Each Friday, Farhad Manjoo and Mike Isaac, technology reporters at The New York Times, review the week’s news, offering analysis and maybe a joke or two about the most important developments in the tech industry. Farhad is off this week, so Nathaniel Popper, a Times tech and finance reporter, is filling in for him. Want this newsletter in your inbox? Sign up here.
Mike: Why, hello there, new newsletter partner! It’s everyone’s favorite Bitcoin reporter, Nathaniel Popper! Thanks so much for subbing in for Farhad this week, sir, while he’s off doing whatever it is he does when he’s not being wrong about technology in this newsletter.
Nathaniel: It’s good to be here to share some of my own wrong thoughts, Mike. I’ll see if I can do my best Farhad imitation, but with the added bonus of lots of tangents about Bitcoin and fintech.
Mike: Indeed. Well, it’s nice to have a finance expert join the tech pod and tell us all the ways that technology is changing how we bank and pay for things and all that stuff I barely comprehend.
Mike: Anyway, let’s get on to talking about the week in tech! And with that, why don’t we start off with Bitcoin? Square, the micropayments processing company co-founded by Jack Dorsey, recently started letting a small subset of users purchase Bitcoin using one of the company’s consumer-facing apps, Square Cash. It’s primarily a peer-to-peer money transfer service, but Square is dabbling in ways to make money from the app.
Now, you’ve written a bit about Square over the past year, including how the company was set to surge past the market cap of Twitter, Dorsey’s other beloved company. What should I make of this move? Is it something significant for the business or, alternately, is it a significant moment for Bitcoin? With all the daily vacillations in Bitcoin value, it’s hard for me to know if the currency is in a stable, real place with normal people or if it’s still a flight of fancy.
Nathaniel: Square’s stock jumped after this Bitcoin news got out. It reminds me a bit of the British company that saw its shares jump 400 percent last month after it simply added the word “blockchain” to its name. (For those tech readers who have successfully ignored all of this craziness, blockchain is the database technology that Bitcoin introduced.)
It seems hard to dispute that this is a very bubble-y moment for Bitcoin and all the blockchain and virtual currency stuff that have spun off it. A lot of the people buying right now probably don’t have a terribly strong thesis about why the technology matters — they just see it going up and want to get in on the action.
Bitcoin’s position as a new kind of global online gambling parlor has been particularly apparent in South Korea and Japan, which have risen out of nowhere over the last six months to become the largest markets for virtual currency trading. When I was asking around about this a few weeks back, I kept hearing how virtual currency trading fit neatly in countries where ordinary people have long speculated on foreign currencies. It’s worth keeping this in mind for anyone thinking of buying a Bitcoin through Square Cash.
Even the speculation, though, points to one of the things that has gotten real technology people so excited about Bitcoin. Here is a new kind of digital investment that anyone in the world can access and buy and that can cross global borders without needing to go through banks.
Jack Dorsey hasn’t hidden his interest in this. Back in August, he used an event at the Computer History Museum to reveal his fascination with Bitcoin and the blockchain and his belief that it’s going to lead to some fundamental changes in how money works. I would bet that this trial on Square Cash is just the first baby steps in some bigger moves the company has planned.
Mike: I should probably try to find that random Bitcoin I purchased a few years ago on a whim. If only I remembered where I put that wallet.
Mike: Moving on, let’s head over to the world of Twitter, everybody’s favorite dysfunctional social network.
First, it spent a brutal week testifying in front of Congress about how Russians used social media to influence the 2016 presidential election. Then, a rogue employee decided to delete President Trump’s account for 10 minutes, sending the internet into a fit.
Now, Twitter is making some changes to its verification program. You know that little blue badge that some people have on Twitter, signifying that they have been “verified” to be who they say they are? Well, Twitter thinks it needs an overhaul.
The badge had become something of a status symbol. But then people started pointing out that avowed white supremacists had become verified, and people argued that Twitter was giving a tacit seal of approval to racist speech or the people behind it.
This week, the company rescinded some of the badges to people it said “break the company’s rules,” though Twitter didn’t go into detail. Now, some prominent white supremacists are up in arms about being targeted on the service. I imagine they’ll have another few days of furor over this one.
The company says it is also rethinking how verification should work in the future. I always thought being verified was sort of silly, even though I admit I have a little blue badge as well. It seems like the whole program really isn’t worth the headache to me.
Nathaniel: It really seems like a bit of a no-win situation for Twitter to me — like so many of the battles around the social media sites these days. For much of the last year, they’ve been getting in trouble for not doing enough to stop bot accounts and fake news. Then they have this one program where they are actually trying to verify things, and that gets them in trouble as well. Didn’t Facebook confront something similar when they took on the fake news problem by adding human editors to their news feed?
For Twitter, though, I have to imagine that part of the problem comes from how unevenly it applied those blue badges. You are a New York Times reporter with a badge; I am one without. I can appreciate why you have one, with your vast following and groupies — but the whole thing does feel a bit haphazard and unevenly applied. It does seem like you’d want some sort of guidelines around how the system works.
The whole thing made me think that if I were Jack Dorsey, I’d want to leave my job at Twitter and just go sell Bitcoin at Square. What a headache. And only the latest of many for Twitter.
Mike: Indeed. Though on a positive note, Twitter is trying to ramp up its data business, an area of the company’s revenue that historically hasn’t gotten much attention. Perhaps they’ll be in luck for this one. Anyway, thanks for coming on and making me smarter about fintech and Twitter! Please come back any time, especially when I start buying large quantities of Dogecoin.
Nathaniel: I’ll only come back if you promise you won’t do that.
Mike Isaac covers Facebook, Uber and Twitter for The Times. Nathaniel Popper writes about the intersection of technology and finance. You can follow them on Twitter here: @nathanielpopper and @MikeIsaac