collapse of Mt. Gox, a Tokyo-based virtual currency exchange that declared bankruptcy in 2014 after huge, unexplained losses of Bitcoin.

If cryptocurrency prices do not recover, “a lot of them will have to go back to work again,” Clinton Donnelly, an American tax lawyer specializing in cryptocurrencies, said of some of those gathered at Bam Bam.

Even so, Mr. Donnelly and other bar regulars said their belief in crypto remained unshaken.

Thomas Roessler, wearing a black Bitcoin shirt and drinking a beer “inspired by” the currency, said he had come with his wife and two young children to decide whether to move to Portugal from Germany. He first invested in Bitcoin in 2014 and, more recently, sold a small rental apartment in Germany to invest even more.

Mr. Roessler was concerned about the drop in crypto values but said he was convinced the market would rebound. Moving to Portugal could lower his taxes and give his family the chance to buy affordable property in a warm climate, he said. They had come to the bar to learn from others who had made the move.

“We have not met a lot of people who live this way,” Mr. Roessler said. Then he bought another round of drinks and paid for them with Bitcoin.

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Ethereum’s Long-Awaited ‘Merge’ Reaches the Finish Line

The moment finally arrived, in the last minutes before midnight on the West Coast on Wednesday.

After years of delays, discussions and frantic experimentation, the popular cryptocurrency platform Ethereum completed a long-awaited software upgrade known as the Merge, shifting to a more environmentally sustainable framework.

Ethereum is arguably the most crucial platform in the crypto industry, a layer of software infrastructure that forms the basis of thousands of applications handling more than $50 billion in customer funds. The upgrade is expected to reduce Ethereum’s energy consumption and set the stage for future improvements that will make the platform easier and cheaper to use.

Celebrations erupted on a YouTube livestream where engineers and researchers who worked on the Merge had gathered to mark the milestone. It was a rare moment of joy in a grim year for crypto that saw a devastating market crash drain nearly $1 trillion from the industry, forcing some prominent crypto companies into bankruptcy.

announced in August that it would pause certain Ethereum deposits and withdrawals during the Merge as a precautionary measure.

In interviews before the Merge, Ethereum developers said they had prepared for snags, though they downplayed the possibility of a systemwide collapse.

“I don’t want to claim everything will go perfectly without a hitch,” said Tim Beiko, who works for the Ethereum Foundation, a nonprofit that helps maintain the platform. “We’re kind of confident we won’t see network-level issues just because we’ve run through the thing so many times before.”

The technical details of the Merge are mind-bendingly complex. But, ultimately, the process boils down to a shift in how cryptocurrency transactions are verified.

In traditional finance, an exchange of funds involves an intermediary, like a bank, which verifies that one entity has enough money to make a payment to another.

Crypto was designed to eliminate such financial gatekeepers. So, early crypto engineers had to devise an alternative system to ensure that users had the funds they claimed to have. Their solution was called “proof of work.” Under that system, powerful computers run software that races to solve complex problems, verifying transactions in the process. The system is widely known as “mining” because the computers earn payments in cryptocurrency as rewards for the verification service.

Bitcoin, the original and most valuable cryptocurrency, runs on a proof-of-work system. And, until the Merge, so did Ethereum. But the process is environmentally draining: To run all those computers requires an enormous amount of energy.

The Merge shifts Ethereum to a verification system called “proof of stake” that uses less energy. Unlike proof of work, the new framework does not involve an energy-guzzling computational race. Instead, participants deposit (or “stake”) a certain amount of their crypto savings in a pool, which enters them in a lottery. Every time a crypto transaction requires approval, a winner is selected to verify the exchange and receive a reward.

By some estimates, Ethereum’s shift to proof of stake will reduce its energy consumption by more than 99 percent. And the project’s developers say the switch will make it easier to design future updates that minimize so-called gas fees — the costs of executing a transaction in Ether, the cryptocurrency associated with the Ethereum platform.

The process of shifting Ethereum to proof of stake required years of intense study and debate. The platform was founded in 2013 by a teenage software engineer, Vitalik Buterin, who remains one of the most influential people in the crypto industry. Ethereum is now run by a loose network of coders from around the world. For months, they have gathered on video calls streamed on YouTube to discuss the intricacies of the Merge.

The shift to proof of stake took so long partly because it required the construction of an entirely new blockchain — the public ledger where cryptocurrency transactions are recorded for all to see. That new chain, the Beacon Chain, was unveiled in December. A series of tests followed this year.

The Beacon Chain has now finally combined with the original Ethereum blockchain, signifying the “merge.”

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A Who’s Who of Silicon Valley Lawyers Up for the Musk-Twitter Trial

Jack Dorsey, a founder of Twitter, got a subpoena. So did Marc Andreessen, a prominent venture capitalist. Larry Ellison, Oracle’s chairman, and the investors David Sacks and Joe Lonsdale received them, too.

They were all summoned to share what they know about the rancorous, knock-down, drag-out tech spectacle of the year: the fight between Twitter and Elon Musk, the world’s richest man.

Mr. Musk enthusiastically agreed to buy Twitter in April for $44 billion, but has since tried to back out of the blockbuster deal, leading to lawsuits and recriminations. Both sides are set for a showdown in Delaware Chancery Court in October over whether Mr. Musk needs to stick with the acquisition. The torrent of legal demands in the case has forced a who’s who of Silicon Valley to now lawyer up, creating a heyday for top-tier law firms.

unsolicited bid worth more than $40 billion for the social network, saying he wanted to make Twitter a private company and allow people to speak more freely on the service.

Of the two sides, Twitter has so far been more aggressive in the discovery process for the case. The company has issued more than 84 subpoenas to uncover discussions that might prove that Mr. Musk soured on the acquisition because the economic downturn decreased his personal wealth. (Mr. Musk’s net worth still stands at $259 billion, according to Bloomberg.)

Twitter has sent subpoenas to Mr. Musk’s friends and associates, such as the former SpaceX board member Antonio Gracias and the entertainment executive Kristina Salen, to get insight into their group chats. The company has also summoned investors like Mr. Andreessen and Mr. Ellison, who agreed to pony up money so Mr. Musk could do the deal.

Mr. Musk himself has agreed to sift through every text he sent or received between Jan. 1 and July 8 for messages relevant to Twitter. His side’s subpoena total stands at more than 36 — including one to Mr. Dorsey — as Mr. Musk tries to show that Twitter lied about the number of inauthentic accounts on its platform, which he has cited as a reason to pull out of the deal.

Mr. Musk has demanded voluminous data from Twitter, including correspondence among its board members and years of account information. Last Thursday, the court granted Mr. Musk a limited set of 9,000 accounts that Twitter audited to determine how many bots were on the platform during a particular quarter. He has also subpoenaed the company’s bankers, Goldman Sachs and J.P. Morgan.

But Mr. Musk has also shown his unhappiness over Twitter’s attempts to obtain his group chats. This month, his lawyers tried limiting the company’s inquiries, saying they did not plan to turn over messages from “friends and acquaintances with whom Mr. Musk may have had passing exchanges regarding Twitter.”

tweeted.

Mr. Sacks, another friend of Mr. Musk’s who worked with him at PayPal, responded to a subpoena from Twitter with a tweet that included an image of a Mad magazine cover featuring a giant middle finger.

In a court filing on Friday, Mr. Sacks’s lawyers, who filed a motion to quash the subpoenas, said he had produced 90 documents for Twitter so far. They accused the company of “harassing” Mr. Sacks and creating “significant” legal bills for him by subpoenaing him in California and Delaware.

A lawyer for Mr. Sacks did not respond to a request for comment.

Kathaleen McCormick, the judge overseeing the case, has largely waved off Mr. Musk’s objections about the subpoenas to his friends. Mr. Musk’s conduct in discovery “has been suboptimal,” and his requests for years of data were “absurdly broad” she wrote in rulings last week.

“Defendants cannot refuse to respond to a discovery request because they have unilaterally deemed the request irrelevant,” Ms. McCormick wrote. “Even assuming that Musk has many friends and family members, Defendants’ breadth, burden, and proportionality arguments ring hollow.”

Ed Zimmerman, a lawyer who represents start-ups and venture capitalists, said it wasn’t surprising that Silicon Valley techies appeared unwilling to be drawn into the case. The venture industry has long operated with little regulatory oversight. Investors have only begrudgingly become more accustomed to legal processes as their industry has fallen under more scrutiny, he said.

“Venture for so long has been very accustomed to being an outsider thing,” he said. “We didn’t have to focus on following all the rules, and there wasn’t that much litigation.”

For law firms, Mr. Musk’s battle with Twitter has become a bonanza — especially financially.

“I’m sure they’re all hiring fancy high-end law firms,” Mr. Melkonian said. “Those guys are going to charge thousands of dollars per hour for preparation.”

That’s if you can find a lawyer at all. Between Mr. Musk and Twitter, they have sewn up a passel of top law firms.

Twitter has hired five law firms with expertise in corporate disputes and Delaware law: Wachtell, Lipton, Rosen & Katz; Potter Anderson & Corroon; Ballard Spahr; Kobre & Kim; and Wilson Sonsini Goodrich & Rosati. Mr. Musk has retained a team of four firms: Skadden, Arps, Slate, Meagher & Flom; Quinn Emanuel Urquhart & Sullivan; Chipman Brown Cicero & Cole; and Sheppard Mullin.

Other leading tech law firms — including Freshfields Bruckhaus Deringer, Perkins Coie, Baker McKenzie, and Fenwick & West — declined to comment, citing conflicts in the case.

Lawyers sitting on the sidelines probably feel left out, Mr. Zimmerman said. “If I were a trial lawyer in San Francisco, with a specialty of dealing with venture funds and the growth companies they invest in, there ought to be that FOMO,” he said, referring to the shorthand for the “fear of missing out.”

For those who have been tapped, the next several months are likely to be chaotic.

“For people who do this work, this is what we live for,” said Karen Dunn, a litigator for tech companies who has represented Apple and Uber, and who is not involved in the Twitter case. “It moves incredibly fast, it is all consuming.”

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Electric Cars Are Too Costly for Many, Even With Aid in Climate Bill

Policymakers in Washington are promoting electric vehicles as a solution to climate change. But an uncomfortable truth remains: Battery-powered cars are much too expensive for a vast majority of Americans.

Congress has begun trying to address that problem. The climate and energy package passed on Sunday by the Senate, the Inflation Reduction Act, would give buyers of used electric cars a tax credit.

But automakers have complained that the credit would apply to only a narrow slice of vehicles, at least initially, largely because of domestic sourcing requirements. And experts say broader steps are needed to make electric cars more affordable and to get enough of them on the road to put a serious dent in greenhouse gas emissions.

would eliminate this cap and extend the tax credit until 2032; used cars would also qualify for a credit of up to $4,000.

With so much demand, carmakers have little reason to target budget-minded buyers. Economy car stalwarts like Toyota and Honda are not yet selling significant numbers of all-electric models in the United States. Scarcity has been good for Ford, Mercedes-Benz and other carmakers that are selling fewer cars than before the pandemic but recording fat profits.

Automakers are “not giving any more discounts because demand is higher than the supply,” said Axel Schmidt, a senior managing director at Accenture who oversees the consulting firm’s automotive division. “The general trend currently is no one is interested in low prices.”

Advertised prices for electric vehicles tend to start around $40,000, not including a federal tax credit of $7,500. Good luck finding an electric car at that semi-affordable price.

Ford has stopped taking orders for Lightning electric pickups, with an advertised starting price of about $40,000, because it can’t make them fast enough. Hyundai advertises that its electric Ioniq 5 starts at about $40,000. But the cheapest models available from dealers in the New York area, based on a search of the company’s website, were around $49,000 before taxes.

Tesla’s Model 3, which the company began producing in 2017, was supposed to be an electric car for average folks, with a base price of $35,000. But Tesla has since raised the price for the cheapest version to $47,000.

pass the House, would give buyers of used cars a tax credit of up to $4,000. The used-car market is twice the size of the new-car market and is where most people get their rides.

But the tax credit for used cars would apply only to those sold for $25,000 or less. Less than 20 percent of used electric vehicles fit that category, said Scott Case, chief executive of Recurrent, a research firm focused on the used-vehicle market.

The supply of secondhand vehicles will grow over time, Mr. Case said. He noted that the Model 3, which has sold more than any other electric car, became widely available only in 2018. New-car buyers typically keep their vehicles three or four years before trading them in.

SAIC’s MG unit sells an electric S.U.V. in Europe for about $31,000 before incentives.

New battery designs offer hope for cheaper electric cars but will take years to appear in lower-priced models. Predictably, next-generation batteries that charge faster and go farther are likely to appear first in luxury cars, like those from Porsche and Mercedes.

Companies working on these advanced technologies argue that they will ultimately reduce costs for everyone by packing more energy into smaller packages. A smaller battery saves weight and cuts the cost of cooling systems, brakes and other components because they can be designed for a lighter car.

You can actually decrease everything else,” said Justin Mirro, chief executive of Kensington Capital Acquisition, which helped the battery maker QuantumScape go public and is preparing a stock market listing for the fledgling battery maker Amprius Technologies. “It just has this multiplier effect.”

$45 million in grants to firms or researchers working on batteries that, among other things, would last longer, to create a bigger supply of used vehicles.

“We also need cheaper batteries, and batteries that charge faster and work better in the winter,” said Halle Cheeseman, a program director who focuses on batteries at the Advanced Research Projects Agency-Energy, part of the Department of Energy.

Gene Berdichevsky, chief executive of Sila Nanotechnologies, a California company working on next-generation battery technology, argues that prices are following a curve like the one solar cells did. Prices for solar panels ticked up when demand began to take off, but soon resumed a steady decline.

The first car to use Sila’s technology will be a Mercedes luxury S.U.V. But Mr. Berdichevsky said: “I’m not in this to make toys for the rich. I’m here to make all cars go electric.” 

A few manufacturers offer cars aimed at the less wealthy. A Chevrolet Bolt, a utilitarian hatchback, lists for $25,600 before incentives. Volkswagen said this month that the entry-level version of its 2023 ID.4 electric sport utility vehicle, which the German carmaker has begun manufacturing at its factory in Chattanooga, Tenn., will start at $37,500, or around $30,000 if it qualifies for the federal tax credit.

Then there is the Wuling Hongguang Mini EV, produced in China by a joint venture of General Motors and the Chinese automakers SAIC and Wuling. The car reportedly outsells the Tesla Model 3 in China. While the $4,500 price tag is unbeatable, it is unlikely that many Americans would buy a car with a top speed of barely 60 miles per hour and a range slightly over 100 miles. There is no sign that the car will be exported to the United States.

Eventually, Ms. Bailo of the Center for Automotive Research said, carmakers will run out of well-heeled buyers and aim at the other 95 percent.

“They listen to their customers,” she said. “Eventually that demand from high-income earners is going to abate.”

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F.T.C. Sues to Block Meta’s Virtual Reality Deal as It Confronts Big Tech

WASHINGTON — The Federal Trade Commission on Wednesday filed for an injunction to block Meta, the company formerly known as Facebook, from buying a virtual reality company called Within, potentially limiting the company’s push into the so-called metaverse and signaling a shift in how the agency is approaching tech deals.

The antitrust lawsuit is the first under Lina Khan, the commission’s chair and a leading progressive critic of corporate concentration, against one of the tech giants. Ms. Khan has argued that regulators must stop competition and consumer protection violations when it comes to the bleeding edge of technology, including virtual and augmented reality, and not just in areas where the companies have already become behemoths.

The F.T.C.’s request for an injunction puts Ms. Khan on a collision course with Mark Zuckerberg, Meta’s chief executive, who is also named as a defendant in the request. He has poured billions of dollars into building products for virtual and augmented reality, betting that the immersive world of the metaverse is the next technology frontier. The lawsuit could crimp those ambitions.

in its lawsuit, which was filed in the U.S. District Court for the Northern District of California. “Instead, it chose to buy” a top company in what the government called a “vitally important” category.

attack on innovation and that the agency was “sending a chilling message to anyone who wishes to innovate in V.R.”

Meta had said it would acquire Within, which produces the highly popular fitness app called Supernatural, last year for an undisclosed sum. The company has promoted its virtual reality headsets for fitness and health purposes.

The F.T.C.’s lawsuit is highly unusual and pushes the boundaries of antitrust law. Regulators mostly focus on deals between large companies in large markets, rather than their acquisitions of small start-ups in nascent tech areas. Courts have also been skeptical applying antitrust law to block mergers based on the hypothetical that the two companies involved would later become competitors if the deal was blocked.

Instagram, the photo-sharing app that has since grown to more than one billion regular users. Instagram has helped Meta dominate the market on social photo sharing, though other start-ups have sprung up since.

lawsuit against Facebook that argued the company shut down nascent competition through acquisitions. The Justice Department has also sued Google over whether the company abused a monopoly over online search.

More cases could be coming. The F.T.C. is investigating whether Amazon has violated antitrust laws, and the Justice Department has inquiries into Google’s dominance over advertising technology and into Apple’s App Store policies.

For Mr. Zuckerberg, the F.T.C. lawsuit is a setback. He has been pushing Meta away from its roots in social networking as its apps, like Facebook and Instagram, face more competition amid stumbles in privacy and content moderation. Instead, he has bet on the metaverse.

Mr. Zuckerberg has reassigned employees and put a top lieutenant in charge of metaverse efforts. He has also authorized executives to pursue some of the most popular games in the V.R. space. In 2019, Facebook purchased Beat Games, makers of the hit title Beat Saber, one of the top V.R. games on the Oculus platform. He has also authorized the purchase of roughly half a dozen other virtual reality or gaming studios over the past three years.

The F.T.C. filed suit on Wednesday hours before Meta reported its first decline in quarterly revenue since it went public in 2012. The company has recently trimmed employee perks and reined in spending amid uncertain economic conditions. John Newman, the deputy director of the F.T.C.’s Bureau of Competition, said the agency acted on the Within deal because Meta was “trying to buy its way to the top.” The company already owned a best-selling virtual reality fitness app, he said, but then chose to acquire Within’s Supernatural app “to buy market position.” He said the deal was “an illegal acquisition, and we will pursue all appropriate relief.”

The F.T.C.’s vote to authorize the filing was split 3 to 2. Christine Wilson, a Republican commissioner at the agency, said she was one of the two votes against the lawsuit. She declined to comment on her reasoning.

The F.T.C. said in its request that asking for an injunction was sometimes a prelude to filing a complaint against a merger, which could embroil Meta and the agency in a lengthy trial and appeals process. A F.T.C. spokeswoman said the agency had not filed such a complaint and declined to comment further on the agency’s strategy.

Ms. Khan, 33, who was appointed by President Biden last year to acclaim from the left, has tried to make good on expansive promises to rein in corporate power. She became prominent after she wrote an article in law school in 2017 criticizing Amazon. As F.T.C. chair, she has called for regulators to vigorously enforce antitrust laws and has said she may craft sweeping online privacy rules that would implicate Silicon Valley companies.

The lawsuit drew praise from Ms. Khan’s allies. Sandeep Vaheesan, the legal director of the Open Markets Institute, a liberal think tank, said in a statement that the lawsuit was a “step toward making building, not buying, the norm for Facebook.”

But tech industry allies assailed Ms. Khan’s actions. Adam Kovacevich, the chief executive of Chamber of Progress, an industry group funded partly by Meta, said that with the new lawsuit, “the agency is more focused on getting headlines than results.” He said Meta “isn’t any closer than pickleball or synchronized swimming are to locking up the fitness market.”

Meta said in a blog post that the F.T.C. would fail to prove that the Within deal would “substantially lessen competition,” which is the bar that is typically set to block a deal under federal antitrust law.

In its lawsuit, the F.T.C. said that if Meta bought Within’s Supernatural, it would no longer have an incentive to improve Beat Saber, the virtual reality fitness game it already owns. But Nikhil Shanbhag, an associate general counsel for Meta, said in the blog post that the games weren’t competitors.

“Beat Saber is a game people play to have fun and it has many competitors,” he said. “Supernatural couldn’t be more different.”

Seamus Hughes contributed research.

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Loans Could Burn Start-Up Workers in Downturn

SAN FRANCISCO — Last year, Bolt Financial, a payments start-up, began a new program for its employees. They owned stock options in the company, some worth millions of dollars on paper, but couldn’t touch that money until Bolt sold or went public. So Bolt began providing them with loans — some reaching hundreds of thousands of dollars — against the value of their stock.

In May, Bolt laid off 200 workers. That set off a 90-day period for those who had taken out the loans to pay the money back. The company tried to help them figure out options for repayment, said a person with knowledge of the situation who spoke anonymously because the person was not authorized to speak publicly.

Bolt’s program was the most extreme example of a burgeoning ecosystem of loans for workers at privately held tech start-ups. In recent years, companies such as Quid and Secfi have sprung up to offer loans or other forms of financing to start-up employees, using the value of their private company shares as a sort of collateral. These providers estimate that start-up employees around the world hold at least $1 trillion in equity to lend against.

start-up economy now deflates, buffeted by economic uncertainty, soaring inflation and rising interest rates, Bolt’s situation serves as a warning about the precariousness of these loans. While most of them are structured to be forgiven if a start-up fails, employees could still face a tax bill because the loan forgiveness is treated as taxable income. And in situations like Bolt’s, the loans may be difficult to repay on short notice.

badly burned by loans related to their stock options.

Ted Wang, a former start-up lawyer and an investor at Cowboy Ventures, was so alarmed by the loans that he published a blog post in 2014, “Playing With Fire,” advising against them for most people. Mr. Wang said he got a fresh round of calls about the loans anytime the market overheated and always felt obligated to explain the risks.

“I’ve seen this go wrong, bad wrong,” he wrote in his blog post.

Start-up loans stem from the way workers are typically paid. As part of their compensation, most employees at privately held tech companies receive stock options. The options must eventually be exercised, or bought at a set price, to own the stock. Once someone owns the shares, he or she cannot usually cash them out until the start-up goes public or sells.

Uber and Airbnb put off initial public offerings of stock as long as they could, hitting private market valuations in the tens of billions of dollars.

That meant many of their workers were bound by “golden handcuffs,” unable to leave their jobs because their stock options had become so valuable that they could not afford to pay the taxes, based on the current market value, on exercising them. Others became tired of sitting on the options while they waited for their companies to go public.

The loans have given start-up employees cash to use in the meantime, including money to cover the costs of buying their stock options. Even so, many tech workers do not always understand the intricacies of equity compensation.

“We work with supersmart Stanford computer science A.I. graduates, but no one explains it to them,” said Oren Barzilai, chief executive of Equitybee, a site that helps start-up workers find investors for their stock.

Secfi, a provider of financing and other services, has now issued $700 million of cash financing to start-up workers since it opened in 2017. Quid has issued hundreds of millions’ worth of loans and other financing to hundreds of people since 2016. Its latest $320 million fund is backed by institutions, including Oaktree Capital Management, and it charges those who take out loans the origination fees and interest.

So far, less than 2 percent of Quid’s loans have been underwater, meaning the market value of the stock has fallen below that of the loan, said Josh Berman, a founder of the company. Secfi said that 35 percent of its loans and financing had been fully paid back, and that its loss rate was 2 to 3 percent.

congratulatory flourish on Twitter in February, writing that it showed “we simply CARE more about our employees than most.”

The company’s program was meant to help employees afford exercising their shares and cut down on taxes, he said.

Bolt declined to comment on how many laid-off employees had been affected by the loan paybacks. It offered employees the choice of giving their start-up shares back to the company to repay their loans. Business Insider reported earlier on the offer.

Mr. Breslow, who stepped down as Bolt’s chief executive in February, did not respond to a request for comment on the layoffs and loans.

In recent months, he has helped found Prysm, a provider of nonrecourse loans for start-up equity. In pitch materials sent to investors that were viewed by The New York Times, Prysm, which did not respond to a request for comment, advertised Mr. Breslow as its first customer. Borrowing against the value of his stock in Bolt, the presentation said, Mr. Breslow took a loan for $100 million.

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Theranos Executive Ramesh Balwani Found Guilty of 12 Counts of Fraud

SAN JOSE, Calif. — Ramesh Balwani, a former top executive at Theranos, was found guilty on Thursday of 12 counts of fraud, in a verdict that was more severe than that of his co-conspirator, Elizabeth Holmes, and that solidified the failed blood-testing start-up as the ultimate Silicon Valley cautionary tale.

Mr. Balwani and Ms. Holmes, who together pushed Theranos to soaring heights with a promise to revolutionize health care, are the most prominent tech executives to be charged with and convicted of fraud in a generation. A jury of five men and seven women took 32 hours to produce a verdict, convicting Mr. Balwani, known as Sunny, of all 10 counts of wire fraud and two counts of conspiracy to commit wire fraud.

In January, Ms. Holmes was convicted of four counts of fraud and acquitted of four counts of fraud. Three other charges were dismissed after the jury could not reach a consensus. She has appealed the verdict, and Mr. Balwani is expected to do the same.

developed a voracious appetite for messy start-up rise-and-fall stories, such as WeWork’s disastrous first attempt to go public and the trickery of Ozy Media. But Theranos was the only one to result in criminal charges. The consequences its executives have faced are likely to send a message to entrepreneurs who exaggerate in the name of innovation.

arguing that Ms. Holmes — as the chief executive and founder of Theranos — was in charge, and by arguing that he had believed in Theranos’s mission and technology.

closing argument. “He worked tirelessly, year after year, to make the company a success.”

Mr. Balwani had two major strikes against him in his defense, said Michael Weinstein, a former Justice Department prosecutor who is the chair of white-collar litigation at Cole Schotz. One was Mr. Balwani’s age, which made him unable to credibly claim youthful naïveté as a defense, as Ms. Holmes had done.

“Holmes could come off as a bit naïve, and they tried to sell that,” Mr. Weinstein said. But Mr. Balwani “came off as more of an experienced technology executive.”

Further, since Mr. Balwani went to trial after Ms. Holmes, prosecutors essentially got a do-over and honed their case. “The streamlined presentation, the streamlined evidence, the streamlined narrative — all was beneficial for the government in the end,” he said.

Evidence from the trial, including text messages, emails and testimony from 24 witnesses, showed that Mr. Balwani had been deeply involved in nearly every aspect of Theranos’s business and aware of its problems. He led its lab, created its financial projections, presided over personnel issues and attended many pitch meetings with investors.

“Mr. Balwani wants you to think he is a victim,” Jeffrey Schenk, an assistant U.S. attorney and a lead prosecutor in the case, said in his closing argument. “Mr. Balwani is not the victim — he’s the perpetrator of the fraud.”

harsh awakening for the tech industry, as stock prices have tanked amid rising interest rates, ballooning inflation and economic uncertainty. Investors, burned by the sell-off, have stopped chasing high-risk, money-losing start-ups, prompting many Silicon Valley companies to cut staff and slow their aggressive plans for expansion. The humbling moment has many predicting the end of a decade-long boom for tech start-ups.

Ms. Holmes accused Mr. Balwani of emotional and sexual abuse, but those accusations were not permitted as evidence in his trial.

“The story of Theranos is a tragedy,” Mr. Schenk, the prosecutor, said in his closing argument.

Kalley Huang contributed reporting.

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3-D Printing Grows Beyond Its Novelty Roots

DEVENS, Mass. — The machines stand 20 feet high, weigh 60,000 pounds and represent the technological frontier of 3-D printing.

Each machine deploys 150 laser beams, projected from a gantry and moving quickly back and forth, making high-tech parts for corporate customers in fields including aerospace, semiconductors, defense and medical implants.

The parts of titanium and other materials are created layer by layer, each about as thin as a human hair, up to 20,000 layers, depending on a part’s design. The machines are hermetically sealed. Inside, the atmosphere is mainly argon, the least reactive of gases, reducing the chance of impurities that cause defects in a part.

“The Mainstreaming of Additive Manufacturing.”

a report by Hubs, a marketplace for manufacturing services.

The Biden administration is looking to 3-D printing to help lead a resurgence of American manufacturing. Additive technology will be one of “the foundations of modern manufacturing in the 21st century,” along with robotics and artificial intelligence, said Elisabeth Reynolds, special assistant to the president for manufacturing and economic development.

Additive Manufacturing Forward, an initiative coordinated by the White House in collaboration with major manufacturers. The five initial corporate members — GE Aviation, Honeywell, Siemens Energy, Raytheon and Lockheed Martin — are increasing their use of additive manufacturing and pledged to help their small and medium-size American suppliers adopt the technology.

VulcanForms was founded in 2015 by Dr. Hart and one of his graduate students, Martin Feldmann. They pursued a fresh approach for 3-D printing that uses an array of many more laser beams than existing systems. It would require innovations in laser optics, sensors and software to choreograph the intricate dance of laser beams.

By 2017, they had made enough progress to think they could build a machine, but would need money to do it. The pair, joined by Anupam Ghildyal, a serial start-up veteran who had become part of the VulcanForms team, went to Silicon Valley. They secured a seed round of $2 million from Eclipse Ventures.

The VulcanForms technology, recalled Greg Reichow, a partner at Eclipse, was trying to address the three shortcomings of 3-D printing: too slow, too expensive and too ridden with defects.

Arwood Machine this year.

Arwood is a modern machine shop that mostly does work for the Pentagon, making parts for fighter jets, underwater drones and missiles. Under VulcanForms, the plan over the next few years is for Arwood to triple its investment and work force, currently 90 people.

VulcanForms, a private company, does not disclose its revenue. But it said sales were climbing rapidly, while orders were rising tenfold quarter by quarter.

Cerebras, which makes specialized semiconductor systems for artificial intelligence applications. Cerebras sought out VulcanForms last year for help making a complex part for water-cooling its powerful computer processors.

The semiconductor company sent VulcanForms a computer-design drawing of the concept, an intricate web of tiny titanium tubes. Within 48 hours VulcanForms had come back with a part, recalled Andrew Feldman, chief executive of Cerebras. Engineers for both companies worked on further refinements, and the cooling system is now in use.

Accelerating the pace of experimentation and innovation is one promise of additive manufacturing. But modern 3-D printing, Mr. Feldman said, also allows engineers to make new, complex designs that improve performance. “We couldn’t have made that water-cooling part any other way,” Mr. Feldman said.

“Additive manufacturing lets us rethink how we build things,” he said. “That’s where we are now, and that’s a big change.”

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Crypto Firms Quake as Prices Fall

SAN FRANCISCO — No one wanted to miss out on the cryptocurrency mania.

Over the last two years, as the prices of Bitcoin and other virtual currencies surged, crypto start-ups proliferated. Companies that market digital coins to investors flooded the airwaves with TV commercials, newfangled lending operations offered sky-high interest rates on crypto deposits and exchanges like Coinbase that allow investors to trade digital assets went on hiring sprees.

A global industry worth hundreds of billions of dollars rose up practically overnight. Now it is crashing down.

After weeks of plummeting cryptocurrency prices, Coinbase said on Tuesday that it was cutting 18 percent of its employees, after layoffs at other crypto companies like Gemini, BlockFi and Crypto.com. High-profile start-ups like Terraform Labs have imploded, wiping away years of investments. On Sunday, an experimental crypto bank, Celsius, abruptly halted withdrawals.

dropped by about 65 percent since autumn, and analysts predict the sell-off will continue. Stock prices of crypto companies have cratered, retail traders are fleeing and industry executives are predicting a prolonged slump that could put more companies in jeopardy.

stocks crashing, interest rates soaring and inflation high, cryptocurrency prices are also collapsing, showing they have become tied to the overall market. And as people pull back from crypto investments, the outflow is exposing the unstable foundations of many of the industry’s most popular companies.

OpenSea, the largest marketplace for the unique digital images known as nonfungible tokens, reached a staggering $13 billion valuation. And Wall Street banks such as JPMorgan Chase, which previously shunned crypto assets, and Fortune 500 companies like PayPal rolled out crypto offerings.

confidence evaporated in the early 2000s, many of the dot-coms went bust, leaving just the biggest — such as eBay, Amazon and Yahoo — standing.

This time, investors predict there will be more survivors. “You certainly have some overhyped companies that don’t have the fundamentals,” said Mike Jones, an investor at the venture firm Science Inc. “But you also have some really strong companies that are trading way below where they should.”

There have been warning signs that some crypto companies were not sustainable. Skeptics have pointed out that many of the most popular firms offered products underpinned by risky financial engineering.

Terraform Labs, for example, offered TerraUSD, a so-called stablecoin with a fixed value linked to the U.S. dollar. The coin was hyped by its founder, Do Kwon, who raised more than $200 million from major investment firms such as Lightspeed Venture Partners and Galaxy Digital, even as critics warned that the project was unstable.

The coin’s price was algorithmically linked to a sister cryptocurrency, Luna. When the price of Luna plummeted in May, TerraUSD fell in tandem — a “death spiral” that destabilized the broader market and plunged some investors into financial ruin.

drew scrutiny from several state regulators. In the end, a drop in crypto prices appeared to put the company under more pressure than it could withstand.

With the price of Bitcoin tumbling, Celsius announced on Sunday that it was freezing withdrawals “due to extreme market conditions.” The company did not respond to a request for comment.

The market instability has also triggered a crisis at Coinbase, the largest U.S. crypto exchange. Between the end of 2021 and late March, Coinbase lost 2.2 million active customers, or 19 percent of its total, as crypto prices dropped. The company’s net revenue in the first three months of the year shrank 27 percent from a year earlier, to $1.2 billion. Its stock price has plunged 84 percent since it went public last year.

This month, Coinbase said it would rescind job offers and extend a hiring freeze to battle the economic downturn. On Tuesday, it said it would cut about 1,100 workers.

Brian Armstrong, Coinbase’s chief executive, informed employees of the layoffs in a note on Tuesday morning, saying the company “grew too quickly” as crypto products became popular.

“It is now clear to me that we over-hired,” he wrote. A Coinbase spokesman declined to comment.

“It had been growth at all costs over the last several years,” said Ryan Coyne, who covers crypto companies and financial technology at the Mizuho Group. “It’s now turned to profitable growth.”

memo to staff, the Winklevoss twins said the industry had entered a “crypto winter.”

commercial starring the actor Matt Damon, who declared that “fortune favors the brave” as he encouraged investors to put their money in the crypto market. Last week, Crypto.com’s chief executive announced that he was laying off 5 percent of the staff, or 260 people. On Monday, BlockFi, a crypto lending operation, said it was reducing its staff by roughly 20 percent.

Gemini and BlockFi declined to comment. A Crypto.com spokesman said the company remains focused on “investing resources into product and engineering capabilities to develop world-class products.”

Cryptocurrencies have long been volatile and prone to boom-and-bust cycles. In 2013, a Chinese ban on Bitcoin sent its price tumbling. In 2017, a proliferation of companies creating and selling their own tokens led to a run-up in crypto prices, which crashed after regulators cracked down on so-called initial coin offerings.

These bubbles are built into the ecosystem, crypto enthusiasts said. They attract talented people to the industry, who go on to build valuable projects. Many of the most vocal cheerleaders encourage investors to “buy the dip,” or invest more when prices are low.

“We have been in these downward spirals before and recovered,” Mr. Jones, the Science Inc. investor, said. “We all believe in the fundamentals.”

Some of the companies have also remained defiant. During Game 5 of the N.B.A. finals on Monday night, Coinbase aired a commercial that alluded to past boom-and-bust cycles.

“Crypto is dead,” it declared. “Long live crypto.”

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How Influencers Hype Crypto, Without Disclosing Their Financial Ties

Some of the projects that Mr. Armstrong promoted were small-time, experimental crypto ventures that eventually encountered problems. In those cases, he said, he considered himself a victim, too.

“They’re preying on the novice crypto influencer who just got popular and is trying to figure out what they should and shouldn’t be doing,” he said. “It’s hard to go from 12,000 followers to a million in one year and make all the right decisions.”

Mr. Paul rose to fame as a video blogger and an occasional actor; YouTube once reprimanded him for publishing footage of a dead body he found in a Japanese forest. Over the years, he has parlayed his internet fame into an eclectic array of entrepreneurial pursuits, including a line of energy drinks.

Mr. Paul became interested in crypto last year as the market for NFTs started booming. In a recent interview, he acknowledged that he was still learning how to navigate the crypto market, even as he tried to profit from the technology. “I’m an extreme ideas person, not much of an executor,” he said.

Mr. Paul was involved in some of the initial brainstorming for the Dink Doink project. But the venture was ultimately spearheaded by one of his roommates, Jake Broido, who gave Mr. Paul 2.5 percent of the tokens that were initially issued.

In a tweet last June, Mr. Paul called it one of the “dumbest, most ridiculous” cryptocurrencies he had encountered, and circulated a video of a cartoon character singing sexually explicit lyrics. “That’s why I’m all in,” he added. He also appeared in a shaky-cam video on Telegram in which he hailed Dink Doink as possibly his favorite crypto investment.

The campaign was a flop, and Mr. Paul was pilloried by YouTube critics. The price of Dink Doink hovered well below a cent, before falling even further in value over the summer. Mr. Paul said he had never sold his tokens or profited from the project. But he said he regretted promoting the coin without disclosing his financial stake. “I definitely didn’t act as responsibly as I should have,” he said.

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