Pongo Points 12/21/23

SEC doesn't want to make crypto rules | AI solves an unsolved math problem | Germany buys more fossil fuels | Tim Draper's Bitcoin thesis | Biocomputers and artificial intelligence

1. SEC Rejects Crypto Rules Proposal

Why it’s interesting: Coinbase filed a petition for rulemaking for crypto markets as a way to deter more lawsuits against crypto companies, but the SEC responded with a stark “no” to the proposal.

What stands out: SEC Chair Gary Gensler supported the SEC’s response, yet makes careful and specific mention of “crypto asset securities” being subject to federal law - differentiating them from “crypto assets” generally.

What’s next: Gensler’s response letter contains careful phrasing and language to avoid pegging all crypto assets under SEC purview, suggesting that there are more cryptocurrencies that are not securities (like Bitcoin, which he’s already mentioned publicly).

2. Google AI Cracks Unsolved Math Problem

Why it’s interesting: Google’s AI unit, DeepMind, has created a model called “FunSearch” that generated an inspired solution to the cap set problem that did not previously exist.

What stands out: Researchers claims that this is the first time an AI model has discovered a solution to a puzzle, claiming that “FunSearch searches for programs that describe how to solve a problem, rather than what the solution is.”

What’s next: FunSearch represents not only a novel and valid creation by an AI model, but inspires a new perspective of how to have future AI models approach solutions to problems.

3. Germany Buys $55 Billion of Natural Gas from Norway to “Decarbonize”

Why it’s interesting: Germany’s state-owned energy firm Sefe signed an agreement with Norway’s Equinor to buy 10 billion cubic meters of natural gas per year for 10 years.

What stands out: Sefe’s CEO stated that the deal “ensures the sustainable and future-proof supply” of natural gas, which is commonly used for electricity generation and heating, given Germany’s forced replacement of its previous suppliers in Russia.

What’s next: Earlier this year, Germany closed three nuclear power plants that produced nearly 12% of the country’s electricity in favor natural gas, a fossil fuel - despite Germany cheering on the fossil fuel phase-out during COP28.

4. Tim Draper Sees Bitcoin as a Platform

Why it’s interesting: Tim Draper is a well-known VC who is an early adopter of Bitcoin (as early as 2014), and put forth his vision for Bitcoin as a platform much like Microsoft or the internet.

What stands out: Draper mentions the large delta between Bitcoin today at around $40,000 versus other popular crypto assets, and Bitcoin at $40,000 versus other crypto assets nearly 20 months ago.

What’s next: Draper calls out a number of recent innovations that took place on Bitcoin, such as ordinals, layer-2 smart contracts, and more, as evidence that many of the ideas in crypto will slowly convene back onto Bitcoin as a base layer (Pongo has written about this a lot too!).

5. Biocomputer Made from Brain Cells Recognizes Human Voice

Why it’s interesting: Researchers at the University of Indiana Bloomington created a hybrid computer made of organic brain cells and conventional circuitry that responded to different voices.

What stands out: The biocomputer was connected to an AI system and trained to react to different speakers and eventually produced responses to identify the speakers with an accuracy of 78%.

What’s next: The study effectively confirms theories about creating organic computer systems, suggesting that AI models could one day harness the speed and efficiency of living tissue.

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