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Tesla will accept bitcoin when miners use clean energy

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Elon Musk, the CEO of Tesla.

Christophe Gateau/picture alliance via Getty Images

Tesla CEO Elon Musk on Sunday said the company will resume bitcoin transactions once it confirms there is reasonable clean energy usage by miners.

“When there’s confirmation of reasonable (~50%) clean energy usage by miners with positive future trend, Tesla will resume allowing bitcoin transactions.”

Musk was reacting to comments from Magda Wierzycka, CEO of South African asset manager Sygnia, who said that Musk’s tweets on bitcoin prices were “market manipulation” and should have triggered an investigation by the U.S. Securities and Exchange Commission.

Tesla revealed in an SEC filing in February that it purchased $1.5 billion worth of bitcoin and said it would begin accepting bitcoin as a payment method for its products.

However, the electric-car maker halted car purchases with bitcoin in mid-May due to concerns over how cryptocurrency mining, which requires banks of powerful computers, contributes to climate change.

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“We are concerned about rapidly increasing use of fossil fuels for Bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel,” Musk said in May.

On Sunday, Musk disputed Wierzycka’s allegations of market manipulation, explaining, “Tesla sold roughly 10% of its bitcoin holdings “to confirm BTC could be liquidated easily without moving market,” he said. During the first quarter, Tesla sold $272 million worth of “digital assets,” which helped it reduce operating losses by $101 million, the company revealed in its earnings statement.

Musk’s comments on social media about cryptocurrency often send prices soaring or plummeting, but appeared to have little immediate effect Sunday. Overall, bitcoin prices rose about 8% during the day.



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Navtej Sarna on future of Afghanistan, Quad

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U.S. Secretary of State Antony Blinken (L) meets Indian Prime Minister Narendra Modi at his Residence in New Delhi on India on 28 July, 2021.

Ministry of External Affairs, Government of India | Handout | Anadolu Agency | Getty Images

The United States and India have a shared interest in Afghanistan — and neither side wants the Taliban to take control of the country by force, a former top diplomat told CNBC.

“Both countries really want to work together to bring about an inclusive, secure (and) stable Afghanistan,” said Navtej Sarna said Thursday on CNBC’s “Street Signs Asia.” Sarna was the Indian ambassador to the U.S. from November 2016 to December 2018.

Afghanistan was one of several topics discussed Wednesday when U.S. Secretary of State Antony Blinken met Indian External Affairs Minister Subrahmanyam Jaishankar in New Delhi. Blinken also met Prime Minister Narendra Modi to talk about efforts to deepen bilateral ties.

Shared interests over Afghanistan

“India and the United States share a strong interest in a peaceful, secure and stable Afghanistan,” Blinken said at a joint press briefing with Jaishankar in New Delhi, according to a State Department transcript.

“There has to be a peaceful resolution which requires the Taliban and the Afghan Government to come to the table, and we both agree, I think strongly, that any future government in Afghanistan has to be inclusive and fully representative of the Afghan people,” he added.

From India’s point-of-view, it wants to see the U.S. keep up pressure on Pakistan when it comes to dealing with the Taliban, according to Sarna.

India’s Minister of External Affairs Subrahmanyam Jaishankar (R) and U.S. Secretary of State Antony Blinken hold a joint news conference at Jawaharlal Nehru Bhawan in New Delhi on July 28, 2021.

Jonathan Ernst | AFP | Getty Images

The former ambassador also pointed out China’s involvement — the country’s foreign minister Wang Yi met with senior leaders of the Taliban in the Chinese city of Tianjin on Wednesday. That may potentially complicate matters further.

“There’s a lot happening there and it’s very important that the countries with a similar mindset on Afghanistan, who want to restrain the Taliban and make it an inclusive government, get together,” Sarna said.

‘Early days for the Quad’

At this week’s meeting, Blinken and Jaishankar also discussed strengthening the two countries’ regional cooperation bilaterally and through the Quad, a quadrilateral partnership including Japan and Australia.

While the informal alliance positions itself as being committed to a free, open and inclusive Indo-Pacific, some see its existence as a counter response to China’s growing influence in the region.

We’ll have to wait and watch, but I think the immediate concrete thing that can happen is the vaccine initiative.

Navtej Sarna

Former India ambassador to the U.S.

Sarna pointed out that Quad members have distanced themselves from the so-called “anti-China” club rhetoric, which some — including China’s foreign ministry — have called it.

The group will have to work together in areas where they can achieve results such as distributing Covid vaccines, climate change, building up of infrastructure and pushing critical technology advancements.

“These are early days for the Quad,” said the former diplomat, adding that the four countries do not have too much experience working together in many of those areas outlined.

“But, I think the fact that now summits are taking place at the leader level, I think it’s a positive sign,” Sarna said. “We’ll have to wait and watch, but I think the immediate concrete thing that can happen is the vaccine initiative.”

Quad leaders met at a virtual meeting in March and Covid-19 vaccine distribution efforts was part of the agenda.

Blinken’s visit will likely set the stage for the 2+2 Ministerial Dialogue later this year in the U.S. where Jaishankar and India’s defense minister will meet their American counterparts.

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The case against Tom Barrack could draw classified material into court

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Tom Barrack, chairman of Colony NorthStar Inc., speaks during a Bloomberg Television interview at the Milken Institute Global Conference in Beverly Hills, California, U.S., on Tuesday, May 1, 2018.

Patrick T. Fallon | Bloomberg | Getty Images

WASHINGTON — Tom Barrack’s defense attorneys have their work cut out for them, given the breadth and specificity of the evidence in the 45-page federal indictment against him filed last week.

Prosecutors allege that Barrack secretly took direction from the government of the United Arab Emirates, and used his status as an informal advisor to the Trump White House on Middle East strategy to push for the policies that Emirati officials told him to.

In a case that features a co-defendant who was working for the UAE’s intelligence service, and a sensitive subject like U.S. policy in the Middle East, experts say there are several unusual paths the defense could take.

For example, if Barrack’s lawyers try to argue that the White House knew he was working on behalf of the UAE, the conversations Barrack had with U.S. officials, telling them whom he was working for could contain classified material.

In the event they do, there’s a chance Barrack’s defense lawyers could resort to a legal defense tactic called graymail. 

Graymail happens when the defense threatens to expose classified government information during the course of a trial, in the hopes of forcing the government to drop the case rather than risk the exposure of potentially damaging state secrets or agents. 

Barrack’s attorneys did not respond to questions from CNBC about their strategy.

“It’s absolutely possible that the defense will threaten to expose classified information in order to prove [Barrack] wasn’t acting without anyone’s knowledge,” said a former top national security official who was granted anonymity to discuss how classified material is used.

In order to prevent defense attorneys in national security cases from deploying graymail, prosecutors typically tailor their strategy to avoid making classified material a relevant or necessary part of mounting a defense. 

Barrack, a longtime ally of former President Donald Trump, was charged along with Rashid Sultan Rashid Al Malik Alshahhi, an Emirati national with close ties to the royal family, and Matthew Grimes, a junior employee at Colony Capital, which Barrack founded. 

Grimes and Barrack have pleaded not guilty. Al Malik is still at large. 

Thomas Barrack, a billionaire friend of Donald Trump who chaired the former president’s inaugural fund, stands beside his co-defendant and former employee Matthew Grimes and his lawyer Matt Herrington during their arraignment hearing at the Brooklyn Federal Courthouse in Brooklyn, New York, U.S., July 26, 2021 in this courtroom sketch.

Jane Rosenberg | Reuters

Curious timeline

The desire to avoid classified information could help to explain a curious element of the formal indictment against Barrack: The timeline. 

It appears to be carefully designed to keep alleged crimes within a specific time frame, from April 2016 to October 2017.

After 18 months of near-constant communication among the three defendants, the last contact in the indictment is a text message on Oct. 11, 2017. 

The messages indicate that, at the time, the three co-defendants were ramping up an effort to influence how the U.S. responded to a UAE and Saudi-led blockade of Qatar.

But whether Barrack and his co-defendants succeeded may never be publicly known, because the indictment ends abruptly with the Oct. 11 message. 

“It seems like they have some evidence after that that they don’t want to surface, because it could be relevant to these charges,” said the former national security official. 

The duration of the overall conspiracy, prosecutors said, was two years, from April 2016 to April 2018.

But the indictment doesn’t describe what happened during the six months between October 2017 and April 2018.

Yet even with careful planning by the prosecution, several defense strategies could still draw on classified information while remaining inside the current window of time.

Back channels

“I think the Trump administration sort of created new norms in terms of the communications through back, rather than transparent and official, channels,” said Michael Atkinson, inspector general of the Intelligence Community from 2018-20. 

“We saw that with Russia and Ukraine, and there were allegations that it was done with China.” 

Shortly after Trump was elected in 2016, Kushner tried to open a back channel for Trump to communicate privately with Russian President Vladimir Putin. 

A few months later, Kushner privately worked with China’s ambassador to arrange a summit meeting for Trump and Chinese President Xi Jinping at Trump’s Palm Beach resort. 

In 2019, Trump was impeached for pressuring the president of Ukraine to open a sham investigation into Trump’s political rival, then-candidate Joe Biden. 

The prevalence of these unofficial channels made it difficult to know exactly what the Trump administration was saying to allies and adversaries overseas at any given time.

But this confusion could also factor into another possible defense strategy for Barrack, said Atkinson, now a partner at Crowell & Moring.

Barrack’s lawyers “could argue that there was no harm, because the interests of the United States and the UAE were aligned in these matters. So no harm, no foul,” he said.

“They could even try to argue that what these defendants were doing was in the best interests of the United States,” he said.

This is the argument that Al Malik’s lawyer, Bill Coffield, made to The Intercept in 2019. Coffield denied that his client was a spy, but declined to answer more specific questions. 

Al Malik “is a businessman who loves the UAE and the U.S.,” Coffield said at the time. “He has openly shared his beliefs that the best way to forge a stronger bond is through economic prosperity.”

Atkinson, however, is skeptical that this defense would work. 

“This is not a viable defense under the statute,” he said. 

“Even in cases where the United States and a foreign country are pursuing the same objectives, the government doesn’t want people sitting in those types of meetings, and not knowing that they’re acting at the behest, or the direction, of a foreign government.”

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How investors can position portfolios amid China crackdown

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The “tug-of-war” between the Chinese government and capital markets triggered this week’s wild market swings — but investors can position themselves despite the uncertainty, said Cedric Chehab from Fitch Solutions.

“Corporate China is having to navigate a more demanding government and regulatory sector,” Chehab, global head of country risk at Fitch Solutions, told CNBC on Thursday. “For investors, that proves a little bit more challenging cause you don’t know which sector … could come under greater scrutiny going forward.”

Chinese markets have had a rollercoaster week after a series of regulatory announcements aimed at increasing oversight in sectors ranging from technology to education and food-delivery.

The crackdown spooked investors and sent Hong Kong’s Hang Seng index plunging more than 8% in two days before rebounding on Wednesday and Thursday.

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Still, there are three areas in the Chinese markets that investors can focus on that may have less volatility, Chehab told CNBC’s “Capital Connection.”

“Focus on those … companies and sectors that are leveraged to the economic recovery,” he said, adding that they can give “some cover.”

Next, investors can identify sectors that have come under less regulatory scrutiny by Beijing in the last few months or quarters, Chehab added.

Finally, look at sectors that have been largely identified by the Chinese government as “not particularly important from a national security perspective.”

“You have a bit of a tug-of-war in terms of what the government wants and what capital markets want to do,” Chehab said.

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