Heat is on Celsius from crypto

Temperatures are expected to surpass 30 degrees Celsius in the UK this week, but the heatwave du jour is the meltdown in cryptocurrencies and the hot blast from it that crypto lender Celsius is suffering.

Celsius froze withdrawals early on Monday, saying it was acting for the “benefit of our entire community in order to stabilise liquidity and operations while we take steps to preserve and protect assets”. Its own coin, known by the ticker CEL, has lost half its value in the past 24 hours, according to CryptoCompare data.

Celsius is one of the biggest players in the market for digital yield products, providing users with the ability to lend out their tokens as collateral for other crypto projects. But the collapse of the terra and luna tokens saw the value of assets deposited with Celsius fall by more than half to less than $12bn, between late December and mid-May.

Alphaville says another crypto sell-off over the weekend meant that “Celsius was forced to gate either because it was functionally insolvent (ie, unable to pay debts as they fall due) or balance sheet insolvent (ie, unable to pay debts whenever they fall due)”.

The sell-off was the result of a more aggressive pace of Federal Reserve tightening being anticipated by markets, after Friday’s data showed US inflation jumped to a fresh 40-year high in May. Risky cryptocurrencies are going out of fashion as a result and bitcoin has fallen nearly 20 per cent over the weekend to under $25,000, with Celsius’s predicament compounding negative sentiment.

Regular markets are also entering bear territory, with Wall Street’s S&P 500 index falling 2.4 per cent at the open on Monday and the tech-heavy Nasdaq dropping 2.9 per cent. Shares in MicroStrategy, the software company that had been buying bitcoin aggressively, are down more than 20 per cent so far today.

The Internet of (Five) Things

1. Has Google’s LaMDA passed the Turing test?
Google has ignited a social media firestorm on the nature of consciousness after placing an engineer on paid leave who went public with his belief that the tech group’s chatbot has become “sentient”. Lex says the uncanny brilliance of natural language processing (NLP) evidently spooks tech bosses.

2. Drugmakers sentient of AI start-ups
Start-ups promising to use artificial intelligence to transform drug development are raising hundreds of millions of dollars and signing deals with Big Pharma, despite the recent sell-off in biotech stocks.

3. Google settles over underpaid women
Google has agreed to pay $118mn to settle a class-action lawsuit alleging the tech giant had systematically underpaid women in California, in violation of state law. Google has also agreed to have a third-party expert analyse the group’s hiring practices and for a labour economist to review its pay equity studies.

4. Selling a steak in Chinese edtech
Chinese edtech company New Oriental has discovered a workaround to survive Beijing’s ban on companies profiting from teaching school curriculum subjects — by combining language classes with product sales. Teachers using English lessons to sell steaks have become a viral hit, with clips of classes offered by New Oriental teachers jumping to the top of ByteDance’s Douyin app, TikTok’s sister app in China.

5. Bravo gets Anaplan cheaper
Take note, would-be Twitter acquirer Elon Musk. Thoma Bravo has successfully pressured software company Anaplan to cut the $10.7bn price at which it is selling itself to the private equity firm. Thoma Bravo had asserted that the company had violated its merger agreement by overpaying new workers, leading the enterprise software group to agree to a 3 per cent reduction in the price of the buyout.

Tech week ahead

Monday: Business software and services provider Oracle reports quarterly results. London Tech Week begins.

Wednesday: China’s Huawei begins its annual two-day developers’ conference.

Thursday: Creative software maker Adobe reports quarterly earnings. The Next Web’s annual conference starts in Amsterdam.

Tech tools — House-trained pet tech

Petlibro’s Granary WiFi feeder ($90) means you can maintain the strict dining regimen you established for your furry friend while working from home even as you head back to the office, writes Jamie Waters. With slick looks recalling an espresso machine, this upright feeder — the second-generation model from Petlibro — comprises a canister fixed to a bowl. After you’ve loaded it with kibble — it works with dry food — the fun begins. Everything is scheduled through buttons on the machine (which can be a little finicky) or via an app. And you can make an audio recording so that your voice announces each meal. It’s one of five essential pet gadgets covered by Jamie.