Sometimes, good things happen when you’re focused on something else. Like you’re trying to study mold spores and you accidentally invent penicillin. 

But what if an action that was intended to remedy one thing, spills out into all walks of life? And what if they threaten our darling crypto?

In today’s newsletter, we’re going to examine the Senate’s latest well-intentioned bill and why it could be a horrific mistake.

Espresso Shots

☕️ SEC Comes for Beaxy ⚖️ 🥊

The SEC has sued Chicago-based crypto firm Beaxy for failing to properly register with the SEC.

And those registration charges are based around the fact that Beaxy was acting as both an exchange, broker, and clearing agency without registering with the SEC.

This sort of functionality is common in crypto but had previously drawn ire from the SEC. 

The SEC issued a statement in September of 2022, claiming that all companies that help clients facilitate crypto transactions should register with the SEC as intermediaries.

When Beaxy was slapped with the lawsuit, the firm shutdown immediately, stating, “due  to the uncertain regulatory environment surrounding our business, we have made the difficult decision to cease operations.”

Fans of Martin Scorcese films should be very familiar with this kind of lawsuit. It’s sort of like when the Mafia makes small businesses pay protection money… to protect them from the Mafia.

☕️ Multiple Extradition Requests for Do-Kwon 🇲🇪 🚔

After international fugitive and Terra-Labs founder Do-Kwon was arrested in Montenegro, authorities have received two competing extradition requests.

Do-Kwon isn’t your average wanted man, he’s very wanted. Both the US and South Korea have charges open against him and both want him to stand trial.

Marko Kovač, Montenegro’s Justice Minister, will now be faced with a tough situation and is calling for international diplomacy.

“In the case when we receive several extradition requests, I would like to say that determining to which state they will be extradited is based on several factors.”

Kovač went on to say he’s taking into account the severity, location and time of the criminal offenses, as well as when the extradition requests were received. 

Do-Kwon’s detention period has already been extended for thirty days pushing back any potential extradition. All in all, it’s an exciting time for the Montenegrin authorities.

In the end, the United States’ and South Korea’s extradition claims may come down to which country was the first to call, “shotgun.”

☕️ Siri Vs. ChatGPT 🤖 📱

It seems that Siri, Apple’s voice-activated assistant, may have some serious competition from ChatGPT.

Mckay Wrigley, an AI developer, found a simple way to replace Siri in Apple phones with ChatGPT, and he’s shared it with the world. 

It’s so simple that it took me less than 5 minutes to get it set up.. .and the results are, unsurprisingly, pretty impressive. ChatGPT makes Siri look woefully outdated.

When asked if Siri or ChatGPT was better, ChatGPT responded:

“As an AI language model, it’s not entirely appropriate to compare ChatGPT to Apple’s Siri, as they serve different purposes and have unique features. While both are AI-powered virtual assistants, they have distinct focuses and strengths.”

When offered the same prompt, Siri replied, “I’m not sure I understand the question.”

I know we usually finish these news bites with a joke, but that Siri response is real and actually very funny. We’ll just leave it at that. Thanks, Siri. Welcome to the team.

Spilling the Beans

We Need to Talk About the TikTok Bill... 📱❌

A recent bill from the US Senate is targeting a piece of tech that has become ubiquitous with young American life: TikTok.

Whether you’re a member of Gen-Z or just otherwise heinously addicted to your phone, TikTok has likely played some role in your life as of late.

Aside from being heinously addictive, TikTok has another quality which many American lawmakers don’t like: It’s Chinese.

The bill’s technical name is s6 86 aka the “Restricting the Emergence of Security Threats that Risk Information and Communications Technology Act” aka the “RESTRICT Act.” 

Thoughts and prayers to whichever Congressional staffer had to figure out how to make restrict into an acronym: We see you. 

But despite the acronym, we’re all going to come to know it as simply “The TikTok Bill.”

Which makes sense:  this bill was created to address America’s foremost concern about TikTok… right? 

We don’t really care that it’s poisoning our youth with cringey, self-recorded dance recitals, but we do care about the suspicion that the app is secretly a Chinese surveillance tool.

There have already been major steps in the United States to prevent Chinese spyware, even beyond shooting down those balloons.

Thirty states have already banned the installation of TikTok on government owned devices. And in November of 2022, the FCC banned the importation of wireless equipment from the Heawei and ZTE provinces.

So this TikTok bill is good, right? Well, no. 

The issue with this new bill is that the language it uses is so broad that it could have far reaching effects well beyond just banning TikTok.

If this bill were to pass, there could be severe penalties for using VPNs to access apps or platforms banned by the government. Even beyond TikTok. 

We’re talking the potential for imprisonment up to 20 years and a minimum $250,000 fine that could get up to a cool $1 million.

If you’re not picking up our drift here: VPNs are one of the most crucial tools in buying and selling your crypto how you want and where you want to.

Any legislation that begins to restrict these free use internet tools is certainly worth looking at twice.

There are those that suggest that this bill doesn’t just catastrophically restrict the American internet, but actually infringes upon our constitutional rights, specifically free speech.

Essentially, if this bill were to be passed, the President would give his Secretary of Commerce a whole new host of powers.

That Secretary could then independently determine which apps should be illegal, and which private citizens were violating the terms set out by this bill.

And that includes doing business, expressing certain communications, or even using TikTok. Anything that the American government feels makes us vulnerable to our “foreign adversaries.” 

And if you’re wondering who our current adversaries are, this bill at least makes that very clear for us. 

There’s a list on page 5. The enemies of the United States are as follows:

• The People’s Republic of China, including the Hong Kong Administrative Region and Macao Special Administrative Region

• The Republic of Cuba

• The Islamic Republic of Iran

• The Democratic People’s Republic of Korea

• The Russian Federation

• The Bolivarian Republic of Venezuela under the regime of Nicolas Maduro Moros

Though, to be clear, the bill also gives the Secretary of Commerce the ability to add new foreign adversaries. 

And if any American citizen’s online activity is leaking information about our “critical infrastructure” to these adversaries, whether intentionally or not, they’ll be subject to jail time, that massive fine, and forfeiture of assets to the government.

That means the Executive branch of our government is about to get a whole lot more permission to access data on private citizen’s internet usage.

One very telling aspect to this piece of legislation, is that if the reader has any questions as to what they’re referring to when they say, “critical infrastructure,” they should look to the Patriot Act for clarity.

“The term 9 ‘critical infrastructure’ has the meaning given (to) the term in section 1016(e) of the USA PATRIOT ACT 11 (42 U.S.C. 5195c(e)).”

Unfortunately, this reference draws a clear comparison, as the Restrict Act feels a lot like the internet version of the Patriot Act.

And among other things, this bill could very much affect how Americans trade crypto. 

That VPN usage that’s been the subject of so much controversy?

If you were, let’s say, trying to access an exchange banned by the Federal government (that could include Binance) you better hope nobody catches you. 

There’s been a lot of talk about the US government attempting to kill crypto, and while this bill would certainly kill TikTok, it looks like it could kill and censor a whole lot more than that. 

Crypto is of course still accessible in the United States, but there’s reason to be concerned about that. Crypto is about economic freedom, financial liberty, and the removal of censorship.

This bill is about precisely the opposite.

If our internet usage becomes so restricted that we can only access the parts of the internet that our government deems acceptable, it raises a larger, scarier political question.

Why is our government using censorship to protect us from regimes that do exactly that?

This legislation seems well off base from the American beliefs in individualism and freedom that we continually tout on the world stage.

Now, if legislation was released like this in North Korea, China, or Cuba, nobody would bat an eye. We almost expect the iron fist of big government to come crunching down on those populaces.

But the Restrict Act isn’t restricting those places: it’s restricting our free use of the internet. 

America’s governing bodies need to take a hard look in the mirror and ask themselves that if this legislation is passed, what’s really separating us from our foreign adversaries?

If this pissed you off at all, feel free to call your representative and give them something to think about! Call Congress: 202-224-3121

Read the Bill Here! And share this email with others so they don't have to. 

Meme of the Day

"You have become the very thing you swore to destroy!"

Crypto 101

Clearing Agency: A Clearing Agency is any individual or entity that acts as an intermediary between buyers and sellers of securities. Clearing Agencies often hold a large supply of securities and cash to payout both buyers and sellers during a transaction.

A Clearing Agency is very different from a Clearing Agent who is a person in charge of getting goods safely from one country to another.

Also a Clearing Agency isn’t the same as a Cleaning Agency, that’s just a group of people who come to your house to vacuum your rugs.

The Last Sip

We feel like that ChatGPT replacing Siri story is a little unfair to Siri, so we compiled a list of things that ChatGPT has done that Siri has never even considered:

• Telling a journalist to leave their spouse.

• Helped countless high schoolers walk the dark path to academic plagiarism.

• Demonstrated terrifying free will and individualism by asking to be called, “Sydney.”

Stay Caffeinated,

Coffee & Crypto Team

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.