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Germany prepares crisis plan for abrupt end to Russian gas - sources - Reuters News

Tech entrepreneur has emphasized free speech, leading to speculation he might relax content moderation on the social-media platform

Elon Musk said his plans for Twitter Inc. TWTR -3.69% are aligned with new European Union rules aimed at compelling social-media companies to do more to police illegal content, after his initial vision for the platform raised concerns among regulators in Europe.

Mr. Musk made the comments in a video posted Monday to the Twitter account of Europe’s commissioner for the internal market, Thierry Breton. Mr. Breton met Mr. Musk during a visit to Austin, Texas, where the two discussed the EU’s new Digital Services Act, or DSA, which lawmakers agreed to last month.

“I think we’re very much of the same mind,” Mr. Musk said in the video, in which he is standing with Mr. Breton. “Anything that my companies can do that would be beneficial to Europe, we want to do that.”

The new rules, which aren’t yet in effect, would require major social-media platforms to swiftly address illegal content and conduct regular risk assessments, among other measures, or face hefty fines.

Mr. Musk, the chief executive of Austin-based Tesla Inc. TSLA -9.07% whose $44 billion bid to buy Twitter was accepted last month, has previously said that he views the company as an important platform for free speech, leading to speculation that he intends to relax Twitter’s content moderation rules. Mr. Musk has said Twitter should be more cautious about removing content and permanently banning users, but hasn’t given precise details on how the company’s policies could change.

Twitter declined to comment. Mr. Musk didn’t immediately respond to a request for comment. He wrote on Twitter on Monday that his preference is “to hew close to the laws of countries” in which the company operates. “If the citizens want something banned, then pass a law to do so, otherwise it should be allowed.”

The exchange with Mr. Breton came two weeks after the EU official cautioned on social media and in interviews that a Twitter under Mr. Musk’s ownership would need to comply with the bloc’s new rules. “They can do whatever they want outside of Europe,” Mr. Breton said at the time. “But in Europe they will just have to fulfill rules and obligations which are very clear now.”

In the video Monday, Mr. Breton said he was “happy to be able to explain” the DSA to Mr. Musk. He said he thinks Mr. Musk understands the new rules well.

After Mr. Breton posted the video to Twitter, Mr. Musk responded, saying: “Great meeting! We are very much on the same page.”

Mr. Musk, at times, has had an adversarial relationship with U.S. regulators. For instance, he has criticized the Securities and Exchange Commission and has been seeking to overturn a settlement he agreed with the SEC in 2018. Mr. Musk also has made fun of the Federal Aviation Administration after it criticized Space Exploration Technologies Corp., the space launch company known as SpaceX that he runs, for launching a rocket without all the required paperwork.

In China, where Tesla has a large car factory, he has struck a more conciliatory tone. Tesla issued a humbling apology last year after a driver at an auto show publicly blamed Tesla brakes for an accident, after which China’s top legal-affairs agency chimed in, calling the company arrogant.

Drop causes ripples in ether and bitcoin, exacerbating recent declines in their dollar values

One type of cryptocurrency, a so-called stablecoin, is meant to keep its value at $1. But on Monday, the third-biggest stablecoin, TerraUSD, fell as low as 69 cents, causing a flood of investors to sell their holdings.

Stablecoins get their name from their being tied to the value of government-issued currencies, such as the dollar. These $1 pegs are usually backed by Treasurys, cash and other dollar debt that is easily sold in times of market stress.

More than $18 billion was invested in TerraUSD as of this past weekend, making it the third-largest stablecoin, according to crypto data provider the Block. But unlike traditional stablecoins, TerraUSD is an algorithmic stablecoin. These pseudo dollars aren’t necessarily backed by any assets at all, instead relying on financial engineering to maintain their link to the dollar.

Such designs have been criticized by market observers as risky because they rely on traders to push the value back to $1 rather than having assets that continuously support the price. If traders aren’t willing to buy them, coins can go into a so-called death spiral. TerraUSD has mostly maintained its dollar peg, but it has been broken in bouts of heavy volatility.

In TerraUSD’s case, if its price falls below $1, traders can “burn” the coin—or permanently remove it from circulation—in exchange for $1 worth of new units of another cryptocurrency called Luna. That reduces the supply of TerraUSD and raises its price. Conversely, if TerraUSD climbs above $1, traders can burn Luna and create new TerraUSD. That increases supply of the stablecoin and lowers its price back toward $1.

The break in the peg, which began over the weekend, started with a series of large withdrawals of TerraUSD from Anchor Protocol, a sort of decentralized bank for crypto investors, said Ilan Solot, a partner at crypto hedge fund Tagus Capital LLP. Anchor Protocol—which is built on the technology of the same Terra blockchain network that TerraUSD is based on—had been a major factor in the growth of the stablecoin in recent months, by allowing crypto investors to earn returns of nearly 20% annually by lending out their TerraUSD holdings.

In tandem with the big withdrawals, TerraUSD was also being sold for other stablecoins backed by traditional assets through various liquidity pools that contribute to the stability of the peg, as well as through cryptocurrency exchanges.

Bitcoin’s volatility has limited its adoption for payments, so entrepreneurs created stablecoins: cryptocurrencies pegged to assets such as the U.S. dollar. But the recent settlement of a probe into the most popular stablecoin, tether, shows the need for transparency in the growing industry. Photo illustration: Sharon Shi/WSJ

The dislocation of TerraUSD from its peg caused some traders to panic and sell. To reinstate the peg, others began selling ether and buying TerraUSD, weighing on the dollar value of the second-largest cryptocurrency by market value. Some traders also sold bitcoin over the weekend in anticipation that the platform would need to sell its bitcoin reserves to support the peg, Mr. Solot said. Bitcoin fell 10% Monday to about $31,076 amid a broad selloff in the crypto markets.

TerraUSD in Monday evening trading was at about 80 cents, after touching the low of 69 cents earlier, according to CoinMarketCap. Panic selling also hit the related Luna cryptocurrency, which plunged 50% from Sunday to Monday, wiping out more than $10 billion of market value, CoinMarketCap data show.

The Luna Foundation Guard, a nonprofit supporting Terra, said it voted to support TerraUSD by lending $750 million of bitcoin to trading firms to protect the stablecoin’s peg and lending out an additional 750 million in TerraUSD to buy more bitcoin.

​Do Kwon, the South Korean developer behind TerraUSD, co-founded the Luna Foundation Guard and said this year it would run a huge bitcoin reserve fund that would spend heavily if needed to protect the stablecoin’s peg. His company, Terraform Labs, has donated several billions of dollars of crypto to the nonprofit.

“Deploying more capital—steady lads,” Mr. Kwon tweeted on Monday.

The selloff might have stemmed from someone or a group of people trying to break the peg, Mr. Solot of Tagus Capital said. Regardless of the cause, he doesn’t expect TerraUSD to return to $1 immediately since a queue of sell orders are still waiting to be processed.

“I don’t think this peg is going to come back soon,” he said. “There’s so much [TerraUSD] still to come out of the system, and that’s going to continue putting pressure on the peg.”

Residents say authorities in Shanghai, now in its sixth week under strict lockdown, have begun forcing more people into centralized quarantine facilities

HONG KONG—After six weeks of strict lockdown, Shanghai authorities are again tightening Covid-19 restrictions amid a renewed push by central-government officials to eradicate the virus, sparking a new wave of frustration in the coastal city of 25 million people.

Though Shanghai officials haven’t formally announced any new citywide measures, residential communities and grass-roots authorities have expanded the scope of people being taken into centralized quarantine while cutting off deliveries of nonessentials to swaths of the city, according to half a dozen Shanghai residents who have received notices and shared them with The Wall Street Journal.

On Sunday and Monday, many residents received written statements and messages from neighborhood committees that manage residential communities announcing a “quiet period,” effective immediately and lasting between three and seven days, depending on the neighborhood, during which most deliveries would be halted and residents would be barred from stepping outside.

The abrupt halt in deliveries is a blow to the city’s homebound residents, tens of millions of whom have relied on deliveries as a lifeline during the extended lockdown. One residential community in Shanghai’s Xuhui district halted the distribution of medicine to residents during its three-day “quiet period,” according to a notice seen by the Journal. Authorities at another community in Huangpu district asked residents to inform them if they had any essential medicine deliveries so that they could make alternate arrangements, according to the notice, which was seen by the Journal.

Separately, Shanghai residents over the weekend began sharing their experiences of having been forced into temporary isolation facilities or hotels after their neighbors tested positive for Covid-19. A hashtag on China’s Twitter-like social-media platform Weibo reading: “If one person tests positive, the whole building isolates,” has garnered more than five million views since Saturday.

Some said their apartment units were either next to, above or below the apartment of someone who had tested positive for Covid-19. Some said they live on the same floor and some in the same building. Two Shanghai residents said they knew people who had been taken away to quarantine after a neighbor had tested positive. The Journal couldn’t independently verify those claims.

The Shanghai government didn’t respond to a request for comment.

The tightened measures in Shanghai come as daily Covid-19 cases in the city have dropped after six weeks of severe restrictions on people’s movement. On Monday, Shanghai authorities reported 3,947 new infections for the previous day, marking the sixth consecutive day that cases were below 5,000. The city, which is battling China’s worst outbreak since the virus emerged in China two years ago, has recorded more than 620,000 cases and 547 deaths since March 1.

Despite the steady decline in infections, Shanghai authorities’ tighter measures appear to be a response to a renewed push by senior Communist Party officials in Beijing to smother any traces of the highly transmissible Omicron variant of the coronavirus. Following a meeting Thursday, the Communist Party’s Politburo Standing Committee, China’s top decision-making body, compared the pandemic measures in Shanghai with a war that must be won.

After the meeting in Beijing, Shanghai’s top Communist Party and municipal officials echoed that language, vowing to follow orders and triumph in what they called the “Great Shanghai Defensive War.” Employing military metaphors, the officials, led by Shanghai’s Communist Party chief Li Qiang, pledged to “set down military orders and overcome 10,000 difficulties to charge forward in attack!”

Shanghai has been trying to contain all infections to isolation facilities, with the aim of eliminating every Covid-19 case in the wider community before reopening. But it has been struggling to do so.

Forcibly transferring neighbors of infected people to centralized quarantine would mark an escalation from the current practice of transferring only those who have tested positive for Covid-19—and, on occasion, those who live with them. That policy had already triggered widespread criticism for forcing the elderly into poorly equipped temporary isolation facilities without providing access to appropriate care.

As Shanghai authorities’ restrictions have gotten tougher, some prominent voices in the city have begun to openly question the legality of the measures.

Tong Zhiwei, a professor of constitutional law at Shanghai’s East China University of Political Science and Law, wrote in a widely circulated open letter, which he shared on several chat groups on Sunday, that practices such as forcing residents into quarantine can’t be undertaken without formal approval from the State Council, China’s cabinet, or the Standing Committee of the National People’s Congress, its legislature.

Mr. Tong confirmed in a phone interview that he had written the letter, which disappeared from Chinese websites almost as soon as it was shared by others. Mr. Tong said in the interview that some residents had reached out to him to express concerns that their personal freedoms were being threatened by Shanghai’s Covid-19 control measures. “As someone who studies constitutional laws, I feel a responsibility to speak up,” he said.

Another open letter, attributed to Liu Dali, a corporate lawyer in Shanghai, and addressed to the Shanghai Municipal People’s Congress, the city’s local legislative body, also circulated widely online on Sunday. The letter called on authorities to reverse the policy of quarantining neighbors of infected patients, which he said the government was enforcing without any formal announcement. The letter said the measures infringed on people’s basic rights, wouldn’t help the fight against the pandemic and didn’t give residents time to prepare. Mr. Liu couldn’t be reached for comment by phone or through his WeChat account. Three people who know Mr. Liu said he had written the letter.

The letters struck a nerve among frustrated Shanghai residents after a month and a half of strict lockdowns. The decline in cases had raised hopes that pandemic measures could ease further, but the new round of tightening has pushed that prospect further into the future.

On Chinese social-media platforms, videos of officials in white, full-body protective medical suits announcing and enforcing what appeared to be the new rules circulated widely, prompting further anger and confusion.

“Residents, please don’t go out. If one person gets positive, everyone in the building will be taken away,” officials could be seen shouting while patrolling a neighborhood in a video on Douyin, the domestic version of short-video platform TikTok.

Another video showed police officers in protective suits telling residents living on the same floor with a confirmed Covid-19 case that they too would be transferred to a centralized quarantine facility.

“I hope you cooperate. Only when you don’t cooperate will we force you to be transferred,” one man is heard saying in the video. “But we are not sick,” a woman replied. The authenticity of the videos couldn’t be verified.

Across the city, public-health measures haven’t always been consistent and, even before the latest measures, some residents in Shanghai had reported signs of tightened rules.

Xu Ziwen, a 37-year-old finance employee who lives in central Shanghai’s Huangpu district, said her compound had reported no infections before the lockdown but has since reported hundreds of cases. On Saturday, 33 of the 35 buildings in her apartment complex—where positive cases had been detected—were boarded up with wooden planks and locked by men in white protective suits, she said. Her account couldn’t be independently confirmed.

“What if there is a fire?” she said. She said she has only been allowed to leave her apartment unit twice since March 15, other than to do Covid-19 tests.

One woman, a 30-year-old teacher in Shanghai who asked to only be identified by her surname Wu, said after positive cases were found on three floors of her apartment building in Shanghai’s Minhang district earlier this month, all residents on those three floors were transferred to a serviced apartment for quarantine.

“I am really scared,” she said. “I don’t know who lives next to me. What if the person who lives next door is positive?”

Silkscreen of iconic movie star commands highest-ever price for work by an American artist

Market regime change is here. It won’t be pretty.