning Apple maintains control of the iOS mobile accessory ecosystem.

  • The EU's order allows for a transition period of 24 months from the date of adoption by the European Parliament and the Council. That's plenty of time for Apple, but the company wasn't too keen on yesterday's news.
  • "We remain concerned that strict regulation mandating just one type of connector stifles innovation rather than encouraging it, which in turn will harm consumers in Europe and around the world," Apple said in a statement to CNN.
  • Apple has a lucrative accessories ecosystem it controls through its MFi licensing program, earning it money on every cable and charger sold. The good faith reading here: Apple doesn't want old Lightning accessories made obsolete.

The proposal has a clear loophole. One potential avenue to sidestep the USB-C requirement is wireless charging, which the commission did not address in yesterday's order. That leaves open the door for Apple and other companies to introduce portless phones that avoid USB-C altogether.

The EU says it won't ignore wireless charging forever. "It is also necessary to provide the basis for adaptation to any future technological progress," the commission told The Verge. But there are also other complications to a universal USB-C standard that will require some further clarification, like how not all USB-C cables are capable of transmitting the same type of data at the same speed.

In the meantime, please enjoy this absolutely mind-melting video ad released 10 years ago promoting a universal charging standard. It never gets old.

— Nick Statt (email | twitter)

Protocol Event

Making sense of vaccine mandates

Vaccine mandates were already gaining popularity among tech companies looking to bring their workers back to campus safely. Now, the Labor Department's Occupational Safety and Health Administration is expected to issue a new rule requiring companies with 100 or more employees to mandate vaccines or weekly testing.

What does this mean for tech employers, and how should they be preparing for this new mandate? Join Protocol's Allison Levitsky for a conversation on what the vaccine mandates means for you, your company and your employees with Engage Peo HR consultant Sadiqa Banks-Holsey, Nixon Peabody OSHA partner Rachel Conn, and Gartner head of HR research Brian Kropp at 9 a.m PT / noon ET on Thursday.

A MESSAGE FROM ALIBABA

Thousands of U.S. businesses sold more than $50 billion worth of their products to Chinese consumers with Alibaba last year. Alibaba provides the tools and infrastructure that U.S. businesses need to build their brands in China and reach local consumers.

Learn more

People Are Talking

Marc Benioff says Facebook needs more accountability:

  • "I own Time, and I am held accountable for what is produced on my platform. In regards to Facebook, they are not held accountable."

Alexei Navalny is frustrated at Apple and Google for removing a voting app before Russia's election:

  • "I know that most of those who work at Google, Apple, etc. are honest and good people. I urge them not to put up with the cowardice of their bosses."

On Protocol: It's inaccurate to say payment for order flow or gamification caused the GameStop controversy, Robinhood's Dan Gallagher says:

  • "I think this is a deflection, quite frankly, by folks to not let a good crisis go to waste."

Maryana Iskander said she's going to lean on neutrality as Wikipedia's new leader:

  • "Have the debates on talk pages on the side, but then come to an informed, documented, verifiable, citable kind of conclusion on the articles."

Making Moves

ServiceTitan is reportedly planning for an IPO early next year. The software company was last valued at $9.5 billion.

Facebook's Antigone Davis will testify at a Senate hearing Thursday. Davis is the company's global head of safety.

Scott Slipy is joining Socure as chief people officer. Slipy was formerly an exec at Microsoft and Cisco.

Camille François is leaving her role at Graphika as chief innovation officer. She's been with the company for a little over three years.

Bijan Sabet is stepping back at Spark Capital. Sabet worked as a general partner and had been with the firm for nearly two decades.

TSMC dismissed seven employees for leaking confidential company information.

In Other News

  • The Facebook Files whistleblower will soon go public, Sen. Marsha Blackburn said. The person said to be behind the leak may also testify before Congress, an aide to Blackburn told The Washington Post.
  • Lina Khan has a few major FTC goals: She outlined five principles, like ensuring the commission is in tune with issues Americans face, and three policy priorities based on those goals, like reviewing merger guidelines for businesses.
  • Airbnb may have more room for Afghan refugees. The company said it could accommodate another 20,000 refugees if there's enough housing in the areas where refugees are resettling.
  • Thought the chip shortage was bad? The majority of surveyed electronics manufacturers said they're struggling to find qualified workers, according to a trade group representing companies like Intel and Foxconn.
  • Twitter is letting you tip content creators with bitcoin. The platform is also testing some new safety features, like one that allows people to leave tweet threads they no longer want to be part of.
  • Google's big Manhattan office purchase isn't that special; large tech companies like Amazon and Facebook have been growing in New York City for years. Take a look at how Big Tech has expanded its footprint all over the Big Apple since 2009.
  • Jawbone Innovations is suing Apple and Google over the two tech companies' noise canceling technology in some of their products. Patents originally owned by the now-bankrupt Jawbone are at the center of the suit.

One More Thing

Free weekend streaming

If you don't already have access to HBO and Cinemax, your weekend's about to be full of new content. YouTube TV subscribers have through Monday to stream shows and movies from the two networks for free.

Maybe you can knock some movies off your list, like "The Invisible Man" or "Lincoln," or shows like "The Sopranos." And if you're not a fan by the end of the weekend, you can always just go back to your regular streaming service.

A MESSAGE FROM ALIBABA

This year, China will become the first country where ecommerce sales will outpace brick-and-mortar transactions. U.S. businesses are using Alibaba's platforms to sell to 900 million digitally savvy consumers in China and untap new opportunities for long-term growth.

Learn more

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

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