Top tech startup news for Wednesday, March 29, 2023: Apple, Beaxy, Binance, OpenAI, and Salt Labs
Good evening! Below are some of the top tech startup news stories for Wednesday, March 29, 2023.
Elon Musk and other tech leaders call for a pause on the ‘dangerous race’ to make A.I. as advanced as humans
Elon Musk joined other technology leaders on Tuesday to call for a pause on training AI exceeding GPT-4. Citing “risks to society,” Elon Musk and other tech titans called for a pause on advanced AI systems that exceed the current OpenAI GPT-4. In an open letter signed by Musk and Apple co-founder Steve Wozniak, tech leaders are calling for a six-month pause to the development of systems more powerful than OpenAI’s newly launched GPT-4.
“OpenAI’s recent statement regarding artificial general intelligence, states that “At some point, it may be important to get independent review before starting to train future systems, and for the most advanced efforts to agree to limit the rate of growth of compute used for creating new models.” We agree. That point is now.”
The leaders added: “Therefore, we call on all AI labs to immediately pause for at least 6 months the training of AI systems more powerful than GPT-4. This pause should be public and verifiable, and include all key actors. If such a pause cannot be enacted quickly, governments should step in and institute a moratorium,” said the letter issued by the Future of Life Institute.
“AI systems with human-competitive intelligence can pose profound risks to society and humanity, as shown by extensive research and acknowledged by top AI labs.” In response to a post on Twitter, Musk said: “Leading AGI developers will not heed this warning, but at least it was said.”
ChatGPT has grown in popularity to millions of users within just a few months of its launch. Just two weeks ago, OpenAI launched the latest version of its primary large language model, GPT-4, which the company claimed can beat 90% of humans on the SAT. Unlike its predecessors, OpenAI said the new GPT-4 is a large multimodal model that can solve difficult problems with greater accuracy, adding that GPT-4 is the company’s most advanced system to date, producing safer and more useful responses.
Crypto investors withdrew $1.6 billion from Binance over fear the crypto exchange may be the ‘next shoe to drop’
Crypto investors withdrew $1.6 billion from Binance in just 48 hours after the world’s largest crypto exchange and its founder were sued by the U.S. Commodity Futures Trading Commission (CFTC) for operating what the regulator alleged were an “illegal” exchange and a “sham” compliance program.
According to data from the blockchain data tracker Nansen, Binance has seen $1.6 billion of overall withdrawals since the lawsuit was filed and $852 million in the last 24 hours alone. The withdrawals were a step up from the average of $385 million per day the crypto exchange has experienced over the last two weeks.
CFTC said it’s seeking “disgorgement, civil monetary penalties, permanent trading and registration bans, and a permanent injunction against further violations of the CEA and CFTC regulations, as charged.”
As you may recall, early this month, investors withdrew about $6 billion from Binance’s stablecoin after the US crackdown on the exchange. According to the data from market tracker CoinGecko, Binance’s stablecoin, Binance USD, saw around $6 billion of outflows following a U.S. regulatory crackdown on the company that issues the token.
Meanwhile, Martin Lee, a research analyst at Nansen, added that the current outflows were higher than usual, but still far off from a record high of December 13, when investors pulled $3 billion from Binance as they grew weary about the state of Binance’s reserves.
The withdrawals further reinforce the lack of investors’ faith in crypto exchanges amid the ongoing chaos in the industry. The collapse of Terra Luna and San Bankman-Fried crypto exchange FTX continues to ripple across the crypto market. Is Binance next?
Apple launches Pay Later service
Apple finally jumped on Buy Now, Pay Later (BNPL) bandwagon to take on PayPal, Klarna, and Affirm. The iPhone maker announced on Tuesday finally the launch of its highly-anticipated Apple Pay Later service, which enables users to split purchases into four payments spread over the course of six weeks with zero interest and no fees
The news comes a year after Apple quietly acquired London-based fintech startup Credit Kudos for $150 million as part of its push to dominate the payments space. The Apple Pay Later service is part of the tech giant’s push into the lucrative BNPL market.
The Apple Pay Later interface is shown on iPhone 14.
In a statement, Apple said that Apple Pay Later will “allow users to split purchases into four payments, spread over six weeks with no interest and no fees.” Additionally, Apple Pay users can easily track, manage, and repay their Apple Pay Later loans in one convenient location in Apple Wallet.
In addition, individuals can apply for Apple Pay Later loans of $50 to $1,000, which can be used for online and in-app purchases made on iPhone and iPad with merchants that accept Apple Pay. “Starting today, Apple will begin inviting select users to access a prerelease version of Apple Pay Later, with plans to offer it to all eligible users in the coming months,” Apple said in a news release.
The Apple Pay Later service is offered through the Mastercard Installments program, so merchants that already accept Apple Pay will not need to make any changes to implement the software for their customers.
“There’s no one-size-fits-all approach when it comes to how people manage their finances. Many people are looking for flexible payment options, which is why we’re excited to provide our users with Apple Pay Later,” said Jennifer Bailey, Apple’s vice president of Apple Pay and Apple Wallet. “Apple Pay Later was designed with our users’ financial health in mind, so it has no fees and no interest, and can be used and managed within Wallet, making it easier for consumers to make informed and responsible borrowing decisions.”
Salt Labs raises $10M in pre-seed funding to enable hourly workers to earn rewards for every hour worked
New York-based fintech startup Salt Labs has closed a $10 million pre-seed funding round led by Fin Capital. In conjunction with the funding, Salt Labs also announced that Logan Allin, Managing Partner and founder of Fin Capital has joined its Board of Directors, along with media veteran Gary Ginsberg, who is also joining Salt Labs’s board as an advisor.
Salt Labs was founded by Jason Lee and Rob Law who previously co-founded unicorn company DailyPay which created the on-demand pay industry to address income inequality for hourly workers.
Set to launch this spring, the Salt platform will provide contract workers with the opportunity to earn rewards for every hour worked. These rewards can be redeemed for goods and experiences, much like other rewards programs, or transferred to family and friends.
Commenting on the funding, Logan Allin, Managing Partner and founder of Fin Capital said, “We back repeat founders and having collaborated successfully with Jason and Rob at DailyPay, we are thrilled to support them in building Salt Labs – the future of worker equity.”
Salt Labs CEO Jason Lee said: “Fin Capital was an ideal partner for us given their full life cycle investment strategy. We are looking forward to partnering with them from pre-seed to IPO. We are also excited that 100% of our institutional investors are DailyPay investors who have backed us before.”
SEC shuts down Beaxy crypto exchange, founder sued for SEC violations
Beaxy crypto exchange is the latest casualty of the ongoing chaos in the crypto industry. Beaxy officially closed its doors after the U.S. Securities and Exchange Commission (SEC) charged the company with violations.
The SEC charged Beaxy and its executives for operating an unregistered exchange, brokerage, and clearing agency simultaneously, making it the first cryptocurrency platform to be shut down by the agency.
In a statement on Wednesday, the agency for failing to register as a national securities exchange, broker, and clearing agency.
The SEC also charged Beaxy founder, Artak Hamazaspyan, and a company under his control, Beaxy Digital, Ltd. for conducting an unregistered offering of the Beaxy token (BXY) and raising $8 million. Additionally, the agency also said that Hamazaspyan “misappropriated at least $900,000 for personal use, including gambling.” Lastly, the SEC has charged market makers who were operating on the Beaxy Platform for acting as unregistered dealers.
According to the SEC’s complaint, Windy Inc. took over the Beaxy platform in 2019 after the founder misappropriated money, and managers Nicholas Murphy and Randolph Bay Abbott maintained Beaxy for trading crypto assets “that were offered and sold as securities,” the SEC added.
The complaint also alleges that Windy, through the Beaxy Platform, violated the Securities Exchange Act of 1934.
“When a crypto intermediary combines all of these functions under one roof – as we allege that Beaxy did – investors are at serious risk,” Gurbir Grewal, the SEC’s enforcement chief, said in the statement. “The blurring of functions and the lack of registrations meant that regulations designed to protect investors were not followed or even recognized by Beaxy.”
Meanwhile, Beaxy said on its website that it was suspending its operations because of the “uncertain regulatory environment surrounding our business.”