Liquidators Of Sam Bankman-Fried’s Alameda Research Have Scavenged $110 Million Of Bitcoin After Losing Billions BtcCasey May 31, 2023 Analysis by Arkham Intelligence indicates that Alameda's liquidators have managed to acquire slightly more than 4,000 bitcoin. ------------------------------------------------ Liquidators in charge of the recovery of assets for the now-disgraced Alameda Research [1] hedge fund founded by Sam Bankman-Fried currently control over $110 million worth of bitcoin held in various wallets, according to a report supplied by blockchain analysis firm Arkham Intelligence [2]. These wallets have been receiving BTC from exchanges and cold wallets as recently as March 2023, the report revealed. The aggregation of these wallets provides insights into the liquidators' collection of BTC from Alameda's holdings. A recent transaction in April involved a 1 BTC test from Alameda's Merchant wallet. This BTC was later sent to a holding address now under the control of Alameda's Liquidators, known as 'Alameda Merchant 1.' Since the beginning of 2023, this address has accumulated 3,581 BTC, worth approximately $97.19 million at current prices. The report states that “In total, Alameda’s liquidators have managed to secure 4,083 BTC (currently $110.81M) sourced from: • Other Alameda Wallets: 34.94 BTC (currently worth $948.27K) • Deribit: 467.366 BTC (currently worth $12.68M) • WBTC Custodian: 2997 BTC (currently worth $81.34M) • Bitfinex: 298.027 BTC (currently worth $8.09M) ° Unlabelled Wallets (possibly an Exchange): 286.7 BTC (currently worth $7.78M)” image [A screenshot from the provided report.] “However, this is only a fraction of the BTC that Alameda controlled in the past,” the report noted. “Wallets connected to this network of Alameda’s BTC activity were worth at peak over $800M, with Alameda likely holding more BTC in Centralized Exchanges or unlinked Cold Wallets.” Arkham Intelligence stated that it will continue to monitor the on-chain activity of Alameda’s liquidators. ------------------------------------------------ Links: [1] [2] ------------------------------------------------
Did The New York Times Publish Manipulated Footage Of A Bitcoin Mine? Level39 May 31, 2023 Footage accompanying a New York Times article critical of Bitcoin mining appears to have been manipulated to reinforce the paper’s bias. This is an opinion editorial by Level39, a researcher focused on Bitcoin, technology, history, ethics and energy. ---------------------------------------------------------------------------------------------------- Did The New York Times manipulate aerial drone photography for its recent article attacking Bitcoin mining, in order to make the air in Rockdale, Texas appear smoggy? On April 9, 2023, the paper published its article, "The Real-World Costs Of The Digital Race For Bitcoin[1]," which included attacks on Bitcoin miners who purchase energy through sanctioned demand-response programs [2] within the state’s energy grid. image [Sources: Twitter[3], nytimes.com[4]] The article featured a sweeping hero video banner [5], which was also used as a still image for social media sharing, showing smog-filled aerial drone footage [6] over operations run by Bitdeer, a Bitcoin mining company that occupies a previously-abandoned aluminum smelting plant on the outskirts of Rockdale. However, evidence suggests that the footage may have either been manipulated [7] or lacks the necessary color grading that would have maintained photojournalistic integrity and adhered to ethical standards. Links: [1] [2] [3] [4] [5] [6] [7] ---------------------------------------------------------------------------------------------------- Color Histograms And Image Manipulation Color histograms are useful for analyzing the exposure and color balance of an image [1]. A color histogram is essentially a bar chart where the left side of the x-axis is black and the right side is white. The y-axis represents the number of pixels found in the image, for each part of the tonal scale between black and white. A properly exposed photograph, where the full spectrum of tonal blacks and whites are naturally found in a scene, will have pixels that span across the entire x-axis, from left to right [2]. When color data fails to span the entire x-axis, it can show that either those tones were entirely unavailable to the camera sensor, or that manipulation was performed to purposefully omit those colors. In the side-by-side comparison below, the color histogram in the aerial footage published by the Times [3] (left) has no pixels approaching the black point. This is particularly strange for footage that has bright sun and stark shadows that are clearly visible as the camera moves over the scene. When color parameters are enhanced and corrected (as shown below in the version on the right), a brighter and more stunning scene emerges. image [The color histogram [4] for the image on the left, featured on The New York Times’ [5] website, has a distinct gap between its color data and its black point, possibly indicating either an improperly exposed image [6] or manipulation to add a smog effect [7]. The photo on the right has been color corrected, showing a normalized histogram with the full range of colors and indicating that the Times’ version seems to have been altered for effect.] The hazy footage used by the Times may give readers a false impression that rural Texas air has been polluted by Bitcoin mining. Bitcon mines are fully electrified and, like electric vehicles [8], the mining facilities photographed by The Times have zero Scope 1 carbon emissions. In other words [9], there are no direct greenhouse (GHG) emissions [10] that occur from sources that are controlled or owned by the operators of the mines. Any indirect Scope 2 emissions [11] associated from mining’s energy use comes from the grid’s normal emissions. Links: [1] https://www.bhphotovideo.com/explora/photography/tips-and-solutions/how-to-read-your-cameras-histogram [2] [3] [4] [5] [6] [7] [8] [9] [10] [11] ---------------------------------------------------------------------------------------------------- Reply Hazy, Try Again The alleged manipulation appears to have been indirectly confirmed by Jordan Vonderhaar, the freelance photographer who took the aerial footage in question. Vonderhaar published another photo from the same drone [1] flight on his personal website [2], showing that the weather was perfectly clear within moments of the hazy photo published by the Times. This clear photo, from a different angle, indicates that the missing color data in the hazy photo was not due to weather conditions. image [Vonderhaar published a clear weather photo on his personal website [3], taken within minutes [4] of the photo that showed smog surrounding the same Bitdeer mine.] Vonderhaar's clear and sunny photo was also featured on the front page of the Times’ print edition [5] (from April 11, 2023), with a color histogram that had similarities to the one found in the smoggy photo — another extended black point. Normalizing the black and white points on Vonderhaar's portfolio image reveals vibrant colors and a sunny morning in Rockdale. Notice in the side-by-side comparison below that the Times intentionally cropped out some of the blue skies when it published this particular shot: image [The image on the left was published on the April 11, 2023, front page of the Times’ print edition [6]. In addition to cropping out the blue skies, it appears to have had its black point extended, to wash out colors, as evidenced by the gap [7] between the color histogram data and the black point. Normalizing [8] the color histogram (right), brings out the full color spectrum.] Vonderhaar’s photo on his portfolio site included full Exif metadata [9] that shows details about the imaging, such as the fact that it was taken on the morning of February 28, 2023, at 8:02 a.m. in raw [10] format, with a DJI FC220, the camera supplied by the DJI Mavic Pro drone [11]. Analysis of the shadows in the photo not only confirms this timing, but further analysis also indicates that the smoggy video footage [12] was taken only nine minutes after [13] the photo that showed clear and smog-free air surrounding the mine. Yet, the golden hues from the morning sunlight and blue skies are completely missing from the hazy hero footage. That a perfectly gorgeous moment in Rockdale could suddenly become hazy, at all altitudes and distances only nine minutes later, is nearly impossible. image [Footage filmed nine minutes apart shows both clear weather and smog. Photos by Jordan Vonderhaar (top, middle), Shademap [14] (bottom), via @yeolddoc [15].] Responding to allegations of manipulation, Vonderhaar — who described miners as “massive polluters [16]” — publicly stated on Twitter [17] that, “Nothing about the footage was doctored. It’s humid most mornings in Texas and when the sun rises you get low level haze. This is very common.” Leaving aside for a moment that Vonderhaar appears to be admitting that he was perhaps intentionally seeking out hazy weather for his photojournalistic spread, the nearest automated weather observation station [18], located at Hearne Municipal Airport — 40 miles to the Northeast [19] and well out of view of the aerial photography — reported low-level fog [20] at that same moment. Indeed, Vonderhaar's clear and sunny photo shows low-level fog on the distant horizon, many miles beyond Alcoa Lake. “Low-level” fog is not a high-altitude phenomenon, and sure enough, Vonderhaar's photo shows blue skies in the upper atmosphere and golden hues that are conspicuously missing in his smoggy footage, taken a few minutes later. ---------------------------------------------------------------------------------------------------- Links: [1] https://archive.ph/QVUQ9 [2] [3] [4] [5] 📄.pdf [6] 📄.pdf [7] [8] [9] https://archive.is/Bqamk [10] [11] [12] [13] [14] [15] [16] https://twitter.com/jordan_vondy/status/1645446668635058176 [17] https://twitter.com/jordan_vondy/status/1645455851006640130 [18] [19] [20] ---------------------------------------------------------------------------------------------------- Problems Uncovered Rory Highside [1] — a VFX artist who has expertise in CGI video effects [2] — was among the first to notice problems with the footage that the Times had used. Analyzing the video and color histograms, Highside suspected that either the color grading was mishandled or the color balance had been manipulated [3]. One of the most noticeable issues was that the “black point” was extended, which is indicative of footage that is washed out [4]. This was evidenced by the fact that, as colors approached black, there was a noticeable and unnatural gap between pitch black and the available color data where darker colors should be. Vonderhaar did not respond to these allegations on Twitter, and did not respond to questions about them by email. image [Analysis by Rory Highside [5] of Vonderhaar’s Times footage.] Links: [1] [2] [3] [4] [5] ---------------------------------------------------------------------------------------------------- The Hazy Truth Of Photojournalism Determining truth in photojournalism is a murky endeavor. The raw footage captured by professional-grade digital cameras can be thought of as the digital version of undeveloped film. Camera sensors capture raw data, which retains maximum image information and flexibility [1] during post-processing, but requires processing and interpolation to produce an accurate final image. The photographer must adjust various parameters, such as contrast, white balance, exposure, and color saturation — meaning the photographer always has some artistic leeway in the final product. Color manipulations are trivial adjustments in post production. It only takes one slight adjustment [2] to wash out an image. Minor adjustments are very common, and typically not an issue. But, at the end of the process, photographers have to walk a fine line between ​​enhancing an image for visual impact and maintaining its authenticity. Links: [1] [2] ---------------------------------------------------------------------------------------------------- Unedited Raw Drone Footage Is Visibly Hazy There is perhaps an alternate explanation for why Vonderhaar’s video footage was so hazy and lacking in contrast, while his still photograph taken nine minutes earlier was sunny and cinematic. The FC220 camera on Vonderhaar’s DJI Mavic Pro drone is capable of capturing video footage in a logarithmic (log) color profile [1]. Raw log footage is a flat and low-contrast format — not intended for publishing — that preserves a wide dynamic range of details, which allows for greater flexibility during post-processing. Much like how negative film [2] has inverted colors that enable positive images to be developed, log video footage always appears hazy when its raw, unedited format isn’t properly color graded [3].It would be the photojournalist’s responsibility, then, to accurately map to the colors they witnessed in real life. image [DJI drones can record in a logarithmic (log) color profile, which appears hazy if it isn’t color graded in post-processing [4]. Source: “Shooting In D-Log - DJI Mavic Pro [5].”] To convert log footage to an accurate color profile, a process called “color grading” or “color correction” is typically performed [6]. This involves adjusting the image's color and tonal properties to achieve a more visually pleasing and accurate representation of the scene. The proper conversion from log [7] involves mapping the tonal values in the log footage to their corresponding values, such as with lookup tables, or LUTS, to color grade the final footage. Vonderhaar could very well have been telling the truth when he claimed [8] that “Nothing about the footage was doctored.” Indeed, publishing unedited log footage without proper color grading would quite literally result in a misleading smog effect, without having to do anything. Doing this deliberately, of course, would be unethical if it intentionally misleads viewers into seeing smog that did not exist. Photojournalists have a duty [9] to maintain journalistic integrity and adhere to ethical standards to truthfully convey the events they witnessed. While there is no definitive "correct" color to any image, intentionally misleading readers by failing to color grade log footage is a breach of ethical standards. Photojournalists must depict the scene as faithfully as possible, avoiding anything that might distort reality. Publishing raw and uncorrected video footage, which actively removes colors from a scene and creates a misleading smog effect, is effectively a passive form of photographic manipulation. If not manipulation, then it is an egregious example of Hanlon’s razor [10]. It should be noted that Vonderhaar’s lack of color grading may not be due to malice or even artistic bias. While a professional photographer who has expertise in color correcting raw still images [11] to JPEG may possess a solid foundation in color correction and a good understanding of color theory, it does not automatically mean they have the necessary skills to color grade log video footage. Color grading log video involves a different set of skills and considerations [12] compared to color correcting raw still images [13]. Expertise in video editing software and a specific understanding of the technical aspects of working with video formats — such as frame rates, codecs and color spaces — is a requirement to adeptly work with log footage. Managing temporal continuity and ensuring consistent color grading is critical to maintaining visual coherence. It’s entirely plausible that Vonderhaar was simply unable to color grade log video. But, whether it be malice or inability, the Times should issue a correction. Links: [1] https://www.dpreview.com/articles/4978813437/how-to-shoot-log-video-using-dji-s-d-log-color-profile [2] [3] [4] https://www.dpreview.com/articles/4978813437/how-to-shoot-log-video-using-dji-s-d-log-color-profile [5] [6] [7] https://www.dpreview.com/articles/4978813437/how-to-shoot-log-video-using-dji-s-d-log-color-profile [8] https://twitter.com/jordan_vondy/status/1645455851006640130 [9] [10] [11] [12] [13] ---------------------------------------------------------------------------------------------------- The Signature Style Of The Times The Times has a signature style for its photographs [1], where it typically darkens images when it wants to portray a somber or moody tone. However, an extended black point — resulting in washed out colors — is the direct opposite of this iconic style. image [The Times’ signature photographic style [2] uses an extended white point that slightly darkens the image.] ---------------------------------------------------------------------------------------------------- Links: [1] [2] ---------------------------------------------------------------------------------------------------- The Ethics Of Photo Manipulation All photography requires some form of color correction. Minor stylistic choices aside, adjustments that actively mislead readers are unethical [1]. A 2015 article in the Times [2] about a World Press Photo research project, for instance, explained that photo editors cross an ethical line, which becomes explicit manipulation, when their processing obscures an image to create conditions that were not actually in the scene: “The only point at which processing becomes manipulation is when the toning is so great — usually by transforming significant parts of an image to opaque black or white — that it obscures substantial detail.” –“Debating The Rules And Ethics Of Digital Photojournalism [3],” The New York Times According to Highside, the extent of the manipulation and our ability to restore the full color potential will remain unknown unless Vonderhaar releases his original raw footage. The Society of Professional Journalists (SPJ) recommends in its code of ethics [4] that journalists need to be proactive about addressing concerns and allegations of improper conduct: “Ethical journalism means taking responsibility for one’s work and explaining one’s decisions to the public. Journalists should: Explain ethical choices and processes to audiences. Encourage a civil dialogue with the public about journalistic practices, coverage and news content. Respond quickly to questions about accuracy, clarity and fairness. Acknowledge mistakes and correct them promptly and prominently. Explain corrections and clarifications carefully and clearly. Expose unethical conduct in journalism, including within their organizations. Abide by the same high standards they expect of others.” –SPJ code of ethics [5] Despite the missing color data, which can only be sourced from Vonderhaar’s unreleased raw footage, Highside was able to partially restore the washed out footage to demonstrate what the imaging could have looked like if a proper color grading had been applied. The results are striking when compared alongside the video that was published by the Times: Intentionally deciding not to color grade or fully correct log footage is a breach of ethical standards in photojournalism. However, if it was due to lack of ability, it can still be considered a breach of ethical standards, particularly if the Times fails to correct the misinformation or take appropriate action to rectify the situation. A fundamental principle [6] of photojournalism is to provide an accurate and truthful representation of events. Misrepresenting the visual aspects of a scene goes against this principle and compromises the integrity of the profession. It undermines the credibility of photojournalists and the publication, it damages the reputation of the profession and erodes public trust in the media. It’s unclear why the Times is seemingly motivated [7] to deliberately portray Bitcoin mining in such a negative light. It appears to fit a long pattern of distortions and bias [8] from the newspaper, which has become more evident to readers in recent years. When the public is being misled by photojournalists into believing a small and rural Texas town has thick smog typically found in populated and polluted cities, it’s necessary and appropriate to question the paper’s ethical choices. Vonderhaar could clear up suspicions over his work by releasing the original raw log footage. This would allow members of the public to properly assess the color grading of the footage and reveal the true details that were present [9]. If indeed the log footage was intentionally left in a low contrast state, it would be an embarrassment for the Times. Links: [1] http://spj.org/ethicscode.asp [2] [3] [4] http://spj.org/ethicscode.asp [5] http://spj.org/ethicscode.asp [6] [7] [8] https://www.thegrayladywinked.com/ [9] ---------------------------------------------------------------------------------------------------- This is a guest post by Level39. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
Pro-Bitcoin Legislation Reigns Victorious In Texas This Year As The Legislative Session Ends BtcCasey May 30, 2023 In addition to the Texas bills, the latest proposed debt ceiling deal did not include the Biden Administration’s proposed 30% tax on Bitcoin miners. Bitcoin policy advocates celebrated several victories in the recent quarter, including the success of Texas SB 1929, a pro-mining bill, and the defeat of Texas SB 1751, an anti-mining bill. VP of Research at Riot Platforms Pierre Rochard expressed gratitude [1] to everyone involved, stating, "Texas will continue to be #Bitcoin country!" These legislative outcomes will contribute to the growth and stability of Bitcoin mining operations in Texas. As Brian Morgenstern, head of public policy at Riot Platforms reported [2], SB 1751 did not pass, ensuring the continuation of the state's usage of Bitcoin miners’ flexibility in balancing and stabilizing the power grid. In contrast, SB 1929 successfully passed, establishing a registration process for Bitcoin miners to share information with ERCOT, enhancing transparency and grid reliability. Additionally, HB 591 was approved, providing a tax incentive for utilizing gas that would otherwise be flared into the atmosphere for on-site Bitcoin mining, promoting emissions reduction. Another significant development was the passing of HB 1666, which introduced a proof-of-reserves regime, positioning Texas as a leader in building confidence within the digital asset ecosystem. These legislative achievements reflect the collaborative efforts of various stakeholders and industry participants, including Riot Platforms, The Texas Blockchain Council and the Chamber of Digital Commerce according to Morgenstern. In addition to these developments, public miner stocks also surged on the news that the U.S. debt ceiling deal may be finalized soon, and that it does not include President Joe Biden’s proposed 30% tax [3] on energy used for Bitcoin mining. While these successes mark important milestones, advocates acknowledge that their work is far from over. But the Bitcoin community remains optimistic about the future and the continued growth of the industry, with the positive outcomes achieved in Texas during this legislative session setting a favorable precedent for Bitcoin-related policies and innovation in the United States. Links: [1] [2] [3]
Paxful Announces Appointment Of Interim CEO Roshan Dharia BtcCasey May 30, 2023 Dharia will act as CEO as the exchange continues its transition from previous leadership under Ray Youssef. Paxful [1], a global peer-to-peer Bitcoin platform, has announced the appointment of Roshan Dharia as the new Interim Chief Executive Officer, effective immediately. This comes after a brief shutdown period [2] of the exchange prior to the departure of Co-Founder and former CEO Ray Youssef. According to a press release sent to Bitcoin Magazine, Dharia will be responsible for strengthening operations and exploring strategic alternatives for the company. With over eight years of experience, Dharia expressed his enthusiasm for the role, stating, "It's a great honor to become CEO of Paxful. Over the last eight years, Paxful has been a pioneer in establishing the real use cases of Bitcoin and helping millions of people in the process." Previously a senior executive at TrustToken (now known as Archblock), Dharia led the DeFi institutional lending business. He also founded and built the investment platform PTHL Affiliates, specializing in distressed private company acquisitions and turnarounds. Srinivas Raju, the Custodian of Paxful, expressed his confidence in Dharia's leadership, stating, "I'm delighted that Roshan has joined Paxful and will take over day-to-day management of the company. I'm confident under his leadership the business will keep building a financial system that truly serves the 100%." Youssef’s recent departure at Paxful was reportedly [3] a result of a feud involving a myriad of accusations and legal disputes with co-founder Artur Schaback, who is currently the COO of the exchange. Since its establishment in 2015, Paxful has experienced significant growth, attracting over 12 million users worldwide and facilitating billions of dollars in trades on its platform, according to the press release. Links: [1] http://paxful.com/ [2] [3]
Stablecoin Issuer Tether To Begin Bitcoin Mining Operations In Uruguay BtcCasey May 30, 2023 The company behind the most widely used U.S. dollar stablecoin is set to enter the mining industry through collaborations in Uruguay. Tether, the company behind the widely popular USD stablecoin, has announced its foray into energy production and sustainable Bitcoin mining operations in Uruguay. According to the announcement [1], Tether’s collaboration with a local licensed company marks the company’s expansion into the energy sector as part of its goal to become a global tech leader. By investing in renewable energy sources, Tether said it aims to support and promote sustainable Bitcoin mining, ensuring a “minimal ecological footprint while upholding the security and integrity of the Bitcoin network.” Paolo Ardoino, CTO of Tether, emphasized the company's commitment to renewable energy, stating, "Tether is proud to spearhead a movement that combines cutting-edge technology, sustainable practices, and financial innovation." Uruguay has gained recognition as a leader in renewable energy, with an impressive 94% of electricity generation sourced from renewable sources such as wind and solar power according to the announcement. The country's favorable conditions for renewable energy production, including wind farms, solar parks and hydropower projects, make it an ideal location for Tether's sustainable mining operations. The company also stated that Uruguay's robust and reliable grid system further ensures efficient and sustainable mining activities. Tether is actively seeking experts in the energy sector to join its team and contribute to this innovative project. For more information on Tether's energy initiative and potential career opportunities, interested individuals can visit their website at tether.recruitee.com/energy. [1] https://tether.to/en/tether-invests-in-energy-production-and-sustainable-bitcoin-mining-in-uruguay/