Which 1984 do we want? George Orwell’s cautionary tale about a society under constant surveillance by an oppressive government? Or the 1984 movie Footloose, where Kevin Bacon and his family move to a small town where dancing is illegal? We need to think about this before we ban TikTok.

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The lowdown

• 📉 Investors cheer as November's Consumer Price Index comes in at an annual 7.1%.

• 🎮 Microsoft offers to provide ‘Call of Duty’ to rivals for 10 years to appease FTC.

• 📱 US lawmakers move a step closer to banning TikTok amid spying concerns.

Featured Stories

Crypto audits are not financial audits

One lesson that appears to have been learnt from the FTX debacle is that there is a risk in allowing a crypto exchange to hold your assets for you. It may be better to hold assets in your own wallet.

The world’s largest cryptocurrency exchange Binance experienced $1.14 billion in net withdrawals on Tuesday. Binance CEO Changpeng Zhao has assured the crypto community that customer funds are backed by sufficient assets, and it is business as usual – there is even an audit report to back him up.

Earlier this month, auditing firm Mazars reached the conclusion that Binance indeed held enough bitcoin (and wrapped bitcoin) to cover user balances on the exchange.

The term audit usually refers to a financial audit – an assurance that financial statements are presented accurately and in accordance with generally accepted accounting principles. The Binance “audit” was in fact only an agreed-upon procedure. The audit firm had a very limited scope and could give only factual findings within the parameters Binance had predefined. In other words, it provides very little assurance about the existence of customer funds.

Of course, even financial audits performed by Big Four firms are not infallible. EY failed to identify that $2 billion did not exist when it audited Wirecard – and we are talking cash, not code.

The content we're consuming today

• Reuters: How a secret software change allowed FTX to use client money.

• The Wall Street Journal: Investors Are Losing Faith in Cathie Wood’s ARK Innovation ($).

Off-balance sheet items

• For the first time, more energy was produced by an experimental fusion reactor than was used to trigger the reaction — this could have massive implications for how we generate power. Listen to nuclear scientist Marv Adams explain what happened in this video.

The bottom line