19THEBOTTOMLINE Regulatorsandcompaniesarescrambling
to address rampant fraud on cryptocurrency exchanges; many
services that sort through exchange data are now available.
is notapprovingcrypto-relatedexchange-traded
fundspartlybecauseofconcernaboutexchange
integrity.Theagencyinrecentyearshasrejected
a numberofapplicationsforbitcoinETFs,includ-
ingfromTylerandCameronWinklevoss,citing
failuresbyapplicantstodemonstratehowthey
wouldpreventfraudandmarketmanipulation.The
Winklevosstwinsarestartinga self-regulatoryorga-
nizationtheysaywillpolicetheindustryintheU.S.
InJune,theFinancialActionTaskForce—an
intergovernmentalorganizationthatestablishes
anti-money-launderingrulesfollowedbymost
countries—beganrequiringexchangestocollect
informationonsendersandrecipientsofmore
than$1,000or€1,000.Butbecauseofjurisdictional
issues,somecryptoexchanges,suchasthosebased
inlightlyregulatedplacesliketheCaribbean,may
notfollowthoserules.
A cottageindustryhassprungupsellingspecial-
izedtoolsthatclaimtomaketheexchangesmore
transparent.Ex-GoldmanSachs vicepresident
RaakheeMillerlaunchedBitsianin 2018 andstarted
signingontrialcustomersthisspring,mostlyretail
investorsandfunds.Theservicehasdeviseda way
tospotordersplacedbybotsengagedinso-called
spoofing—basically,sendingordersandthencancel-
ingthematthelastminutetocreatetheimpression
ofhighdemand.Bitsiansaysit recentlydiscovered
100,000instancesofsuchspoofingonjustone
exchangeinonemonth.
AsFidelity,Facebook,andotherlargecom-
paniesventureintocrypto,oversightandtrans-
parency may improve. Fidelity launched a
crypto-custodyserviceearlierthis year—until
recently,suchserviceswereofferedonlybystart-
ups.Facebookhaspromisedregularauditsofthe
digitalcurrencyit’shelpingtodevelop.Earlierthis
year,Nasdaqdisclosedthata handfulofcrypto
exchangesareusingitsSmartstradesurveillance
systemtoidentifycustomerswhomaybeengag-
inginpump-and-dumpschemesandwashtrad-
ing,artificialtransactionsmeanttomanipulatethe
priceandmisleadthemarket.
Nasdaqis carefulaboutwhichexchangesit sells
Smartsto,saysTonySio,itsheadofmarketplacereg-
ulatorytechnology.It vetspotentialbuyerstomake
suretheexchangewillactuallyuseSmartstocom-
batfraud.Notallexchangespassthetest.“That’s
thething,”Siosays.“Weareprovidingtoolsforan
exchangetoweedoutbadbehavior.If anexchange
doesn’twanttoweedoutthatbehavior, then there’s
not much we can do.” �Olga Kharif
Operatingin deep-seawaterswithintensepressureandplentiful
debrisremainsa costlychallengefortheoilandgasindustry—
onewithpotentialconsequencesfortherestofus,whohave
tolivewiththeaftermathofa spill.Keepingplatformequipment
runningandworkingproperlyin theseenvironmentsis a constant
battle,requiringregularinspectionsthatcanlastaslongasfour
months.In BrazilandItaly,scientistshavedesigneda solution:
theFlatFish,a 12-foot-long,3-tonautonomoussubpoweredby
batteriesandartificialintelligence.�AdamPioreClimate FlatFish
◼ TECHNOLOGY
①HowIt Works
TheFlatFishcontains
a tonofbuoyancyfoam
andis propelledby
sixthrusters.It’sdesigned
tofunctionin waters
asdeepas10,000feet
foraslongasa yearand
packedwithgearthat
canwithstandthe
attendantpressure,
includinglaser-line
projectors,sonars,and
camerasthatcollect
high-definition 3D images,
helping it detect and evade
underwater debris.② Tasks
The sub’s AI software
recognizes complex
shapes, adjusts to
different conditions,
and inspects pipelines,
cables, mooring lines, and
other subsea equipment,
identifying even small
dents and assessing
whether they point to
bigger problems. The
FlatFish can call in other
drones to make repairs.③ Origin
The project started in 2013 as a collaboration among
Brazilian research and development institute
SenaiCimatec,GermaninstituteDFKI,andBGGroup,
nowa subsidiaryofRoyalDutchShellPlc.After
testingaprototypein shallowwaters,Shellagreed
tolicensethetechnology to Saipem SpA, an Italian
oil and gas company that’s since funded its deep-sea
adaptation and commercialization.④Costvs.Savings
SaipemexpectseachFlatFishtocost$3.5million
to$5milliontobuild.Thedevelopersspentan
estimated$10milliononinitialR&D,andRoberto
DiSilvestro, who oversees the FlatFish project
at Saipem, says his company expects to spend
more than that to bring the drone to market.
The developers say they expect the craft to cut
platform maintenance costs in half while eliminating
the need for a carbon-spewing support ship
on the surface.⑤ Hurdles
InBrazil,a prototypecarriedoutcomplexinspection
tasksatdepthsofabout1,000feet.AsDiSilvestro’s
team refines its latest model in Venice, scheduled for an
extended trial later this year, perhaps the most complex
challenge is refining the AI. Engineers are working to
enable the FlatFish to identify and inspect installations
that move with ocean currents.