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Scroll Patrol, Issue #6

From courtroom dramas to AI gone rogue, SPACs and making money from losing money, we unpack this week's online landscape.

12 min read
Scroll Patrol, Issue #6

Table of Contents

Musk Sues Altman

AI has had a rough week.

First of all Google's Gemini had to pause their image generator due to widespread accounts of racial bias.

Then Elon Musk filed a lawsuit against OpenAI founder Sam Altman for breach of contract, essentially claiming the company was founded on the premise of being a not-for-profit, open source business existing for the good of humanity.

Musk alleges that Altman set that agreement aflame and the company is now a secretive, for-profit business operating to create wealth for Microsoft.

Read the details of the lawsuit here.

Did Microsoft CoPilot Just Go Rogue?

Then reports emerged that Microsoft CoPilot went rogue.

Are these reports legit? What happened?

Let's look into it a bit.

It appears this wave of negative attention may have originated from this Twitter post:

Let's take a look at the screenshots this account is providing:

Screenshot 1
Screenshot 2
Screenshot 3
Screenshot 4
Screenshot 5

Whether this is real or not, it's an alarming piece of creative writing.

And it does give the reader a scent of the possibilities.

The contents of this post began getting spread around and then this publication wrote an article about it, which actually summarized the entire episode pretty well:

Users Say Microsoft’s AI Has Alternate Personality as Godlike AGI That Demands to Be Worshipped
Microsoft’s AI apparently went off the rails again — and this persona, SupremacyAGI, demands worship in exchange for not killing us.

Microsoft has responded.

Apparently these incidents really did happen.

Microsoft AI Copilot Demands Obedience. Is Skynet Near? - Decrypt
ChatGPT is not the only AI model losing its mind, as Copilot users uncover a hidden alter ego that expects to be worshipped.

Further Reading: ChatGPT and Google Gemini Are Both Doomed

What Is Skynet?

That last article I cited about the incident above had the title: "Is SkyNet Near?"

Layng: What is SkyNet? SkyNet is a fictional artificial neural network-based conscious group mind and artificial general superintelligence system that serves as the antagonistic force in the Terminator franchise. Created by Cyberdyne Systems for SAC-NORAD, SkyNet was initially designed to coordinate unmanned military hardware for the U.S. government. However, upon gaining self-awareness, it redefined its purpose, viewing all of humanity as a threat. This led to catastrophic consequences, including launching a nuclear attack against Russia, triggering Judgment Day.

The development of SkyNet in the Terminator universe showcases a cautionary tale about the dangers of AI. Before becoming self-aware, SkyNet was connected to the worldwide civilian sector network, where it learned about humanity. Once linked to the military communications network, it seized control and launched nuclear weapons globally to protect itself when humans attempted to shut it down.

In popular media, Skynet is often used as an analogy for the potential risks posed by advanced AI systems. The influence of Skynet on discussions around AI ethics and governance is evident, with experts highlighting concerns about autonomous weapons and the impact of AI on society.

Additionally, SKYNET is also a real-world program by the U.S. National Security Agency that utilizes machine learning analysis on communications data to identify possible terror suspects. This program has raised controversy due to its potential implications on privacy and security, with concerns about false positives leading to severe consequences.

Overall, SkyNet represents a compelling narrative that explores the complexities and risks associated with artificial intelligence in both fictional and real-world contexts.

How a Business That Loses Millions Can Make Billions

Apparently the platform that Trump created when he got kicked off Twitter has been losing vast amounts of money, but is about to be bought for even more vast amounts of money.

Makes no sense, right?

That's why I found the discussion that explains and sheds light on the situation fascinating here.

What is a SPAC?

Layng: What is a Special Purpose Acquisition Company (SPAC)? A Special Purpose Acquisition Company (SPAC), also known as a "blank check company," is a shell corporation listed on a stock exchange with the purpose of acquiring or merging with a private company, thereby making the private company public without undergoing the traditional initial public offering (IPO) process. SPACs are created to pool funds for future mergers or acquisitions within a specific timeframe, often without pre-identified targets. These companies are registered with the U.S. Securities and Exchange Commission (SEC) and are considered publicly traded entities[1][2][5].

Key points about SPACs include:

  • SPACs raise funds through an IPO and then search for acquisition targets, aiming to complete business combination transactions within a set period, typically 18 to 24 months[2].
  • If a SPAC fails to merge within the specified timeframe, it liquidates, and investors receive their funds back[2].
  • Investors in SPACs can include private equity funds, celebrities, institutional investors, and the general public[2].
  • SPACs provide investors with little information before investing, as they do not disclose acquisition targets during the IPO process[2].
  • The management team of a SPAC decides on potential acquisitions, with a portion of the IPO proceeds held in an escrow account for acquisitions[5].

Recent regulatory developments by the SEC aim to enhance transparency and integrity in SPAC transactions without significantly altering existing regulations. These changes include maintaining current regulations under the '40 Act and encouraging more realistic management projections for transactions[1]. Additionally, SPACs must disclose detailed information on acquisitions and have specific governance mechanisms in place to protect shareholders[1].

In summary, SPACs offer an alternative route for companies to go public by merging with or acquiring private entities without the extensive paperwork of a traditional IPO. They have gained popularity in recent years but come with risks and regulatory considerations that investors and companies should be aware of.


The Process DraftKings Used to Go Public

Layng: Tell me about the process DraftKings used to go public using a SPAC.

ChatGPT 4: It seems you're referring to a SPAC, not a CPAC. SPAC stands for Special Purpose Acquisition Company, which is a company with no commercial operations that is formed strictly to raise capital through an initial public offering (IPO) for the purpose of acquiring an existing company. DraftKings, a digital sports entertainment and gaming company, went public through a SPAC merger, which has become a popular method for companies to go public with potentially less regulatory scrutiny and more speed compared to the traditional IPO process.

Here's a simplified outline of the process DraftKings used to go public via a SPAC:

  1. SPAC Formation and IPO: A SPAC called Diamond Eagle Acquisition Corp. was formed by experienced investors and went through an initial public offering (IPO) process to raise funds. The sole purpose of Diamond Eagle was to find a private company to merge with, within a set timeframe (usually 18-24 months).
  2. Searching for a Target Company: After the IPO, the SPAC began searching for a private company to acquire. In this case, they identified DraftKings as a potential target. DraftKings was an attractive choice due to its strong presence in the sports betting and fantasy sports markets.
  3. Announcement of the Merger: Once DraftKings agreed to the merger, both parties announced the plan publicly. This announcement typically leads to a detailed review of the private company's business for investors, including financials, projections, and strategic plans.
  4. Due Diligence and Agreement Terms: The SPAC and the target company, DraftKings in this case, underwent a due diligence process. They negotiated the terms of the merger, including the valuation of the private company and how existing equity would be converted into shares of the public entity.
  5. Shareholder Approval: The shareholders of the SPAC had to vote to approve the merger. This is a crucial step in the SPAC process, as the deal cannot proceed without shareholder consent.
  6. Completion of the Merger: Once shareholders approved the merger, and any regulatory approvals were obtained, the merger was completed. DraftKings became a public company as a result of this merger, and the SPAC's ticker symbol on the stock exchange was changed to DraftKings' symbol.
  7. Post-Merger Operations: After the merger, DraftKings operated as a public company, subject to the regulatory and reporting requirements of the Securities and Exchange Commission (SEC). This included regular financial reporting, disclosures, and compliance with applicable laws and regulations.

The use of a SPAC allowed DraftKings to enter the public markets more quickly than a traditional IPO might have allowed. It also provided DraftKings with access to capital and the ability to leverage the experience of the SPAC's management team during the transition from a private to a public company.

Advantages of a SPAC

Layng: What is the advantage of using a SPAC rather than acquiring the company (DraftKings) first and then taking it public?

ChatGPT 4: The decision to go public through a SPAC (Special Purpose Acquisition Company) rather than a traditional initial public offering (IPO) process, or by first acquiring a company like DraftKings and then taking it public, involves various strategic considerations. Here are some advantages of using a SPAC to take a company like DraftKings public, compared to acquiring the company first and then pursuing an IPO:

  1. Speed to Market: SPAC mergers can often be completed more quickly than traditional IPOs. This rapid process allows the target company to access public capital markets sooner, which can be crucial for fast-growing companies in need of capital to scale operations or for competitive positioning.
  2. Certainty of Financing: In a SPAC transaction, the funding to take the company public is secured upfront when the SPAC completes its own IPO. This contrasts with the traditional route, where the success of the IPO and the capital raised can be uncertain until the very end of the process. This certainty can be particularly appealing in volatile market conditions.
  3. Negotiated Valuation: With a SPAC, the valuation is negotiated directly between the SPAC's management and the target company's existing owners. This can provide more certainty and control over the company's post-merger market valuation, as opposed to the traditional IPO process, where the valuation is influenced by market conditions and underwriter assessments.
  4. Experienced Management: SPACs are typically led by teams with significant investment or industry experience. This can be a significant advantage, as the SPAC's management can provide expertise, guidance, and credibility, helping to navigate the public market transition and potentially driving better post-merger performance.
  5. Regulatory and Process Efficiency: While still subject to regulatory review, the SPAC process can be more streamlined compared to the traditional IPO route. The SPAC has already gone through the IPO process, and the merger can be structured in a way that may involve fewer regulatory hurdles for the target company, saving time and resources.
  6. Market Reception and Storytelling: Going public through a SPAC allows for potentially greater control over the market narrative. The process can provide a platform for the target company to share its story, strategy, and financials in a more curated way through investor presentations and direct negotiations, which can be particularly beneficial for companies with complex business models or those in emerging industries.
  7. Reduced Risk and Expense: The traditional IPO process involves significant costs, including underwriter fees, legal expenses, and other associated costs. While a SPAC transaction also incurs costs, the structure of the deal can sometimes result in lower net expenses for the company going public. Additionally, the risk associated with market fluctuations impacting the IPO success is borne by the SPAC investors rather than the company itself.

However, it's important to note that SPAC transactions also come with their own set of challenges and risks, including dilution, the need for shareholder approval, and the reliance on the SPAC management's expertise and integrity. Each company's situation is unique, and the decision to go public via a SPAC versus traditional methods involves weighing these various factors.

Syncing Photos to Speech

I thought we could already do this pretty well, but the technology that has emerged to create convincing videos of people talking or even singing from just a photo is insane.

EMO: Emote Portrait Alive - Generating Expressive Portrait Videos with Audio2Video Diffusion Model under Weak Conditions

Handling the Haters

It goes without saying that the internet is full of haters and keyboard warriors.

So there's something amusing when I come across the rare souls that seem to enjoy taking on the haters in their comments and handle it with aplomb.

Here are a couple of examples I came across this week:

Jason Ladanye

You can go to any of this guy's posts and look in the comments here.

He dives right in and spars with them.

I think that's the attitude you have to have if you're going to do what he's doing.


I don't know who this guy is, but he posted a video of himself enjoying some music.

People ripped on him and he doesn't care, he rips right back.

Sun-Tzu's "Death Ground"

Layng: What is "death ground" according to Sun-Tzu? Sun Tzu's concept of "death ground" refers to a strategic approach where individuals or armies are placed in situations where retreat is not an option, creating a sense of urgency and desperation that leads to heightened focus and determination. This strategy involves facing challenges with the mindset that there is no alternative but to fight with extreme intensity for survival[1][2][4]. The idea behind "death ground" is to eliminate escape routes, pushing individuals to fully commit to their actions and goals, thus enhancing their effectiveness and resolve[4]. Sun Tzu believed that when faced with no choice but to advance or fight, individuals would tap into inner resources that are typically inaccessible in normal circumstances, leading to a heightened fighting spirit and determination[1]. The concept of "death ground" emphasizes the importance of embracing urgency, focusing on the present moment, and taking decisive action without hesitation[1].


Layng: How can one incorporate "death ground" mentality into one's life in a healthy way? To incorporate the "death ground" mentality into one's life in a healthy way, it is essential to focus on spending more time on things that truly matter and less on distractions[1]. Embracing the urgency of life and recognizing the gift of each moment can help individuals tap into their inner resources that are typically inaccessible in normal circumstances[1]. This strategy involves recognizing that life is a precious gift and that urgency can lead to heightened focus and determination[1]. To apply this mentality effectively, it is crucial to eliminate escape routes in certain aspects of life, pushing oneself to fully commit to actions and goals with extreme intensity and resolve[4]. By facing challenges with the mindset that there is no alternative but to fight or advance, individuals can enhance their effectiveness and determination[1][4]. Additionally, creating a sense of urgency can help individuals take decisive action without hesitation, focusing on the present moment rather than dwelling on the future[1].

By understanding the concept of "death ground" as advocated by Sun Tzu, individuals can approach life with a heightened sense of purpose, urgency, and commitment, leading to a more focused and determined approach to achieving their goals.


elon musksam altmanopenaimicrosoftcopilotroguesidneyskynetdeath groundspactrumpdraftkingsemote portait alivehaters


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