Dear Reader,
Last week, we had a look at the incredible $611 million cryptocurrency heist that took place on the decentralized finance platform, Poly Network.
It was one of the largest hacks in the industry’s history, and it was accomplished by a single hacker who had discovered a technical “bug” – kind of like a loophole – to appropriate the funds.
The hack was extremely insightful in that it highlighted and dispelled a common misunderstanding in the industry – that transactions are anonymous, and it’s easy to run off with funds from a hack like this.
Exactly the opposite is true. All transactions can be tracked. And while it’s easy to move cryptocurrencies around, getting those digital assets into a fiat currency is a completely different story. It is nearly impossible to do so without being caught.
And we saw this play out with the Poly Network hack. As of yesterday, the hacker has already returned almost the entire $611 million to Poly Network. But the hacker continues to hold the private keys for $200 million worth of the funds.
It’s not clear what his intentions are, but the hacker clearly wants to have leverage for some reason.
Other than that, all that is remaining is the $33 million worth of “frozen” tether associated with the hack. Tether, as a centralized organization, was able to lock them up. Even the hacker was unable to access them and return them to Poly Network. That task will have to be left to Tether to clean up.
Having come clean (almost) and returned the funds (with the exception of the private keys), something even more surprising happened.
Poly Network offered up $500,000 to the hacker for discovering the bug. That’s a bug bounty, which is common in the cybersecurity industry… Albeit, the $500,000 offer is a large one.
And unlike the cryptocurrencies involved in the hack, the $500,000 would be free and clear for the hacker to put to good use. No restrictions at all.
Better yet, Poly Network offered the hacker a job as its Chief Security Advisor.
This is a smart move by Poly Network. After all, it needs to get the private keys to unlock the remaining $200 million, and the hacker clearly has skills that would be an asset to Poly Network.
This kind of activity may seem disconcerting, but it self-corrects quickly. The blockchain industry is unique in this way.
Everyone realizes how quickly things are moving and that mistakes will be made along the way. It’s an amplification of the “fail fast” mindset that started at the beginning of the internet boom in the late ‘90s, which made Silicon Valley what it is today.
Only this time, the next generation of the internet, and the next generation of financial services, will emerge in a fraction of the time that it took to build the internet.
And I have no intention of my subscribers missing out on this once-in-a-generation “upgrade.” There won’t be a better window for extraordinary investment returns for decades.
That’s why I’m planning to share details about a critical blockchain upgrade that will usher in the next generation of currency, financial services… and a complete overhaul of the internet I’m referring to as “Web 3.0.”
It’s a strategy in the crypto and blockchain space that I’ve been researching for years… And on August 25 at 8 p.m. ET, I’ll finally share all the details on how you can profit from the next wave of digital assets. If you’re interested in joining me, you can RSVP to my event right here.
We are going to start today with some bizarre research coming out of Facebook’s laboratory. The social media giant is working on a technology called “reverse passthrough.” It’s for augmented reality (AR) and virtual reality (VR) headsets.
Reverse passthrough uses cameras and sensors inside of AR/VR headsets to track the wearer’s eyes and scan the face in real time. These scans create a digital representation of the wearer’s eye movements and facial expressions, which are displayed on the front-facing portion of the headset for others to see.
The idea here is that this will make the AR/VR experience acceptable in social settings. People can be around someone using a headset and still see their face.
This makes sense if we are moving toward a world where people will spend hours each day “living” and maybe even working inside a metaverse using AR/VR technology.
That said, this looks and feels awkward to me. And it’s quite possibly dystopian. In fact, I can’t help but think about George Orwell’s 1984. Have a look:
Reverse Passthrough Glasses… Or Dystopian Tech?
Source: Facebook
The image is a demonstration of Facebook’s reverse passthrough technology. We can see that the graphical display of the top half of this person’s face doesn’t exactly match the bottom half. Just looking at the image is off-putting.
The purpose of Facebook’s experimentation is to determine if there is a way to enable more natural interactions between people who are using virtual reality or augmented reality eyewear. They noticed that when a person who wasn’t wearing a VR headset interacted with someone who was, it was awkward.
So Facebook used cameras inside the VR headset and sensors to track facial expressions and eye movement in real time to recreate the user’s face on a forward-looking screen attached to the front of the VR headset.
While Facebook was able to get it to work, I must say this design makes me very uncomfortable, and I suspect I’m not alone.
That said, we shouldn’t dismiss it outright. I can envision a work environment where many spend hours a day working in a virtual environment, or in a metaverse.
Yet they will still have the need on occasion to speak with others in the real world. This kind of technology will enable a user to interact with someone one-to-one without having to take off their VR headset.
While this is still experimental, I’m curious to see if Facebook will incorporate reverse passthrough into its AR glasses, which I expect to be launched next year. Or perhaps the technology will make its way into a next-generation Oculus Rift VR headset.
When we last checked in on Niantic back in April, the company had just announced that it was developing its own AR glasses. This was a surprise at the time.
To bring newer readers up to speed, Niantic is the company that produced the wildly successful Pokémon Go game. This is the game that pioneered the concept of augmented reality as applied to smartphones.
The object of Pokémon Go is for players to find virtual creatures called Pokémon in their surroundings using their smartphone camera. When found, these creatures are displayed on the player’s smartphone within his or her surroundings.
When the game launched in 2016, smartphones had limited depth perception, so the augmentation was rather primitive.
But now that newer smartphones have advanced 3D-sensing technology – and in the case of the new iPhone, light detection and ranging (LIDAR) technology – Pokémon Go’s augmentation has become quite immersive.
Here’s a “before and after” comparison:
Pokémon Go’s Improved Augmentation
Source: Niantic
We can see how advanced 3D-sensing technology makes the augmentation more realistic. And it turns out that Niantic has an even bigger vision for how to leverage this technology…
Last year, Niantic acquired a company called 6D.ai. This is a company developing technology for creating a 3D mesh of the real world.
And Niantic just acquired another early stage company called Scaniverse. This company developed a mobile app that takes 3D scans of the real world using the LIDAR sensors employed in the new iPhones.
Niantic plans to combine the technology from these two acquisitions and integrate it into its library of AR games, including Pokémon Go and Harry Potter: Wizards Unite. In doing so, Niantic will be able to compile a very accurate 3D map of the world simply by capturing the 3D images produced by the people playing its games.
In other words, as players walk around their towns with their smartphones looking for creatures, Niantic will take the images produced and use them to create a 3D map of the world – all at no cost.
This is a brilliant move. A comprehensive 3D map of the world would form an incredibly valuable database.
Niantic could certainly use its map to create new games. It could also license the map to other companies. And games aren’t the only applications. Animated movies, historical reenactments, new VR-based social media apps, and all kinds of other applications could be created using a 3D map of the world.
And when Niantic has objects that it needs to capture anywhere in the world, it has the power to simply crowdsource the imaging by placing Pokemon in the needed locations. Think about that… It doesn’t cost Niantic anything to collect 3D images anywhere in the world. It just crowdsources the work for free.
So this is a big play by Niantic. I believe Niantic has set itself up to be one of the most valuable gaming companies in the world.
It’s already of the size and scale to become a public company, and with the real-world data, it has the potential to become much larger than just a gaming company.
It will have the ability to collect, mine, and monetize all the images and data that it collects from its users. It has the potential to become an absolute powerhouse. I just hope it doesn’t adopt the same business practices as Facebook and Google.
We’ll wrap up today with an exciting new product from OpenAI and GPT-3.
As a reminder, OpenAI started as a nonprofit research institute in 2015. Then it spun out a for-profit commercial arm in 2019.
And GPT-3 is OpenAI’s prized product. This is an AI-enabled text generator that has Silicon Valley humming.
At the simplest level, GPT-3 can complete our sentences as we type. But that’s only the start…
GPT-3 has written entire technical manuals. It can write short stories on command with only a small prompt like, “Bob went to the carnival and won a stuffed animal for his daughter.”
It’s an incredibly versatile AI. That prompted Microsoft to cut a deal with OpenAI for exclusive access to GPT-3’s source code. At first, this looked like a death knell for the technology, but fortunately, OpenAI can still build products using GPT-3. And that’s exactly what it just did.
OpenAI just released a new software product called Codex. This software leverages GPT-3 to produce computer code on demand using written commands. For example, users can type a command like “create a web page with X, Y, and Z characteristics” and Codex can generate the code for the desired website.
We can quickly see here how Codex can help non-programmers produce computer code quickly and easily. And that’s a tremendous value proposition given that there is a shortage of software programmers in the workforce right now.
What’s more, Codex can translate code from one programming language to another. This is an arduous task for even the most advanced computer programmers. Yet Codex can make it quick and painless.
Of course, there are all kinds of other applications for such an amazing tool as well. It can produce the code for virtually any function we can think of, as long as it is given the proper commands.
For this reason, Codex will help accelerate software development tremendously. And it can help both individuals and corporations get a lot more done in a short period of time.
So I’m very excited about this GPT-3-based product release. I look forward to testing out Codex myself. And we will continue to track OpenAI closely in The Bleeding Edge.
Regards,
Jeff Brown
Editor, The Bleeding Edge
P.S. Please don’t forget about my first-ever crypto livestream.
It’s happening next Wednesday, August 25, at 8:00 p.m. ET.
As I have mentioned several times in recent weeks, we have been hard at work researching the most explosive trends in the blockchain space. We have talked about non-fungible tokens (NFTs) quite a bit. There’s no doubt in my mind that NFTs are the future of the collectibles industry.
And that’s just scratching the surface.
What’s happening in blockchain right now is going to completely transform the internet. We’re talking about another Netscape moment here.
Think about it… how many people do you know who actually use blockchain technology daily? And I’m not talking about buying bitcoin on Coinbase. I mean actually using the technology in their everyday life.
My bet is very few. I certainly don’t know very many people who use the tech daily… and I’m an industry insider. But that’s all about to change.
The next generation of the internet is being built on blockchain technology right now. It’s all happening in plain sight.
The work that’s being done right now is setting the stage for mass consumer adoption of both the technology and the top crypto projects that are powering it forward.
Yet nobody realizes it.
For investors, that means it is like 1995 again. We have the chance to invest in projects that will give rise to the next group of trillion-dollar technology giants.
And that’s why it’s finally time for me to launch my own blockchain-based research service. I’ve been waiting patiently for the industry to finally get to this point… and here we are.
So I encourage all readers to join me for my crypto livestream next week. We are going to talk about the future of the internet. We will highlight the best crypto projects on the planet. And of course, I’ll share all the details about my new research service.
It’s all happening next Wednesday, August 25, at 8:00 p.m. ET. The event is free, so I just ask that readers reserve their spot in advance.
Ready to learn about our newest venture here at Brownstone Research? Just click here for crypto.
Like what you’re reading? Send your thoughts to feedback@brownstoneresearch.com.
The Bleeding Edge is the only free newsletter that delivers daily insights and information from the high-tech world as well as topics and trends relevant to investments.
The Bleeding Edge is the only free newsletter that delivers daily insights and information from the high-tech world as well as topics and trends relevant to investments.
