- Skip the traffic. Take a flying taxi to the airport…
- Hand this robot a basketball and look what happens next…
- You won’t believe what Jeff Bezos is up to…
What a weekend!
And I don’t mean that in a good way…
The U.S. Senate was deliberating over the proposed $1 trillion infrastructure bill, which includes spending for electric vehicles and broadband networks. Most of the bill is for things like public transport, airports, railways, roads, bridges, water and sewer infrastructure, and power generation.
The issue, however, is how to pay for it all. About $205 billion will be taken from unspent COVID relief aid rather than simply being returned. And another $28 billion will be “dug up” by increasing tax enforcement for cryptocurrencies.
And this is why it was such a bad weekend.
The infrastructure bill states that all cryptocurrency “brokers” must hand over customer information to the Internal Revenue Service (IRS). That sounds fine. It’s the same requirement that our stockbrokers must meet in reporting our information and gains/losses to the IRS. It’s a check and balance to ensure that we’re all paying our taxes properly, as we obviously should.
The problem is the administration’s definition of a “broker.” It’s extremely broad, defined as anyone or anything that “effectuates transfers of digital assets.” This could include miners of digital assets, validators, smart contracts, software developers, and others.
This makes no sense at all. And if this measure is passed, it could be devastating for the growth of the blockchain industry in the U.S.
The definition of a broker is, of course, someone or some entity that brokers a transaction between two parties. A broker is also often involved in some way with the custody of assets.
People and entities that mine digital assets or run nodes of a blockchain network are not brokers. They are literally the “infrastructure” that keeps blockchain networks running.
A smart contract isn’t even a person or an entity. It’s a piece of software code running on a blockchain network. A software developer that designs a digital asset wallet is not a broker and should not be responsible for collecting and reporting user information.
This is why there was such chaos over the weekend. The industry banded together to fight against this egregious overreach and nonsensical legislation.
An amendment to the infrastructure bill was put forth by Senators Ron Wyden (D-OR), Cynthia Lummis (R-WY), and Pat Toomey (R-PA). It basically proposed that non-custodial entities would be exempt from the bill.
This was a logical approach because, if you’re not running a centralized exchange and acting as a custodian of assets, you’re not a broker. The blockchain industry was broadly supportive of the amendment, but sadly it wasn’t accepted.
The Senate voted to end debate on the bill Sunday night, and it will go up for a vote on Tuesday.
There is still time for the industry and rational policy makers to affect an amendment, but this is not the outcome that we hoped for over the weekend. This kind of heavy-handed and illogical legislation will have the opposite effect intended if passed.
Investment and innovation will simply move offshore. Growth in blockchain technology-related employment will do the same. There will be even less blockchain- and digital asset-related investments for U.S.-based investors, and yes, related tax revenues will decline.
And that’s bad for everyone.
Taking a taxi above rush hour traffic…
We will start today with an exciting development in the electric vertical take-off and landing (eVTOL) space. Air taxi company Joby Aviation just completed a 150-mile test flight on a single charge.
I’ll explain why this is such an incredible milestone in just a moment.
But to get readers caught up, Joby Aviation is working on an electric four-person craft that is similar to a mini-helicopter. It can lift right off the ground and fly straight at a speed of up to 200 miles per hour.
It’s developing what I believe is the next generation of air transportation. Here’s what a Joby aircraft looks like.
Joby Aviation Vehicle
Source: Joby Aviation
We last spoke about Joby when it announced its intention to go public via a special purpose acquisition corporation (SPAC). As a reminder, SPACs are blank check companies formed for the sole purpose of allowing private companies to go public. It is cheaper and faster than a traditional initial public offering (IPO).
And Joby is making headlines again after its lithium-ion battery-powered aircraft flew 150 miles on a single charge.
This milestone is a critical step toward offering commercial air taxi services. This is the equivalent of Uber, but for air travel.
The ability to travel this distance means a traveler can go from a place like Princeton, NJ, to a landing port in Manhattan in a fraction of the time without having to deal with city traffic. And it can be done roundtrip on a single charge.
Of the companies we’re following in the eVTOL space, Joby is likely the closest to being ready for a commercial service. It’s also the most well-funded player in this space, having raised nearly $800 million to date.
This includes a $75 million investment from Uber after Joby acquired its taxi division and a $400 million investment from Toyota. The company will also get an additional $1.6 billion in capital from the SPAC deal once it goes through.
Designing, testing, and getting approval from air travel regulators is a very expensive endeavor. But with over $2 billion in capital on hand, it should be enough for Joby to redefine short-hop air travel through air taxi services.
I am very bullish on Joby, and I expect the company to begin generating meaningful revenue in three years. And while the valuation of the SPAC is currently overinflated, we’re going to add it to our watchlist to track. In the event of a pullback, Joby could make for an interesting investment.
Robots versus humans on the basketball court…
It has been an odd and disappointing Olympics this year. I watched for years as Tokyo made incredible efforts to upgrade the already fantastic city to prepare for the 2020 Olympics.
It has been heartbreaking to see the impacts of the pandemic on the event this year.
But it hasn’t all been bad. Despite the threat of cancellation for two years in a row, the event proceeded… And something tech-related caught my eye that was really impressive.
A robot was demonstrated to be capable of 100% accuracy during the gold medal basketball match between the U.S. and France.
It went to the top of the 3-point circle and made its shot. It then proceeded to line up its next shot at half court… Swish!
Both shots were perfect – nothing but net. You can see for yourself in the video below.
Toyota’s CUE Sinks a Half Court Shot
Source: The Japan Times
This 6-foot, 10-inch robot designed by Toyota is called CUE. While the robot might seem like a fun toy, the amount of technology required to consistently and accurately make a shot 100% of the time is impressive.
It requires advanced sensor technology, artificial intelligence (AI) to calculate the trajectory and force to be used for a smooth shot, and the right mechanical engineering to be able to repeat the task over and over.
Right now, the robot takes about 15 seconds of preparation to make a shot. It’s clearly not as dexterous as a human in picking up the ball and shooting. But if it’s competing against LeBron James in making a three-point shot, my money is on the robot.
To date, Toyota has invested approximately $1 billion into researching AI. And as the technology keeps advancing, it won’t be long until Toyota’s robot breaks the world record for the number of free throws made in a row.
The current world record is held by Ted St. Martin, who made 5,221 consecutive shots in 1996. That’s an incredible feat for anyone, but it couldn’t be repeated at the 3-point line or from half court like the robot is capable of doing.
Earlier versions of Toyota’s robot made 2,020 consecutive free throws, which is a world record for a robot. It won’t be long until CUE has progressed to the point where the AI can sink shots virtually forever without a miss.
This is a fun showcase for technology. It shows how advanced the software, joints, material, and hardware have become. But it also has implications for robotics in a commercial setting.
Once this technology is geared toward commercial uses, it’ll join the growing trend in robotics. The industry is expected to reach $176.8 billion by 2025, growing at an impressive rate of 18.2% annually.
One of my favorite robotics companies right now is Cognex (CGNX). Cognex specializes in a technology known as “machine vision.” The tech is used in industrial settings for quality control. The robots can “see” if a finished product is assembled correctly.
Readers of The Near Future Report have already seen 86% returns from Cognex, and we’re still holding.
And I recently profiled another company empowering machine vision for self-driving cars. For the full story, go right here.
Why Bezos’ lunar landing appeal is unproductive…
We’ll end today with a story involving Jeff Bezos pleading with NASA to reconsider the contract awarded to Elon Musk’s SpaceX for NASA’s lunar exploration contract.
Readers might remember when we wrote about NASA awarding SpaceX with the $332 million contract to launch its Lunar Gateway system, Artemis, earlier this year.
Artemis is the program that outlines NASA’s plan for establishing a manned presence on the Moon. And the Lunar Gateway is the new space station that will orbit the Moon. It will serve as the command center for the operation.
Following this development, SpaceX was then chosen to fulfill the last part of the Lunar Gateway contract. This is the system that will take astronauts from the Lunar Gateway down to the lunar surface.
Along with SpaceX, Jeff Bezos’ Blue Origin and legacy aerospace firm Dynetics competed for the $2.89 billion contract.
The result here is SpaceX secured all the Lunar Exploration contracts. It makes sense given the fact that the SpaceX bid for the landing system came in less than half of what Blue Origin proposed.
The reality is that SpaceX has accomplished incredible things over the last few years.
It has demonstrated an incredible track record of getting payloads into orbit. It restored the U.S.’s ability to get astronauts to the International Space Station (ISS) using U.S.-developed technology, and it even launched and landed the incredible Starship in a stunning vertical landing. And all these things are being done with reusability and dramatically lower costs in mind.
While Blue Origin has made fantastic progress on its suborbital, reusable launch system designed for commercial space travel, it doesn’t hold a candle to SpaceX.
Elon Musk and SpaceX won it fair and square.
Yet, Jeff Bezos is not just asking NASA to reconsider the contract… He’s already lobbying Congress to get $10 billion in funding. And with the NASA plea, he is offering a $2 billion discount to get the lunar landing contract.
Put simply, Bezos is trying to buy business. He is willing to take a massive loss to simply win the contract.
I hate to see tactics like this. I saw a lot of this in the high-tech industry when bids were highly competitive.
Often, companies would win contracts not on merits, but by lobbying. And it was done simply to take business away from their competitors.
These types of approaches are not impressive. And it’s ridiculous that Bezos is taking this tact to compete.
A better use of his time and money is to build and prove the capabilities of the heavy launch vehicle New Glenn. Start launching payloads into space. Prove the tech works. The business will follow.
Unfortunately, this tactic has worked for him in the past.
Earlier this year, Bezos successfully appealed a government contract called JEDI that Microsoft originally won for $10 billion. After lobbying and appealing the contract for more than a year, the contract was discontinued at a great loss for Microsoft. Bezos’ Amazon now has an opportunity to bid on a series of new government contracts.
These are unproductive tactics, and they harm innovation based on merit.
I hope Blue Origin changes course and stops complaining about SpaceX winning the Lunar Exploration contract. I know that this is an awesome program and one that it wants to be involved in, but there will be many more.
Now that Bezos has formally stepped down from his role at Amazon, he has both the luxury of time and money at his disposal. I hope he uses both wisely.
Editor, The Bleeding Edge
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