It is Thanksgiving week here in the United States. Our team gathered thoughts courtesy of the team at the Information on the turmoil at OpenAI, Peter Diamandis, and Coinbase as we gear up for our end of year and begin planning for the new year.

We wish all a joyous and restful Thanksgiving:

EXCLUSIVE

Emmett Shear Becomes Interim OpenAI CEO as Altman Talks Break Down

By Amir Efrati

Sam Altman won’t return as CEO of OpenAI, despite efforts by the company’s executives to bring him back, according to co-founder and board director Ilya Sutskever. After a weekend of negotiations with the board of directors that fired him Friday, as well as with its remaining leaders and top investors, Altman will not return to the startup he co-founded in 2015, Sutskever told staff. Emmett Shear, co-founder of video streaming site Twitch, will take over as interim CEO, Sutskever said.

The decision could deepen a crisis precipitated by the board’s sudden ouster of Altman and its removal of President Greg Brockman from the board Friday. Brockman, a key engineer behind the company's successes, resigned later that day, followed by three senior researchers, threatening to set off a broader wave of departures to OpenAI’s rivals, including Google, and to a new venture Altman has been plotting in the wake of his firing.

Our Innate Problem-Solving Prowess

What distinguishes Homo sapiens from almost all other species on the planet is our ability to solve problems.

And we’re damn good at it!

But sometimes our eagerness to detect problems, likely driven by our evolutionary default software of fear and scarcity, results in overestimating a problem’s scale, timeline, and impact.

For example, we saw earlier in this series when science journalist Matt Ridley realized that the environmental doom predicted from acid rain hadn’t materialized as expected, prompting his inquiry into the accuracy of other common pessimistic assumptions.

Ridley’s research, highlighting erroneous predictions and underscoring humanity’s ability to avert disasters through innovation, birthed his book The Rationale Optimist, advocating for an optimistic worldview.

In today’s blog and the next one, we’ll look at several other historical examples of massive grand challenges that were once real (or perceived as real), but were then solved by technology or policy.

Let’s dive in…

The Great Horse Manure Crisis of 1900: Problem Solved

The sun was beginning to beat down on New York City on a typical summer morning in 1893, casting long shadows among the tall, stone-and-brick buildings. The city was alive with the hustle and bustle of horsecars navigating through New York's labyrinth of streets. By this time, New Yorkers were making over 100 million horsecar trips each year, a far cry from the 35 million a decade earlier.

New York had become a city of horses, with more than 150,000 of them plodding its streets, each producing, on average, 22 pounds of manure daily. That was approximately 45,000 tons of manure produced each month in the city alone. On Liberty Street, the manure pile had reached an appalling height of seven feet. Vacant lots were transformed into manure mountains towering 40 to 60 feet high.

As the summer heat intensified, the city streets, layered with manure, seemed to simmer, emitting a noxious stench that held the city hostage. To quote Edith Wharton from The Gilded Age Revisited, “The stench of horses was an omnipresent part of life, an almost living entity that pervaded our nostrils daily. It was a potent brew of manure and urine, enough to make the most ironclad stomach wretch.”

When it rained, rivers of manure would flood the streets, often creeping into basements and contaminating homes.

Predictions about the future of the “Great Horse Manure Crisis” were grim. One commentator predicted that by 1930 horse manure would reach the level of Manhattan’s third-story windows.

The problem seemed insurmountable.

And it wasn’t limited to New York. In England, The Times newspaper predicted in 1894 that, “In 50 years, every street in London will be buried under nine feet of manure.”

Then, in the early years of the 20th century, hope began to glimmer. A new form of technology, the automobile, began to make its presence felt. Silent, swift, and, most importantly, clean, these machines promised a solution to the problem that had plagued the city for decades.

With the development of the internal combustion engine suddenly there were new ways to move people and goods around.

By 1912, the number of automobiles in New York outnumbered horses. The city's last horse-drawn streetcar made its final run in 1917. The mountains of manure that had once been a fixture of city life began to disappear, and the pungent odor that had once permeated the city started to fade.

The once predicted demise of New York City buried under horse manure was but a distant, grim memory.

Instead, the streets were filled with the hum of engines and the honking of horns. Steven D. Levitt and Stephen J. Dubner summed up this story in their book SuperFreakonomics:

“When the solution to a given problem doesn’t lie right before our eyes, it is easy to assume that no solution exists. But history has shown again and again that such assumptions are wrong."

Ozone Depletion: Problem Solved

It was the 1970s, a time when disco ruled and chlorofluorocarbons, or CFCs, were king.

Coolants in refrigerators, aerosols, industrial cleaning agents—you name it, CFCs were everywhere. But in the midst of this ubiquitous substance, a chilling discovery emerged. Three chemists, Mario Molina, Sherwood Rowland, and Paul Crutzen unveiled a sinister reality: CFCs were steadily eating away at our planet's ozone layer, our shield against harmful solar radiation.

By 1984, evidence of our self-inflicted wound was stark.

At Antarctica's Halley Bay research station, the ozone layer had depleted by a third compared to previous decades. A world increasingly bathed in dangerous UV radiation sparked fears of apocalyptic proportions. As Paul Newman hauntingly asked, "How do you raise crops for the few billion people on the planet if you've got so much sterilizing UV radiation pouring in on the Earth?"

Predictions of soaring skin cancer rates and collapsing ecosystems ignited a palpable terror globally.

Amid this looming catastrophe, the tide began to turn. A ray of hope pierced through the dark clouds in the form of the Montreal Protocol of 1987, a global treaty that signaled the end of the CFC era. A unified front against this invisible foe, the Protocol saw the near eradication of CFC production by the early 2000s, and the introduction of alternative substances, albeit with their own climatic concerns.

As the years rolled on, the seemingly insurmountable problem of ozone depletion began to recede into the annals of human memory. Indeed, today, after universal ratification of the Montreal Protocol and a constant scientific vigil, we've achieved a remarkable feat: the ozone layer is healing.

While a seasonal hole over Antarctica reminds us of our past transgressions, it's closing steadily, signifying a return to pre-1980 levels by mid-century.

According to certain models, this historic international pact has thwarted up to 2 million skin cancer cases yearly and staved off millions of cataract cases globally.

Why This Matters

As Ridley’s The Rational Optimist underscores, these stories of humanity overcoming these grand challenges teach us not to be imprisoned by pessimistic assumptions.

Instead, they urge us to harness the potential of technology, policy, and collective willpower.

In our next blog, we’ll explore even more examples of how we’ve used these forces to solve problems that were at one point perceived as insurmountable.

What will the structure of the near-term AI industry look like? How will incumbents partner with/challenge/fight the upstarts and what kind of AI tech will businesses actually spend on?
Next phase of finance. The fintech boom has had a reckoning but there is a lot of activity to come. With our banking and our fintech and startup teams, we’re already hearing about a lot of new developments into and outside legacy institutions.
TikTok. Take skyrocketing growth and marry it with mounting concern about misinformation and Chinese influence in a Presidential election season. Something big—with global ramifications—is going to happen.
Deals, deals, deals. From struggling startups and legacy media brands to late-stage private companies that got WAY ahead of their skis, we are simply going to see a lot of activity. We will break the news but also get ahead of the why and what is next.

The Tech Blog

By Peter H. Diamandis, MD

Solving Problems: Creating a Better Tomorrow

We humans are an ingenious species.

Do we cause problems and muck things up? Sure.

But we’re also incredibly good at overcoming grand challenges and, over the long-run, increasing access to abundance.

In today’s blog, I’ll look at how a combination of innovation, policy, and hard work helped us face and ultimately solve two disease-related grand challenges: smallpox and polio (in the US).

These are what I call “Category 1 Problems,” past challenges that at first seemed insurmountable, but which we eventually solved through our ingenuity and collective willpower.

We’ll also explore several additional problems that we have either solved or made significant progress toward solving.

Let’s dive in…

The Eradication of Smallpox: Problem Solved

Smallpox, the dreadful “spotted death,” had been humanity's persistent nemesis for thousands of years, tracing its lineage back to its zoonotic roots some 3,000 years ago.

From Egyptian pharaohs to Chinese peasants, no one was immune. Its insidious power lay in its high contagion and mortality rates, killing 30% of those it infected. By the 20th century, it claimed between 300 and 500 million lives globally.

The tiny virus caused havoc on an enormous scale. Its symptoms ranged from fever and tremors in infants, to the disfiguring rash that left survivors marked for life. From the time Europeans introduced it to the New World in the 16th century, it decimated up to 90% of some Indigenous populations.

Then entered a transformative scientific innovation—the vaccine, thanks to Edward Jenner. His monumental work in 1796, grounded in the age-old method of inoculation, was to prevent smallpox infections, utilizing the immunizing effects of a milder cowpox infection. This breakthrough catalyzed a global movement towards eradication, with the US Congress passing legislation for smallpox vaccination in 1813.

The 20th century, however, saw a resurgence of outbreaks with the advent of international travel. While richer countries managed to contain the disease through regular vaccination, the less fortunate ones still fell prey to its devastating effects.

In the face of this, the newly formed World Health Organization (WHO) took the helm, launching an intensified plan in 1967 for smallpox eradication through widespread immunization, surveillance, and an innovative “ring vaccination” strategy. Despite initial skepticism, their efforts bore fruit—by December 9, 1979, smallpox was confirmed to have been eradicated, officially declared by the World Health Assembly five months later.

Now, over 40 years later, smallpox remains the only infectious disease we've managed to erase from our midst, a triumph we often take for granted.

According to the WHO, “This remains among the most notable and profound public health successes in history.”

The Eradication of Polio in the US: Problem Solved

In the early 20th century, the specter of polio cast a long shadow across the United States.

An enigmatic, brutal, and relentless adversary, the polio virus first gripped the nation in a major epidemic in 1894. However, the fear hit fever pitch in the 1950s, turning summertime, a season of joy and freedom, into a period of dread known as "polio season."

The fear wasn't baseless. In 1952, almost 60,000 children were infected, thousands were left paralyzed, and over 3,000 lost their lives. The virus played no favorites—it brought both rich and poor to their knees. Even Franklin D. Roosevelt, a future president, was not immune. His battle with polio, although kept under wraps, brought this silent enemy into the limelight.

President Harry Truman, recognizing the existential threat posed by polio, rallied the nation with these words: "The fight against infantile paralysis cannot be a local war. It must be nationwide. It must be total war in every city, town, and village throughout the land. For only with a united front can we ever hope to win any war."

And win we did. The arrival of the polio vaccine, developed by Jonas Salk, in 1955 was greeted with nationwide relief and jubilation. No longer would summer bring dread. The iron lungs that kept victims alive were relegated to the pages of history. By 1979, the US had turned the tide, recording its last case of polio.

The extraordinary victory over polio did not stop at US borders. The war shifted globally with the establishment of the “Global Polio Eradication Initiative” in 1988. The figures speak for themselves: by 2016, paralytic cases had been reduced by 99.99%. In 2022, only 30 cases were reported in regions still fighting the virus.

The polio story is a stark reminder of the power of human resolve, the strength of unified action, and the miracles of science.

Today, polio, once a dreaded monster, is but a distant memory in the US. Yet, it also serves as a call to arms, reminding us that the fight isn't over until polio is but a footnote in the annals of global history.

A Few Others…

As we wrap up a look at Category 1 Problems, it’s worth noting a few additional areas where we clever humans have either solved the problem through innovation or policy, or at a minimum have made changes that have us heading in the right direction.

HIV/AIDS Treatment: While not completely eradicated, the development of antiretroviral therapy has transformed HIV/AIDS from a death sentence into a manageable chronic condition for many people. Perhaps even more exciting is the prospect of an HIV vaccine currently in human trials.

Lead Poisoning: The phaseout of lead in gasoline, paint, and plumbing has significantly reduced lead poisoning worldwide. This was achieved through policy changes and the development of alternatives, such as unleaded gasoline.

Deforestation: While deforestation continues to be a problem, particularly in the tropics, reforestation, and afforestation efforts in countries like China and technological innovations in sustainable agriculture have helped to slow the rate of global deforestation.

Waterborne Diseases: Innovations in water treatment, such as chlorination and filtration, have dramatically reduced the incidence of waterborne diseases in many parts of the world.

Air Pollution: While air pollution remains a significant problem, particularly in developing countries, advancements in emission control technologies and policies to regulate industrial emissions have led to improvements in air quality in many cities.

Marine Pollution: International agreements and improved waste management practices have helped to reduce marine pollution. Innovations in material sciences, such as the development of biodegradable plastics, also hold promise for reducing plastic pollution in the oceans.

Nuclear Accidents: The international community has made significant strides in improving the safety of nuclear power plants and managing nuclear waste to prevent accidents like Chernobyl and Fukushima.

Oil Spills: While oil spills still occur, advancements in cleanup technologies and stricter regulations have reduced their frequency and impact.

These examples illustrate how technology, policy, and international cooperation can help to address global challenges. However, it's important to note that many of these issues are ongoing and require continued effort to fully resolve.

Why This Matters

When faced with seemingly insurmountable odds, humanity doesn't just hope for a better tomorrow—we create it.

And with rapidly advancing technologies such as AI and biotech, our ability to solve problems and create a world of abundance is only expanding.

But we do face real challenges ahead, what I call “Category 2 Problems,” dangers and threats that can’t be ignored and deserve the attention of our greatest minds. These challenges are the subject of the next few blogs in this series.

Altman Decision Looms as Sequoia, Tiger Negotiate
Behind Scenes

By Kate Clark and Natasha Mascarenhas

OpenAI co-founder Sam Altman could make a decision as soon as Saturday evening on whether to return to the startup he co-founded, after some major investors urged the board that fired him to reverse the decision, according to people familiar with the discussions. In order to return, the members of the board would have to be replaced. Alternatively, Altman would continue with plans to launch a new venture.

Tiger Global is part of an investor group that is pushing to get OpenAI’s board of directors to reinstate Altman, according to a person familiar with the matter. Separately, Sequoia Capital has been talking to Altman about next steps, including a potential return, said a second person. The firm has also been encouraging executives at Microsoft, OpenAI’s largest backers, to help engineer his return, according to the person.

Where 4 key analysts think crypto markets are headed

With optimism around spot BTC ETF approval growing by the week, ETH getting a boost from some ETF hype of its own, and crypto markets from DeFi to NFTs heating up, what’s likely to happen next? This week, we’ve rounded up takes from four major analysts to see what professional market watchers are predicting.

Bloomberg Intelligence: 90% chance of near-term spot BTC ETF approval.

Bloomberg Intelligence analysts suggested that Wall Street’s many spot BTC ETF applications could begin getting greenlit by the SEC as early as this week, during an approval window that’s open until Nov. 17. “Even if approvals don't arrive this month,” they added, “we still believe there's a 90% chance of approval by Jan. 10.”

Bernstein: BTC could climb as high as $150,000 by 2025.

Bernstein analysts predict that new flows of institutional capital enabled by the proposed spot ETFs will combine with BTC’s forthcoming halving to trigger the next bull cycle: “We believe early flows could be slower and the build up could be more gradual, and post-halving is when ETF flows momentum could build, leading to a cycle peak in 2025 and not 2024.”

The halving is a mechanism built into BTC’s code intended to make it a rare, inflation-resistant asset. About every four years — or more exactly, after every 210,000 blocks — the amount of new bitcoin generated is reduced by half until all 21 million bitcoins have been mined sometime around 2140. Read last week’s Bytes to learn more.

Morgan Stanley: “Crypto winter may be in the past.”

“Historically, most of bitcoin’s gains come directly after a ‘halving’ event that occurs every four years,” noted a recent post on the Morgan Stanley Wealth Management website. “Based on current data, signs indicate that crypto winter may be in the past and that crypto spring is likely on the horizon.”

JPMorgan: “Crypto rally looks overdone.”

Unlike their colleagues at other firms, the authors of a new JPMorgan report are skeptical about spot ETFs driving a major net increase in crypto investment. "[I]nstead of fresh capital entering the crypto industry to be invested in the newly-approved ETFs,” JPMorgan’s report said, “we see as a more likely scenario existing capital shifting from existing bitcoin products such as the Grayscale bitcoin trust, bitcoin futures ETFs, and publicly listed bitcoin mining companies, into the newly-approved spot bitcoin ETFs.”

What a turn of events! OpenAI began the day once again as the hottest startup in tech, run by the smartest hotshots in artificial intelligence. But around lunchtime on the west coast, it was a car crash, one that kept getting worse throughout the day.

First, the OpenAI board dropped a bombshell with the announcement that it had ousted CEO Sam Altman after finding he was “not consistently candid in his communications” with the directors. The board named Mira Murati, the company’s chief technology officer, as interim CEO. Four hours later, OpenAI President Greg Brockman, the executive responsible for ChatGPT and other key products, quit the company, as a result of Altman’s defenestration.

To say this was a surprise would be a stupendous understatement. The departures caught even the startup’s closest backers off guard. Top executives at Microsoft, which committed more than $10 billion in the company at the start of the year and made the partnership a cornerstone of its AI strategy, only learned of the board’s decision minutes before the announcement went out.

Murati sought to calm the shell-shocked OpenAI staff, assuring them Microsoft CEO Satya Nadella had “utmost confidence” in the startup. Nadella later published a short blog post, noting the company’s “long-term agreement with OpenAI with full access to everything we need” without any mention of Altman.

Altman himself showed little sign in recent days that his status at OpenAI was in jeopardy. On Thursday he spoke on a panel at the APEC CEO Summit, alongside a top executive from Meta, and fit in one of his regularly scheduled calls with Microsoft executives. Later that night, he went to Oakland to speak at an event about the impact of AI on artists, in what appeared to be his last time speaking publicly as OpenAI’s CEO.

Even more extraordinary, OpenAI’s board hasn’t explained why it sacked Altman. The resulting information vacuum sent the rumor mill into overdrive. Yet by Friday evening, our reporters had uncovered a dispute that was bubbling up privately among employees about whether the company was developing artificial intelligence safely. The disagreements were fresh on employees’ minds during the all-hands meeting—to the degree that at least two asked co-founder Ilya Sutskever, a co-founder and board member, if the departures amounted to a “coup.” He disagreed. Of course, our reporters have only cracked part of the story. One explanation is noticeably still missing: Altman’s. Stay tuned. (Read the full report here). —Laura Mandaro and Nick Wingfield

The Information’s Stories of the Week:

Until the OpenAI drama unfolded, one of the most riveting stories of the week was Erin’s report on Snap co-founder and CEO Evan Spiegel, who seems to have taken inspiration from Tesla CEO Elon Musk in his efforts to revitalize Snap. He’s cutting product managers, running meetings an underling normally would and wondering why people aren’t staying at the office later. It’s Spiegel’s ‘Elon moment,’ sources told her. More here.

The terms JP Morgan and metaverse aren’t a natural pairing. In fact, the nation’s largest bank dove into the hype along with the best of Silicon Valley with a crypto-focused virtual world called Decentraland via its blockchain business unit Onyx. This year, Michael reports, it’s been quietly steering Onyx away from the metaverse and focusing more on products and services that can generate revenue.

The race among tech companies to make their costly investments in artificial intelligence pay off will hinge around their ability to get big customers to pay. Here, Google encountered a minor setback: It’s telling customers and business partners they won’t be able to test its new Gemini AI model until the first quarter, later than the November date they earlier predicted. In other AI news, there’s a new rift in Silicon Valley opening up around regulation: while large tech companies are coming out in favor of certain kinds of AI regulation, venture capitalists like Andreessen Horowitz are saying, no way.

As Silicon Valley Bank collapsed, we reported how fintech startups like Mercury and Brex received a surge of new customers. Now we’re learning what’s happened in the aftermath. Mark reports on the slowdown in business at Brex. Its CEO Henrique Dubugras tells him he is trying to cut costs and turn cash flow positive. The company is also targeting an IPO—but not till 2025.

The great startup valuation reset is starting to take hold. As Kate highlighted in her Dealmaker column this week, investors including Coatue are biting the bullet and making dramatic markdowns to startup stakes. It won’t be long before others join. Kate also scooped that Coatue is waiving management fees for some investors for a $1.4 billion fund, revealing how firms are managing to raise big funds during the market correction. And under-the-radar firesales are piling up—Maria reported how design startup InVision, once valued at $2 billion, sold most of itself for less than $100 million.

At the same time, business is booming at Shein and ByteDance. China-founded fast fashion powerhouse Shein’s revenue soared more than 40% to $24 billion in the first three quarters of this year. Similarly, the Chinese owner of TikTok saw revenue surge more than 40% year-on-year to $29 billion in the second quarter, far outpacing growth at ad-powered giants like Meta. —Meredith Mazzilli

In Other News

Amazon is laying off hundreds of employees who worked on its Alexa voice assistant. (More here.)
TikTok is trying to do damage control as celebrities and creators criticize how the video app is handling antisemitic content. (More here.)
Apple, Disney and Lionsgate have all suspended their advertising on the X, formerly known as Twitter, after Elon Musk supported an antisemitic comment on the service, according to The New York Times. (More here.)