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Crypto is feeling the chill...
June 14, 2022 View Online | Sign Up | Shop

Morning Brew

Cariuma

Good morning. The second supermoon of the year, the “strawberry moon,” will be visible this evening, reaching its closest point to the earth at 7:24pm ET. Make sure you catch it—scientists expect a strawberry moon to reappear only one other time this century, as the fourth track on the next Harry Styles album.

Neal Freyman, Matty Merritt, Max Knoblauch

MARKETS

Nasdaq

10,809.23

S&P

3,749.63

Dow

30,516.74

10-Year

3.364%

Bitcoin

$23,060.39

MicroStrategy

$152.15

*Stock data as of market close, cryptocurrency data as of 11:00pm ET. Here's what these numbers mean.

  • Markets: It’s official—after a gruesome day, the S&P 500 closed in bear market territory, meaning it’s dropped at least 20% from its peak. The prospect of aggressive interest rate hikes by the Fed has hammered stocks, including those most exposed to plunging cryptocurrencies. MicroStrategy, a software firm that made headlines by purchasing almost 130,000 bitcoins, has now lost about $1 billion on its gamble.
  • Government: During the Jan. 6 select committee’s second public hearing, aides of former President Trump and top government officials testified that Trump was “detached from reality” and repeatedly rejected their insistence that the 2020 election was fair. Also revealed: Trump’s campaign officials raised more than $250 million in donations following the election in order to pursue claims of fraud.

CRYPTO

Crypto temps near absolute zero

A thermometer in a crypto setting showing freezing temperatures Francis Scialabba

Not too long ago, crypto firms were buying Super Bowl ads and the naming rights to iconic sports stadiums. Now, they’re lucky if they can afford a seat in the nosebleeds.

The turmoil engulfing the sector has deepened in the past several days, highlighted by an ominous announcement by the Celsius Network, a leading crypto lender that was last valued at more than $3 billion.

Late Sunday night, the company froze all withdrawals and transfers due to “extreme market conditions.” It said it was taking the step to put it in a better position down the road to allow customers to withdraw their money.

The warning puts a spotlight on the murky world of interest-bearing crypto products that have surged in popularity over the past several years. Here’s how Celsius works:

  • Customers can deposit crypto into Celsius in exchange for shockingly high yields. Celsius’s website advertises annual returns of up to 18.6%, putting the return on government bonds or standard saving accounts to shame.
  • Celsius invests or loans out those deposits to other users in order to make money and pay out the interest.

It’s kind of like a bank for cryptocurrencies. But here’s the problem: It’s not regulated like a bank. Users don’t really know what Celsius is doing with the crypto they’ve deposited. And if Celsius goes belly-up, customer deposits aren’t insured like they are at a traditional bank. According to Celsius’s Terms of Use, “In the event that Celsius becomes bankrupt, enters liquidation, or is otherwise unable to repay its obligations, any Eligible Digital Assets used in the Earn Service or as collateral under the Borrow Service may not be recoverable…”

Regulators have started to crack down on yield-bearing crypto products. States such as New Jersey and Texas targeted Celsius last year, alleging that its interest-bearing accounts are equivalent to an unregistered securities offering. And Coinbase shelved its planned crypto lending product after the SEC started investigating it.

Big picture: Celsius’s freeze sent another chill through a crypto market that’s already on the verge of frostbite. The total value of cryptocurrencies fell below $1 trillion yesterday for the first time since January 2021. And the layoffs keep coming: Crypto.com (which employed Matt Damon to assert that “fortune favors the brave”) said it was cutting nearly 5% of its workforce, while the crypto lending startup BlockFi is laying off about 20% of its staff.—NF

        

TOGETHER WITH CARIUMA

Summertime? It’s all about the sneaks

Cariuma

Three words: sustainable summer sneakers. That’s just one way to describe Cariuma’s best-selling canvas sneakers. (They also go by cool, cozy, and classic.)

These kicks don’t just show you’ve got style—they show love to the planet, too. From the materials they’re made from to the factories they’re made in, Cariuma sneakers are eco-conscious every step of the way.

With a vast range of bright colors, neutrals, and bold prints, this best-seller also features collaborative colorways with brands like PANTONE, Atari, and even legendary surfer Gerry Lopez.

These kicks are known to sell out and rack up a huge (read: 61k) waiting list. They never go on sale, but Brew readers can get 15% off with code MBJUNE15. Get your summer ’fits ready here.

GRAB BAG

Tour de headlines

Amazon delivery drone Amazon

Amazon is launching drone delivery…finally. Nine years after Jeff Bezos first floated the concept on 60 Minutes, Amazon announced that its first drone delivery service would go live in the town of Lockeford, CA, later this year. The company’s once-hyped drone program has been agonizingly slow to lift off, beset by safety concerns, technical snags, and high employee turnover within the unit. And it’s not a done deal yet—the FAA still has to approve the service before the flying robots start dropping off packages in backyards.

Russia has made a boatload on energy exports since it invaded Ukraine. The country has earned almost $100 billion from selling oil and gas to other countries in the first 100 days of the war, according to a new study from the Centre for Research on Energy and Clean Air. That’s more than it’s spent on the war effort. Quick update on where things stand right now: Russian forces are focusing their efforts on taking the city of Severodonetsk, the last remaining Ukrainian stronghold in the Donbas’s Luhansk region.

Disney whiffs on streaming rights for IPL cricket. Viacom18, a joint venture between Paramount Global and Reliance Industries, bested Disney to win the online streaming rights for the immensely popular Indian Premier League (IPL). A single IPL match is now worth $13.4 million, making it the second-most lucrative sports product globally on a per game basis (the NFL is No. 1, at $35.1 million). Without IPL cricket, Disney could lose eyeballs in the Indian subcontinent, which accounts for 36% of total Disney+ subscribers.

EDUCATION

Ohio slashes gun training requirements for teachers

Ohio Governor Mike DeWine Justin Merriman/Getty Images

Ohio’s Republican governor, Mike DeWine, signed a bill into law yesterday making it a whole lot easier for the state’s teachers to carry guns at school. The law cuts the amount of required training from 700 hours to just 24 hours, well below Malcolm Gladwell’s 10,000-hour recommendation. DeWine said legislators have been working on the bill since last year, but the recent school shooting in Uvalde, TX, “increased the urgency to enact it.”

There are plenty of critics. In a joint statement, two Ohio teachers’ associations called it “dangerous and irresponsible,” and the Fraternal Order of Police said 24 hours is not enough training to carry a firearm. The bill was debated for more than a year on Ohio’s House floor, where 360+ speakers opposed it and 20 people spoke in favor.

Zoom out: Ohio is one of at least 28 states that allow teachers and staff to be armed on school campuses in the US, according to a 2020 Rand Corp study. A number of states have empowered teachers to carry weapons in the past decade: In 2013, Texas introduced a school marshal program to make it easier for select employees to carry guns on school grounds, and following the school shooting in Parkland in 2018, Florida passed a law allowing educators to be armed.—MM

        

FOOD & BEV

Zero-effort Jack and Coke is coming soon

Two cans of Coca Cola's Jack and Coke in a can Coca-Cola

Jack and Coke—the classic mixed drink made by combining Jack Daniel’s and Coke into a glass—just got even easier to drink.

Coca-Cola and Brown-Forman (Jack Daniel’s distiller) have teamed up to create a canned Jack and Coke cocktail, set to hit shelves in Mexico later this year before expanding globally. A zero-sugar version of the ready-to-drink cocktail will also be available, and diet/caffeine-free varieties can be made the old-fashioned way (see recipe above).

Canned Jack and Coke is the fourth new alcoholic beverage in Coca-Cola’s lineup in the last two years, joining Topo Chico hard seltzer, a spiked lemonade, and Fresca cocktails. If it’s looking for more, some free ideas while we’re here:

  • A Bloody Mary in a Powerade bottle
  • Hard Dasani
  • A White Russian with Sprite in it? Idk.

Zoom out: Canning the Jack and Coke highlights the company’s push into the rapidly growing ready-to-drink cocktail market. As soda consumption declines in the US and a truly disturbed “healthy coke” recipe made from balsamic vinegar and soda water trends on TikTok, the premixed cocktail market is on the rise: US sales grew by 42.3% in 2021.—MK

        

GRAB BAG

Key performance indicators

TVs with streaming services displayed on them Francis Scialabba

Stat: Brands are throwing away more than $1 billion a year in advertising spend because their commercials are playing on streaming platforms even while TVs are off, a new study by GroupM and iSpot.tv found. Viewers don’t always exit or pause the streaming app before hitting the power button on their TV, meaning that the show (and the ads) could still run in the background. About 17% of ads on TVs connected through streaming devices are being shown to no one, the study found.

Quote: “In the context of the current global outbreak, continued reference to, and nomenclature of this virus being African is not only inaccurate but is also discriminatory and stigmatizing.”

30+ scientists from around the world wrote a letter urging officials to change the name of monkeypox out of racism concerns, and the World Health Organization said it’s considering a change. Monkeypox, which has infected nearly 1,300 people during the current outbreak, isn’t even known to have originated from monkeys.

Read: Diet Coke probably isn’t a cognitive performance enhancer. (Dynomight)

TOGETHER WITH ELECTRIC

Electric

Unbeatable IT—for half the cost. Electric’s lightning-fast IT support can power your hybrid work environment, streamline onboarding, and so much more. And right now, IT decision-makers at US-based companies with 10–500 employees can get a free pair of Beats Solo3 headphones just for taking a qualified meeting with Electric. Book your meeting here.

WHAT ELSE IS BREWING

  • Charles Schwab will pay clients $187 million in a settlement with the SEC over hidden fees charged by its robo-advisor.
  • Lightyear, Pixar’s Toy Story prequel spinoff, has been banned from UAE cinemas, likely due to a same-gender kiss that occurs in the movie.
  • The temperature in Phoenix has not fallen below 80°F at night for the past week.
  • Prologis, a major warehouse landlord, is acquiring rival Duke Realty in a $26 billion deal.
  • The Scooby-Doo Mystery Machine van is now listed on Airbnb.

BREW'S BETS

You just read a lot of news: Here are some nature photos.

Tech Tip Tuesday: Five Excel shortcuts you should know.

Career inspo: How to become the “glue” person at your tech organization.

Psst. Meet us at the virtual water cooler. HR Brew and Fiverr are here to discuss the ongoing transformations of the 21st-century workplace. It’s all happening on 6/16 at 12pm ET—register here.

GAMES

The puzzle section

Brew mini: “Triple ___ liqueur” (3 letters) is your sample clue for today. Play the Mini here.

Claustrophobic airport trivia

Big thanks to the hundreds of readers who responded to our question yesterday about the airports most centrally located within a city. Some examples you mentioned were Boston’s Logan, Chicago’s Midway, and Dallas’s Love Field. Here’s one more—do you know which US city’s airport this is?

Las Vegas's airportEthan Miller/Getty Images

Elon Musk gets “firehose” of data from Twitter

Get highlights from last week’s news in less than one minute on our YouTube channel: Watch here.

Don’t miss out on more from the Brew:

The secret sauce for cult-favorite foods with the Sprinkles Cupcakes founder

Calling all innovators! Join us at the first-ever Emerging Tech Brew Summit September 29 in NYC. Secure your early-bird ticket today and save!

ANSWER

Las Vegas

         

Written by Neal Freyman, Matty Merritt, and Max Knoblauch

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