Tech News: FTX Co-Founder Arrested!

gonna be I think a chunker of an episode. So first, let's tackle the total mess that is the collapse of f t X and the consequences that collapse has had in the world of finance in general and cryptocurrency in particular, and co founder Sam Bankman freed specifically. But first, in case you're not familiar with f t X, I'll set a little foundation. So f t X was the second

largest cryptocurrency exchange in the world. So a cryptocurrency exchange is an organization designed to take currency in one form and exchange it for an almost equal value in some other form, just like you would do if you were to visit a foreign country and you wanted to swap out your native cash for the cash of the country. And I say almost equal value because the exchange, of course takes a little cut of each transaction. That's one

way that the exchange makes money. And like a lot of exchanges, customers can also choose to store their currency in whatever digital form it might be in within the exchange itself, rather than extracting the money to put into a separate digital wallet. Sometimes taking money out also means that you get a cut taken out of it. So once those cuts start adding up, a lot of customers say, you know what, I'll just leave it in there, so that way I'm not losing more money by taking it

out of the system. So, as I said, f t X was the second largest cryptocurrency exchange. It was behind another company called Finance, which we are also going to talk about in this episode. And f t X also issued its own cryptocurrency token that was called f t T. And yes, one major problem with this story is that we use a lot of initialisms and it stinks and

I'm sorry, but that's just how it is. So f t X the exchange would award f t T tokens to customers, and you could also trade your money in for f t T. You could actually just cash into f t T if you wanted to, and you can use f t T to hold your wealth. Now, while ft t was native to f t X is exchange, it was also an accepted token on other exchanges. Now, one of the co founders of f t X, as I said, was Sam Bankman freed or s b f as a was known in the crypto world, and I

hate that. So I'm just calling him Sam so that we don't just have initials everywhere. Before co founding f t X, Sam had also co founded a hedge fund that focused on crypto. He did this a couple of

years previously. That company was called Alamator Research. Well. Back in November, a crypto news outlet called coin Desk published a leaked records sheet that indicated that f t X was funneling money from exchange customers to go to Alamator Research in order to cover investment losses and loans and things like that, which is kind of like robbing Peter to pay Paul. You take cash that isn't yours from one source in order to cover debts that are yours elsewhere.

The publication of that leaked record sheet led to a full on collapse of f t X, which was exacerbated first when financed chairman Cheung Peng c z Jo, we'll just called Chong Peng said that Finance, which had been an early investor in f t X, was dumping its holdings of f t T. So Binance had millions of f t T tokens that it kept as a result of being an early investor in f t X. So Binance says, we're dumping it, We're getting ready, we're cashing out.

That sent the value of f t T into the crapper. Right, if you flood a market with an asset, the value of that asset decreases. So then Binance said, you know what, we're gonna help you out. We're gonna buy f t X, and then almost immediately backed out of that non binding agreement, which really it was like a shot to the heart, and Finance was to blame. So f t X really took it that time. And there's also the question of hundreds of millions of dollars of f t X customer

funds having just gone missing. You know, there are there are records of transactions that happened that went to some mysterious recipient, where all this money that should have belonged to ft X customers was essentially at least by appearance stolen, and there are a lot of people who suspect that either Sam or one of as many crypto bros took

the money before things totally fell apart. The collapse of f t X, which was already coming at a time when crypto was having a rough go of it sent a huge ripple out in the crypto world, and we saw investors start to lose even more confidence in crypto and values would drop across the board. Pretty much. That's our foundation. Now we can actually talk about what's happened recently. So first up, Sam's headquarters for f t X was

in the Bahamas over the last year or two. So a lot of these crypto exchanges maintain their headquarters overseas and places that have let's say, relaxed laws and regulations regarding financial institutions somewhere that's out of the purview of major financial regulators, like like what we have here in the United States. But you know, rich people they really hate it when someone else steals their money or causes

them to lose money. So rich people will go to really great links in order to get justice, as opposed to say, if a poor person is robbed, you don't see nearly as much effort to help that person. Yes, this is commentary, but it's also true. Okay, so yeah, it stinks anyway. In the wake of this collapse, with all these rich people losing lots of money and then the revelations about f t X and alimated research, the police in the Bahamas launched an investigation into f t

X and our buddy Sam. Folks over here in the United States were likewise eager to look into the matter, and the Senate Banking Committee wished to hold a hearing about f t X this week. In fact, it was supposed to happen today, and they wanted Am to testify at this hearing. Sam reportedly declined to acquiesce to their request, so, in other words, he told him to pound sand and senators said they had offered two different dates for Sam.

They had included the option for him to attend virtually where he wouldn't have to actually travel to the United States, and he still declined, and his attorney said he had no intention of obeying any subpoenas that the Senate might request. So it sounded like Sam was really holding out to avoid being pinned down. But that would not last because while we were hearing about Sam deciding not to appear before the Senate. The Bahamanian authorities were preparing to arrest him,

and they did on Monday evening. So last night, the U S. Attorney for the Southern District of New York indicted Sam and sent the sealed indictment to the Bahamanian authorities and they acted upon it. So presumably this also sets the stage to extradite Sam from the Bahamas to the United States, where he will face new risk charges. Now this is a separate but parallel effort with what

we're hearing about the Senate hearings. In fact, senators were surprised to learn of Sam's arrest and some have expressed disappointment that he will not appear before the Senate to explain the situation that led to f t x's collapse. As for the charges that Sam faces, they reportedly include counts of securities fraud, conspiracy, securities fraud itself, wire fraud conspiracy, wire fraud itself, and money laundering. Yeah, rich people really

don't like it when folks take their money. The U S. Securities and Exchange Commission, or SEC, accuses Samba committing a quote years long fraud end quote, meaning this isn't just

about the months that led up to f t x's demise. Essentially, the SEC seems to be saying that f t X was really not so much a cryptocurrency exchange as it was a funnel that would collect money from customers and then send that to Alimated Research in order to fund trades and real estate deals and to give out massive loans to the company's founders, including Sam, who, according to the SEC, borrowed a staggering one point three three eight

billion dollars from Alameda. That's a lot of money to borrow. Right on top of the SEC's charges against Sam, there are other agencies waiting to get in line to take their shot. They include the U. S. Attorney's Office for the Southern District of New York, which we mentioned earlier, and also the Commodity Futures Trading Commission or c f TC.

Sam will appear in court in the Bahamas today. He does not have the luxury of saying no to that appointment, and the Bahamanian government is pretty darn eager to talk to Sam outside his discussions with the US because the government very much wants to reclaim more than two hundred fifty million dollars worth of Bahamas property that Sam and f t X executive Ryan Salami. Um, it's maybe it's Salame.

It's s A L A M E that I'm gonna say Salami anyway, Ryan, I'll say Ryan and Sam purchased two million plus dollars of Bahama, Bahamas property in the past. That's actually thirty five different properties across New Providence, Bahamas. Those properties have been tangled up in the bankruptcy proceedings for f t X because uh, you know, ft X brought in a new CEO in order to oversee the

company going into bankruptcy. But the Bahamanian government says that one having a U S court handled Bahamanian property is inefficient because it could be done much more smoothly in the Bahamas. So it's a waste of resources, is what they're saying. But more importantly to having a foreign court handled that sort of thing is illegal by Bahamanian law anyway, That it's against the law in the Bahamas for property in the Bahamas to be handled by a foreign you know,

legal system essentially, is what it comes down to. I only include this part of the story to show how incredibly complicated. This whole crypto issue has become because it affects both digital and real world assets. Current fd X CEO John I, dismantled in Ron Ray, probably doesn't want

any of that to happen. He doesn't want the properties to be relegated over to the Bahamanian authorities because it's his job to try and squeeze as much out of the corpse of f t X in order to return assets to investors as he possibly can, So surrendering two million bucks worth of real estate doesn't really fit in with that plan. And y'all, I cannot wait for the flood of TV series and films that will cover this

mess in the future. Now, before I go to break and then move on to a related topic, I have one last thing to say about f t X. The Australian Financial Review reports that an inner circle I called it a cabal, but an inner circle running f t X, had created a secret chat group in the days leading up to the collapse, and that chat group had the

name according to the Australian Financial Review of wire Fraud. Now, that seems like it's a supremely stupid thing to do to me, Like I just I just can't see why anyone would make a chat group called wire Fraud. I mean, maybe it was gallows humor, right, maybe it was done as a tongue in cheek, snarky way of of trying to deal with the situation, because otherwise you're you're leaving

a smoking gun laying around on purpose. But then the group was also using Signal, which is a messaging and chat at that's known for you know, secrecy and encrypted messaging. So it's possible that wire Fraud wasn't meant to be humorous or ironic or or sarcastic. It was just you know, to get everyone on the same page. Now, Sam for his part, denies knowing of such a group and said that if it does exist, he was not in it. Uh yeah, wild, Okay, we're gonna take a quick break.

When we come back, we'll talk about some other issues in the crypto world and a couple of other stories, but first let's go to these messages. Okay, we are done talking about the recent developments with f t X and Sam Bankman Freed, But now let's talk about Finance, the largest cryptocurrency exchange in the world. Uh. The former investor into f t X, and then arguably slayer of f t X, and now it is at the center

of its own turmoil. Although to say now is being unfair, because it turns out Finance has been under serious investigation for years, well before the collapse of f t X. The Wall Street Journal reports that Finance has been trying to mollify customers and reassure them that unlike f t X, Finance has the reserves to cover all customer funds that are stored within the exchange, and then a little extra

as a reserve. But the journal sites and accounting professor named Douglas Carmichael, which side note, if you have the name Douglas Carmichael, I think it's the law that you have to be an accounting professor. Anyway, He says that the quote unquote proof that Finance has offered so far is probably not sufficient to back up what the company is claiming. It's probably not going to be enough for

serious investors to feel comfortable with the situation. Shan Now, it's not necessarily the case that Finance doesn't actually have the funds, but so far the evidence being shared is not enough to support the claim that everything is hunky dory. And the proof so far is a single report which is more like a five page letter from a quote partner at the South African affiliate of the global accounting firm Mazaars end quote in the county in the Land

of Oz. According to the journal, the report included three whole numbers in it an exhaustive report of finances, systems and policies. No, it was not that, obviously, um, it was not an audit report. It did not actually go into what control systems, if any, that finance uses. Uh So, in other words, a lot of stuff that investors might want access to, a lot of transparency did not come

forward in this letter, in this report. So that's part of why Carmichael says investors are probably not really satisfied with this report because all they got were these three numbers. Two of those numbers also had a bit of concern to them. So one of the numbers is about how much total currency in bitcoins are in the exchange, and the other numbers how many total bitcoins customers held in

the exchange. So, in other words, let's say you all bank at the same place, does the bank actually have enough money so that if every single person who had an account came in and withdrew all of their money, the bank would be able to cover it in this case. You know, what Finance had been saying is, yes, we have a one to one cover for all currency held in our exchange. But as it turns out, those numbers

are not the same. They the currency actually has few were bitcoins in its reserves than customers have quote unquote held in the exchange, by the tune of our almost well actually a little bit more than fifteen thousand bitcoins. Now, this is an exchange that has more than half a million of those ding dang darn things. So it's not like it's not like fifteen thousand represents a huge percentage, right,

But it's still concerning. Right if if everyone suddenly got nervous and decided to withdraw their money out of the exchange, Well, based upon this, the exchange does not have the currency to cover all of that, and that was one of the big concerns with f t X and really lead to its collapse. However, Finance also says, hey, the reason for this is that we also issue loans to customers, you know, loans of cryptocurrency. So some of the money

that belongs to US is outstanding. It's not it's not currently in our reserves, but it's where we hold it in the form of loans that have been is you to customers, and those loans will be repaid with interest, which means ultimately, yes, we can cover everything. In fact, we have one collateral. Our collateralization is really what we call it. It's just that right now, technically they don't have it. So things are just kind of shaky on an investor front. But uh, that's not the end of

finance's troubles by a long shot. So the U s Department of Justice has actually been actively investigating finance for years, particularly in realms of money laundering and processing payments that sidestep international sanctions, such as money that gets funneled to places like Iran uh where which should otherwise be subjected to UH two sanctions. Reuter's reports that Binance has been responsible for processing ten billion dollars in illegal payments this year,

and that does not sound good. Apparently, the US government has even been in discussions with finances legal teams over the matter of plea deals. You know, when you start talking plea deals, that's just things are starting to build up against the crypto exchange here in the States at least.

But Reuters also reports that the various departments within the d o J that are involved in this investigation, and there are three major departments that are part of this, they aren't completely aligned on when to move forward with any charges filed, and some of those departments have a

more methodical approach than others. So by that, I mean there are divisions within the d o J that are very thorough when they build a case, which can be frustrating to other departments that tend to act more aggressively. And I think there are valid arguments for both approaches. Right, being methodical leads to building a better case against a suspect if in fact, you determine that there is a case to be made, or it might save you lots of time and money if you realize, oh, you know,

there's not enough there there. Meanwhile, being aggressive can mitigate ongoing harm, right You can cut off the harm that is happening right now by acting faster. That is, assuming of course, that the case has merit. If the case

doesn't have merit, then being aggressive can cause more harm. Obviously, anyway, there's no telling where this is going to end up in the long run yet, but it does mean things are increasingly chaotic, so much so that Finance temporarily halted withdrawals of U s d C earlier today in an effort to stem a transactional problem on the platform. So U s d C is a stable coin that is linked to the US dollar. UH. Investors sometimes use us DC to swap one form of cryptocurrency to another without

actually having to convert it to real US dollars. Uh. It's just you know, a digital version of the US dollar in in many ways, it's a stable coin, is

what's called. Anyway. The issue, according to Chung paying himself, is that if a Binance customer wants to convert p a X or b U s D into USDC, so in other words, these specific forms of crypto into the stable coin U s DC, that process requires routing through a bank that's in New York, and at the time where people were trying to do this, the bank had

not yet opened. So Binance decided to clamp down on those transactions in an effort to swap out a different token two facilitate these switches from one cryptocurrency to another. In the meantime, over the last twenty four hours, Binance has seen customers would draw more than one point six billion dollars worth of assets from the exchange. So even if all these investigations ultimately lead nowhere Finance, this situation right now is a bit rocky because investors have freaked

out due to multiple red flags. So crypto is in a really delicate place right now. I'm not suggesting that crypto is gonna completely collapse and that it will no longer be the grand experiment that it was, but rather it's in for a real hard time in the at least the short term, if not the long term, as these major exchanges that have kind of built themselves up into being pillars of the crypto community, a community that infamously values itself on being decentralized, are now in potential

jeopardy either because of a lack of investor confidence or in the case of Finance, being the active subject of massive investigations into money laundering and other violations. Like that's

bad news. That does not necessarily mean that there would be a direct effect on the cryptocurrency values themselves, but frequently what you'll see is investors get worried, they start pulling their investments, they convert it back into a different form of currency, and in some cases they may just cash out entirely and say you know what, Uh, this was an interesting approach, it's not for me. I'm done, and that ultimately ends up hurting the entire crypto community. Personally,

I think that crypto is not great. I think there are a lot of reasons why crypto is not great. I think that the the selling point of it being decentralized is a smoke screen. It's really just centralized in a different way, um, and that it consolidates wealth in a different group of people than what we saw before. So it's not like it's I wouldn't say it's worse than what we already have, but I wouldn't say it's better either. It's just different, um, and different in a

way that's very unstable. So I am very much against the whole crypto thing from that perspective. Maybe it survives all of these trials and tribulations, it will mature to a stage that is more reliable, less volatile, more acceptable as an actual currency as opposed to a commodity. But that's all. Those are a lot of ifs, and I remained skeptical. I'd love to be proven wrong. It's just I suspect I will not be all right, that's enough of that. We're gonna take another quick break when we

come back. We've got a few more tech stories to cover. Quite a few actually, as I look at my lineup, but they're shorter as they involve lots of other stuff. So we're gonna take a break, come back and tackle those in just a moment. Okay, we're back. So one ongoing story we have talked about several times on this show is Microsoft's bid to acquire the video game company at division Blizzard, and of course, Activision Blizzard itself is the source of lots of stories, many of them dark ones.

But anyway, the US Federal Trade Commission, or FTC, has sued Microsoft. In fact, it did this last week in an effort to block this acquisition, and has called the merger and anti competitive move that or reduce competition in

the video games market. Now, The New York Times predicts that this is going to be a very tough case for the FTC to prove in court because courts typically see companies like Microsoft and Activision Blizzard as being distinct and they are not necessarily companies that compete directly with one another. Therefore, when companies that don't directly compete merge, you don't have a reduction in competition because the two

companies didn't represent competing entities in the first place. So that's the logic that the New York Times is using. They're they're thought of as a vertical mergers, and that you know, usually such a merger isn't viewed as having a measurable impact on competition. As a result. Now, it may turn out that the FTC is going to just completely fail in this effort, but we are seeing this kind of resistance to that specific merger of Microsoft and

Activision Blizzard happening around the world. In some cases, we've seen it where it appears that Sony representatives have played a part in sowing UH distrust in the acquisition, suggesting that Microsoft is kind of locking video game publishers and developers away behind their own corporate UH boundaries and that ultimately that will cut off access to competitors like Sony.

So the long story short, the argument is that hey, if if Microsoft buys Activision Blizzard, then in the future, Sony is not gonna be able to get access to Activision Blizzard titoles, something that Microsoft reps have said multiple times is just not what's going to happen um Anyway, It's really interesting to see the FTC push hard against moves that it sees as potentially being anti competitive, because here in the US for the last several decades that

just hasn't been the case. There's been a very lass a fair approach which was really infamous in the eighties that allowed companies to kind of consolidate and grow larger and buy up their competition with really no resistance from the US government. That is changing, but it does mean that the FTC is going to have a very long list of battles to fight. And also Microsoft has a

history of getting out of these kind of situations. At one point, courts had ruled that Microsoft was to break apart into different companies, but ultimately that decision was reversed and so the company continued as as we know it. So I I suspect this is probably not going to succeed in court based upon just how long a shot it is. But I also feel that consolidation in general typically is not the best for the end consumer in most cases, So uh, and also big tech getting bigger

is not something I'm terribly interested in seeing. It's just that I think there are other battles into space that are more important. Okay, we're not done yet. We got some Twitter and some Tesla news. Of course we do, because you can't get away from me. On Musk. On Sunday, he tweeted, quote, the boats are in for a surprise tomorrow end quote. And turns out so was most of Southeast Asia. You see, Musk had promised to rid Twitter

of bots. That was like one of his big things when he was first being so braggish about buying Twitter, before he decided that he didn't want to buy Twitter, before he decided, yeah, no, I will buy Twitter. So anyway, the solution that he and his team apparently came up with was not to identify bots on the platform and then block those bots. Instead, it was to cut off access to entire mobile networks that had been known to

carry bought traffic on them. But these networks are also used by you know, real human beings who actually use and in some cases rely upon Twitter. So Twitter essentially cuts access off from these networks, and that left tons of legitimate users unable to access Twitter on their devices, and then in came a flood of complaints and requests for help. So what did Twitter do well? It did the exact same thing we saw when the company rolled out the paid for blue verification check marks last month.

It subsequently rolled the decision back. This time, Twitter reps actually claimed the whole problem was due to quote routing configuration changes end quote, which sounds to me like it's just a lie to cover up the fact that the company made a unilateral move that affected both bots and real people equally, then had to back pedal. I want to stress it sounds to me like a lie. I'm not saying it is a lie, it just sounds like one.

Now one might start to call in the question Musk's reputation for being a genius at this point, you know, just from based upon recent evidence. That is, if the person had not already dismissed such an idea years ago. Many of you out there, I'm sure, are in that camp already. And last week three members of Twitter's Trust

and Safety Council resigned. They said that under Musk, Twitter's users safety is on the decline and that the council isn't being listened to, and that Twitter is actively becoming a more dangerous place instead of a safer one, particularly for really houlnerable people like kids. As such, these council members have decided that if they cannot do anything about it, and if Musk is not going to listen to them,

there's no reason to stay. They are not authorized to make the changes needed to improve safety, and Twitter does not really have the resources needed to make such a thing possible, now that so many people have left the company somewhere around by some estimations, and it sounded pretty darn grim. There's also news about Tesla's UH advertising woes. Obviously those continue. I'm not going to go into great

detail because those numbers are changing so fast. By the time you listen to this it will be out of date anyway. But let's just say that Twitter is UH is having real problems on the advertiser front, and the hope that subscriptions to Twitter Blue is somehow going to counteract that, I think is optimistic. Say, Tesla is facing a class action lawsuit that claims the company has engaged

in fraud. Now, Tesla's lawyers are saying, quote mere failure to realize a long term aspirational goal is not fraud end quote, and they're asking a judge to dismiss this case. Now, those of y'all who have listened to tech stuff for a while, you likely know my thoughts about this. Yes, Tesla has failed to realize a long term aspirational goal in the form of creating a truly autonomous vehicle, and no,

failure is not fraud. However, during that time, Tesla has also marketed products called autopilot and full self driving, which, if we are to assume that you know, words mean things, suggests that the vehicle should be capable of operating all on their own and yes, on its web pages if you go and read it, Tesla has repeatedly said it that it's advanced driver assist features are not a substitute

for a human driver. They are not an autonomous system. However, the company continues to market those tools with names that suggest otherwise. On top of that, Elon Musk has repeatedly proclaimed we're just a year or two away from full on robo taxis, where you'll be able to turn your car into a revenue generator. And this isn't something he's only said recently. He's been saying it over the years, and each year comes and goes and they don't achieve

that goal. And again that's not necessarily fraud on its own. But when you start taking into these into consideration, a combination of all this with the marketing and the naming conventions, things get a lot more muddy. I mean, if I were to sell you a bottle of flying potion, and you were to drink the bottle of potion and then you break your leg as you jumped off a tree limb when you fell to the ground, I couldn't just say, oh, well, I just failed to get the potion right. It's an

aspirational goal. No, you would say I committed fraud because I sold you a potion that doesn't do the thing that I said it does. Now, if I left a little label on that potion that said does not actually give you flying powers, I might have a pretty decent argument. I'd probably be called a scumball for legitimate reasons, But I have an argument to say, like, hey, no, no, no, I have a disclaimer here. So we'll have to wait and see if courts agree with Tesla's lawyers on the

matter or if it will proceed. Because I just don't know I mean, you could and you you can't say legitimately that Tesla said on its web page this is not an autonomous system. But again, the marketing and naming makes it difficult. Right, It's a very muddy sort of thing to look at. Now, there were some other news items I had originally lined up to talk about that I I was going to include, but it would have

made this episode run super long. It involved stuff like there were worries about surveys that show Tesla's brand image

has taken a real nose dive. It's gone into negative territory, which is not completely on the company itself, although partly, I mean, there are a lot of people complaining about things like build quality of Tesla vehicles, but it also obviously takes into consideration things like Ellen Must's behavior on Twitter, which really has no, you know, direct relationship with Tesla, but still is having an impact on people's perception of it.

Then I also had a story about um Meta cutting back on rideshare allowances as a part of cost cutting measures. But I feel like we've done enough bad news. Let's end with something that's actually kind of amazing. Although we're also going to take a step back and a little reality pill in the process. We're going to talk about fusion and a breakthrough at the Lawrence Livermore National Laboratory in California. First, let's give a quick rundown on nuclear fusion.

The nuclear power that we use around the world right now in order to generate electricity is fission. That's where you harvest energy that's generated upon the splitting of heavy atoms. This splitting perpetuates a series of reactions that keeps things going, and when you use this with careful controls, you can release tons of energy in the form of heat that

you can then harness to generate electricity. However, the fission process creates dangerous nuclear waste that you have to figure out what to do with, whether that's to process it further or to you know, bury it somewhere or whatever. And there are other dangers involved, including the possibility of accidents like we've seen at sites like Three Mile Island or Chernobyl or Fukushima. Those dangers range from releasing radioactive material into the environment all the way up to nuclear meltdown.

So there are some big challenges with fission to do it in a way that is not just safe but people feel comfortable with it, right, So that's that's part of it. There is another nuclear process called fusion, and fusion we have to light atoms that fuse together. This process also releases energy, but it also requires a good amount of energy to get the reaction going in the first place. Because atoms don't want to get that close, right,

They don't want to fuse together like this. You have to force them to do it, and that means you have to exert energy to make it happen. Once they do it, they release energy, but you've gotta spend energy first. So fusion is the nuclear process that occurs in stars, where you know, gravitational forces and pressure are providing the energy needed to generate and sustain fusion. That's not something we can easily replicate here on Earth, right, we can't

just make a man your star. So the sun generates the light we see through fusion as high erogen combines to form a type of helium at a temperature of millions of degrees. Shout out to they might be giants. If we can harness the power of fusion in a way where we can release sustainable energy that we can convert into electricity, that would be a tremendous breakthrough. It

would totally revolutionize the energy economy. It's the kind of thing that could provide a way to entirely ditch fossil fuels and things like internal combustion engines and switch to electric motors because electricity would be plentiful, it would be cheap, it would be environmentally friendly, it would not produce things like the dangerous nuclear waste that fission plants do, and the fuel we'd be using would be among the most

plentiful in the universe. Kind Of there's an asterisk by that, but I'm not going to go into great detail about that anyway. A huge obstacle to fusion has been finding a way to initiate reaction so that the net output of energy is greater than the net input we used to get the reaction going. So if you have to spend more energy to get things moving then you get out of the process, that's a net loss. You get yourself a nonstarter. It doesn't make sense. You're just gonna

be losing energy in the in the whole system. So the researchers at Livermore have managed to initiate a reaction and get more energy out then was put in with their lasers. And to be clear, I'm not saying they created energy. You cannot create energy. Rather, the energy needed to start a process was less than what the process released. It's kind of like how if you were to light a pool of fuel with a match, the energy given off by the burning fuel would be way bigger than

the energy you use to light the match itself. You didn't generate it, it's just the process that's releasing that energy. Now, there are are some asterisks that we have to address before we can say all our energy concerns are behind us. For one thing, we do get a net positive amount of energy out of this reaction only if we're just considering how much energy the lasers were directing to the

fuel source. So in that sense, it took two point zero five mega jewels from lasers to start a process that ultimately released three point one five mega jewels of energy. So yeah, more energy out than what you put in. However, to power those lasers would require more than just two point oh five mega jewels because these pew pew laser beams are not efficient. In fact, they are far from it.

They are very inefficient. It took three hundred mega jewels to power the lasers, then the lasers generate that two point oh five mega jewle beam. So yeah, if we factor in that the three hundred mega jules we needed to power the system, well, releasing three point one five mega jeweles is not a Grand Slam home run, right However, it is a step forward, and there are other methods we can use besides lasers to initiate fusion. Some of them may prove to be far more efficient in the

long run. So this is a good development, right it is. It is something we should celebrate. It is not an earth shattering breakthrough because we still have some massive hurdles to overcome and we are not going to be switching over to fusion power right away, but we are a little closer to that goal. So that is something I

think we need to be excited about. It's just important that we also understand the limitations that still stand in our way, because my fear is that if we don't acknowledge those things, then people start to get upset when a year or two or five later they're saying, where the heck are these fusion reactors we were supposed to have? Right, Everyone's like well, I heard that there was a ether.

Why don't we have them yet? We have to understand what the challenges are, the engineering challenges, the science that needs to be perfected in order for us to be able to create an efficient system, so that we have a realistic expectation of how far along we are and how far away our goal is. And that way we don't get discouraged, because if we do get discouraged, then funding gets cut, and if funding gets cut, we never get to where we want to go. Okay, that's it.

This was a super long news episode. Hopefully Thursdays will be much shorter. Hope you are well. If you have suggestions for future topics of tech Stuff, please get in touch with me. You can leave me a voice message on the I Heart radio app. It's free to download and use. You can just navigate on over tech Stuff, use that little microphone icon, leave a voice message up to thirty seconds, end lengths, and you're good to go. Let me know if you would like me to use

in the future episode. I only do it if you tell me to Otherwise, if you for you can hop on over to Twitter and send me a message. The handle for the show is tech Stuff hs W and I'll talk to you again really soon. Yea. Tech Stuff is an I heart Radio production. For more podcasts from my heart Radio, visit the i heart Radio app, Apple Podcasts, or wherever you listen to your favorite shows.