Wealthy Nations Commit $300B Annually

FINANCE
Wealthy Nations Commit $300B Annually

After two weeks of tense negotiations, nearly 200 nations at COP29 in Azerbaijan reached a contentious agreement requiring wealthy polluters to contribute $300 billion annually by 2035 to help poorer nations combat climate change. The deal, finalized in the early hours under a stadium roof, falls short of the $500 billion demanded by vulnerable countries but exceeds the current $100 billion commitment set to expire.

The final agreement increases the proposed $250 billion in a draft presented Friday, which developing nations had condemned as insufficient. Despite deep divisions, stormy walkouts, and accusations that Azerbaijan’s oil-rich leadership lacked the resolve to meet the crisis, nations ultimately approved the pact.

Developed nations, led by the U.S. and EU, resisted calls for greater public funding, citing political constraints, especially with Donald Trump’s return to the White House in January. Emerging economies like China were encouraged to contribute voluntarily, reflecting no mandated change in their role.

The deal also envisions a broader $1.3 trillion annual target, largely reliant on private funding, to address rising global temperatures and worsening disasters. Efforts to phase out fossil fuels were diluted by resistance from Saudi Arabia, while island nations and vulnerable countries pushed for more ambitious action.
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TECH
OpenAI Transition Sparks Legal Challenges

Elon Musk’s lawsuit against OpenAI is grabbing headlines, but the AI powerhouse faces a far bigger challenge: its transition from nonprofit to for-profit status. OpenAI’s nonprofit arm, OpenAI Inc., holds tax-exempt status under the IRS, but its operating company, OpenAI Global LLC, is now valued at $157 billion, raising questions about how the transition will comply with tax regulations.

The stakes are high. IRS rules require nonprofits converting to for-profit to compensate the public sector for the value of their assets. While OpenAI’s nonprofit lists assets at just $21 million, experts suggest that the true cost of the conversion, accounting for public interest and governance loss, could exceed $30 billion. These funds would be used for public benefit, potentially endowing a foundation focused on AI safety.

California and Delaware attorneys general are scrutinizing the deal to ensure taxpayers aren't shortchanged, while experts warn that mishandling could trigger lawsuits and tax liabilities. OpenAI CEO Sam Altman insists the transition is necessary to meet rising operational costs, but critics argue it risks violating the nonprofit’s public-benefit mission.

As regulatory scrutiny mounts, OpenAI’s success depends on navigating this complex legal landscape carefully. Lawyers are working overtime to ensure compliance in a move that could reshape how startups balance profit and public good.
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CRYPTO
Pro-Crypto Candidates Dominate Midterm Elections

The crypto industry has achieved unprecedented political influence following the 2024 election, securing nearly 300 pro-crypto lawmakers in Congress, according to advocacy group Stand With Crypto. Industry PACs and contributors raised over $245 million, strategically targeting key races to support pro-crypto candidates and oust critics.

One notable victory was Republican Bernie Moreno’s defeat of Democratic Senator Sherrod Brown, a prominent crypto critic, in Ohio. Moreno, a blockchain entrepreneur, received $40 million in campaign support from crypto PACs, including Fairshake, which invested heavily in pro-crypto candidates nationwide. Fairshake-backed candidates won nearly every race, solidifying the industry's sway.

Major players like Coinbase, Ripple, and Andreessen Horowitz were key contributors, with executives like Brian Armstrong and Chris Larsen donating millions. Kraken’s Jesse Powell and the Winklevoss twins also made significant contributions.

This lobbying success has reshaped Congress, marking a turning point for crypto regulation. Coinbase’s Armstrong praised the election as a chance for “regulatory clarity.” With SEC Chair Gary Gensler announcing his resignation, the path is clearer for crypto-friendly regulators under the Trump administration. The industry’s focus now shifts to legislative priorities, with a pro-crypto Congress poised to influence policy.
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Word of the day
Lenient

Someone or something described as lenient is not harsh, severe, or strict. In other words, they allow a lot of freedom and leeway, and do not punish or correct in a strong way.

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