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Tesla Model 3 Source: Tesla

Car rental giant Avis just sent an email out today to its customers to let that it has new rental terms and conditions for its fleet EVs. Some of the company’s EV rules are a bit of a head scratcher.

Here’s what the email said:

As we introduce Electric Vehicles to our fleet, our rental terms have been amended. To accommodate our expanding vehicle inventory, this amends the agreement signed by you with respect to the rental of a vehicle powered by an electric motor (an “EV”). Our updated terms can be found here.

Note that these were sent out by Avis Canada, but the rental terms and conditions are for both the United States and Canada.

I’ve pasted the seven-plus points terms included in the EV section below, and my comments are after each point, in bolded italics:

39. ELECTRIC VEHICLE (EV) TERMS. This EV Amendment amends the rental agreement signed by you with respect to the rental of a vehicle powered by an electric motor (an “EV”) from Avis Rent A Car System, LLC, Aviscar, Inc., or any Avis Rent A Car System, LLC, affiliate, or the independent Avis Rent A Car System, LLC, licensee identified on the rental agreement (collectively referred to herein as “Avis”).

Boilerplate text. All good. Next.

1) AMENDMENT TO RENTAL AGREEMENT: This EV Amendment simultaneously amends the terms of your rental from Avis with respect to the terms herein only.  All other terms of your rental remain in full force and effect. In the event of any conflict between the terms of this EV Amendment and your other rental terms, the terms of this EV Amendment shall govern.

More boilerplate. Nothing to see here.

2) ONE WAY RENTALS ARE NOT PERMITTED:  Due to unique infrastructure needs associated with EV’s, your EV must be returned to your rental location on the date/time specified in your rental terms.  If your EV is not returned to the renting location, all costs incurred in transporting your EV back to the renting location will be assessed to you.  In addition, you will be assessed a fee for Avis’ loss of use of the EV between the time that you should have returned the EV to the renting location and the time that it is returned to the renting location up to a maximum of thirty (30) days. The loss of use fee will be your daily rental rate.

“Unique infrastructure needs.” LOL.

At the end of January, a couple of us at Electrek received a PR announcement announcing that Avis was launching a “significant number of EV charging stations at the George Bush International Airport in Houston” with EverCharge. The EV charging stations will “only be used by the Avis and Budget fleets of EVs and PHEVs available for rent” at Houston airport.

I asked, “How many EVs does Avis have for rent across the US, and which makes and models?” And got the reply: “Avis is not commenting on the specifics of its fleet at this time.”

Bummer, because Hertz sure is commenting, and with Tom Brady to boot.

I asked the spokesperson how many EV charging stations Avis is installing at Houston airport, and they wouldn’t tell me – they only said that both DC and Level 2 are being put in.

I asked what the rollout plan is for other North American airports, and got the reply:

Following the launch at the Houston airport, Avis and EverCharge plan to extend the partnership to additional airport locations this year.

So, based on the above information, it would appear that the reason why a car rental customer has to return the EV to the original rental location – in this case, airports – is because Avis doesn’t have enough EV charging infrastructure yet.

I get that this is a growing pains issue, but simply, it isn’t very practical. Not everyone returns to the place where they rented a car.

Maybe Avis should have installed more EV charging infrastructure before it rolled out its unknown quantity of EVs.

One can currently rent a Tesla Model 3 from Avis in seven US states – all in the West. It’s kind of silly that one can’t drive between those locations without having to return to home base.

3) BATTERY CHARGING LEVELS AT VEHICLE CHECK OUT: Avis will rent the EV with at least a 70% charge on the battery.  The range of your EV will vary based on a number of factors including vehicle load, driver’s actions such as speed and acceleration, climate and terrain factors such as inclines.  Avis does not warrant or guarantee the range of an EV.

Why 70%? The ideal topped-up charge level is 80%. If Avis has EV chargers at its rental locations, then it should charge them to 80%.

And Avis ought to print up a helpful document, or give renters a QR code, so they can read about why and how vehicle load, speed, and acceleration affect charge. Let’s not say there are factors without explaining them.

4) BATTERY CHARGING LEVELS AT VEHICLE RETURN:   Your EV must be returned to Avis with a battery charge level of at least 70%.  If returned at less than 70% but more than 10% battery charge level, a charging fee of $35 will be assessed to you.  If returned with less than a 10% battery charge level, you will be assessed an additional low charge fee of $35 (a total of $70 charging fees if returned with a battery charge of less than 10%). The charging fee is based on the kilowatt hours, overhead, loss of use of the EV and administrative costs Avis incurs in charging the vehicle.  Note:  fees assessed in the United States refer to U.S. dollars and fees assessed in Canada refer to Canadian dollars.

A $35 car charging fee is a bit steep. Let’s say a driver returns the car with 50% charge – the amount of money to bring it to 70% would be around US $5 at the most.

An 80kwh Tesla battery x 20c/kwh (high estimate) = $16 assuming 0-100% charge.

But I guess this is like when you bring a gas car back empty without prior arrangements, and car rental companies charge you a really high fill-up fee. And if Avis has DC chargers, then they won’t have to wait long to charge up a car that has a battery charge level of less than 70%.

5) ROADSIDE ASSISTANCE:   Roadside assistance is available for your EV but fuel cannot be delivered to EV’s.   If you require roadside service because you depleted your EV’s batteries, your EV will be towed to your renting location and the towing expense will be assessed to you.   If you require another vehicle due to a breakdown, you may be provided a gasoline powered vehicle in which case, all fuel provisions of your rental terms shall apply with respect to your replacement vehicle.

“Fuel cannot be delivered to EVs” – heehee. Love it. It would be cool if Avis invested in some mobile EV charging trucks to make up for the fact that they don’t actually have enough EV charging infrastructure yet to service their EV fleets.

Why can’t the EV be towed to the nearest Tesla Supercharger or Electrify America or similar? Why does it have to go all the way back to the renting location? What if the driver is on a road trip? This one definitely qualifies as weird. This may scare some people off who wanted to try an EV for the first time.

6) SPECIAL EV EQUIPMENT:  All EV equipment including, but not limited to, charging equipment, keys, key cards, fobs and/or remote (“EV Equipment”) provided with your EV must be returned.  The full replacement cost of any EV Equipment not returned with your EV will be charged to you.  LDW, even if elected, does not cover EV Equipment.

Maybe this is a legal thing, but surely it would be common sense that keys, key cards, and fobs would have to be returned, much like any gas rental car? Perhaps Avis has experienced some customers throwing away key cards because they think they’re like hotel key cards? At any rate, I’d be pretty annoyed if I was an Avis employee and customers kept throwing away the key cards, so fair enough. Fobs is a bit of an overstretch. I guess they just had to mention them to cover backs.

7) UNIQUE TESLA TERMS:  If you rented a Tesla EV, you will be able to access Tesla Superchargers, subject to availability, to recharge Tesla vehicles provided, however: 1) any fees, charges and/or costs to access and utilize the Tesla Superchargers shall be your responsibility; 2) any Tesla “idle fees”, as defined and charged by Tesla, shall be your responsibility (see Tesla’s website for details https://www.tesla.com/support/supercharger-idle-fee); and 3) the provisions of “Battery Charging Levels at Vehicle Return” shall continue to apply to you.

These are fair terms, because they’re essentially Tesla terms 101.

TESLA VEHICLES MAY NOT BE WASHED AT AN AUTOMATIC CAR WASH. ANY DAMAGE CAUSED BY AN AUTOMATIC CAR WASH SHALL BE ASSESSED TO YOU PURSUANT TO THE “DAMAGE/LOSS TO THE CAR” PROVISIONS OF YOUR RENTAL TERMS AND WILL NOT BE COVERED BY LDW.

I love the bold capital letters for the CAR WASH RULES. One can take Teslas through car washes, but only in touchless car washes. Teslas have Car Wash Mode.

Maybe Avis decided that putting its Teslas into Car Wash Mode is too complicated for its customers and too much like hard work for its reps to explain how to use the feature to every EV renter? It’s never occurred to me to take a rental car to a car wash, but I’m not fastidious with my cars. I’d love to hear your thoughts on this car wash thing in the comments below.

Photo: Tesla


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Bitcoin miners brace for impact as halving goes live

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Bitcoin miners brace for impact as halving goes live

The Bitcoin halving is set to shake up the crypto's price and the network's miners

AUSTIN, TEXAS — Adam Sullivan left investment banking to mine bitcoin at an awkward time. It was May 2023, bitcoin was trading at around $21,000, U.S. regulators were in the thick of cracking down on the sector writ large, and Core Scientific, the company he had agreed to take over, was battling angry lenders in a Texas bankruptcy court over tens of millions of dollars in outstanding debt.

But Sullivan knew that, with a lifeline, he could get the business to a much better place. That’s because the halving was on the way, and with it would likely come a big rally in bitcoin.

Late Friday night, the bitcoin code automatically cut new issuance of the world’s largest cryptocurrency in half. It happens roughly every four years, and in addition to helping to stave off inflation, it historically precedes a major run-up in the price of bitcoin.

The technical event is relatively simple: Bitcoin miners get paid in bitcoin to validate transactions, and after 210,000 blocks of transactions are computed and added to the main chain, the reward given to the miners securing bitcoin is ‘halved.’

There are more than a dozen publicly traded miners on the network and thousands of smaller, private ones around the globe, constantly racing to process transactions and get paid in new bitcoin. Because the event leads to a cut to rewards paid to miners directly, they’ll be the first ones to feel the impact of the halving.

The price of bitcoin has touched new all-time highs after each “halving” event.

CNBC

Typically, when the halving cuts supply, it’s led to huge rallies for bitcoin.

In fact, the previous (and only) three halvings in the chain’s history have come before every bull run, in which the coin has touched new all-time highs and a surge of investors have entered the market for the first time.

That rapid price increase has helped many miners stave off the worst since it tends to offset the impact of having the block prize cut in half.

“As a company that was already in the process of scaling our infrastructure during the previous halving, we know the toll that halvings can take on a company if it is not adequately prepared,” Core’s Sullivan told CNBC.

The aggregate market cap of the 14 U.S.-listed bitcoin miners tracked by JPMorgan analysts declined 28% over the first half of April to $14.2 billion, reaching year-to-date lows. Bitdeer was the best-performing stock over the period, down around 20%, versus Stronghold Digital, which was 46% lower.

Some have billed the 2024 bitcoin halving as a seminal moment for the mining sector. Depending on how much prep work miners have done, it could easily make or break them.

“Being prepared for a halving means evaluating all of your power strategies, all of your software capabilities, all of your operations,” continued Sullivan.

Others are less concerned given recent price moves in bitcoin.

In a research note from Needham on Apr. 16, analysts said they expect the halving to only have a modest impact to miners’ estimated EBITDA margins, despite the 50% reduction in revenue, since the price of bitcoin has been trading in the range of $60,000 to $70,000.

“We expect geopolitical tensions and interest rate policy to be the biggest near-term drivers of crypto price action,” Needham analysts wrote, adding that at a bitcoin price above $60,000, the halving is “derisked for nearly all public miners.”

The bank did, however, single out their preference for low-cost bitcoin producers like Riot Platforms, Bitdeer, and Cipher Mining. Meanwhile, if bitcoin prices fall, Needham says the most outsized native impact will be felt by higher cost producers that are also levered to higher bitcoin prices via large treasury holdings.

Analysts from JPMorgan echoed a similar sentiment, writing in an Apr. 16 research note that they think “recent weakness offers an attractive entry point” for investors and that they are “especially bullish” on Riot, which they believe offers attractive relative valuations.

The 14 U.S.-listed miners tracked by JPMorgan account for around 21% of the bitcoin global network.

Power supply for Whinstone’s bitcoin mine in Rockdale, Texas.

Years spent bracing for the halving

Miners have had years to prepare for the halving, including seeking lower power costs and upgrading their fleets to more efficient machines.

“Bitcoin’s halving happens like clockwork every four years,” said Haris Basit, chief strategy officer of Bitdeer Technologies Group. “It’s a known variable that is a benchmark for us to remain focused on operational excellence.”

To that end, the Singapore-headquartered mining firm has invested in new data centers, but its core strategy has been to increase vertical integration through research and development. 25% of its staff is focused on R&D efforts, which Basit says have “led to new innovations and revenue pathways, such as our recently announced 4nm mining rigs and AI Cloud offerings.”

Analysts at Cantor Fitzgerald recently named Bitdeer as having one of the industry’s lowest “all-in” cost-per-coin.

Greg Beard, the CEO and Chairman of Stronghold Digital Mining, tells CNBC that miners whose only lever is more efficient machines will be at a disadvantage.

“Miners who own their low-cost power are better positioned,” said Beard. “Operational costs will be lower, allowing them to be more flexible with their capital.”

Core’s Sullivan agrees, noting that bitcoin mining data centers in the future will work hand-in-glove with power generators and grid operators to serve as a virtual battery for grid operators – allowing them to increase base load, curtail bitcoin data centers when they need to, and avoid peak generation loads, which he says are dirty and expensive.

“We own and operate our infrastructure, giving us greater control over operational and strategic decisions, such as the potential to expand into high-performance computing hosting,” said Sullivan.

Core Scientific, which launched in 2017 and now manages seven mining sites in five U.S. states, also owns the full technology stack. The company has been looking to diversify its revenue streams beyond purely bitcoin. Sullivan says that existing data centers offer reconfiguration opportunities to accommodate new types of high-value compute. 

“Certain data centers are located in close proximity to major metropolitan areas, making them candidates for low-latency, high-value compute applications,” said Core’s CEO.

Bitdeer’s bitcoin mine in Rockdale, Texas.

Riot Platforms CEO Jason Les told CNBC that preparation for the halving came down to the company’s long-standing focus on achieving a low cost of power, strong balance sheet, and significant scale of operations. Les says that’s what has positioned the firm to both withstand the halving with positive margins and be well positioned for upside on the other side of it.  

“Our new Corsicana Facility was energized just this week, and we will be significantly scaling up our hash rate with next-generation equipment at that new site over the remainder of the year,” said Les. “As a result, we are positioned to mine more bitcoin per day at the end of the year than we do today, despite the halving.”

Marathon Digital, which has grown more than 70% in the last year, took a different approach to scaling the business than its rivals. CEO Fred Thiel tells CNBC that the company grew quickly using an asset-light approach, where Capex was spent on mining rigs rather than infrastructure. 

“In December, we owned less than 5% of the sites where we were hosting our miners,” said Thiel. “Today we now own 53% of our total 1.1 gigawatts of capacity, having purchased it at less than the build and replacement cost.”

Owning sites lowers Marathon’s cost to mine by up to 20% on a marginal cost basis. Thiel also noted that by the end of 2024, Marathon expects to further improve efficiency by 10% to 15% as they deploy the next generation rigs across their new sites. 

That boost to efficiency isn’t just about new gear, however. The firm is deploying its custom firmware, which allows it to operate even more efficiently. 

Marathon, along with other mining firms, has begun diversifying its business model into ancillary operations beyond purely bitcoin mining.

Thiel says the company recently launched an energy harvesting division, where they are compensated to convert stranded methane and bio-mass into energy and then sell heat back into an industrial or commercial process, which essentially subsidizes and lowers our cost to mine significantly. Marathon expects this new business line to generate a significant portion of its revenues by the halving in 2028. 

Blockstream's Adam Back on teaming up with Tesla and Block to mine bitcoin with solar power

Diversifying revenue

The April 2024 bitcoin halving looks a lot different than the three that came before it.

For years, increased competition resulting from new miners coming online has been cutting into profits, because more miners means more people are sharing the same pool of rewards.

In a research note from JPMorgan on Apr. 16, analysts note that the network hashrate, a proxy for industry competition and mining difficulty, was up 4% in April from the month before. Stronghold’s Beard says the halving is a headwind dwarfed by the global hashrate increasing nearly five-fold from the last one in May 2020.

“Mining is a tough industry especially because there are a lot of nation states that have extra power power and they’re dedicating it to mining,” said Nic Carter of Castle Island Ventures. “It’s a free market, anybody can enter into it as long as they basics.”

U.S. spot bitcoin exchange-traded funds have also significantly shifted the pricing dynamics. In years past, the price of bitcoin didn’t surge until after the halving. But in the wake of record flows into these spot bitcoin funds, the world’s largest cryptocurrency touched a fresh all-time-high above $73,000 in March.

“The recently approved Bitcoin ETFs have proven to be huge pipelines of capital into Bitcoin and that universe of ETFs continues to grow with the recent approvals in Hong Kong as well,” said Riot’s Les. “We think the price action we’ve seen in bitcoin year-to-date reflect that and has us very optimistic on what bitcoin mining economics can look like in the months and years post-halving.”

Bitcoin resumes rally after hitting a new all-time high

Blackrock’s ETF reached $17 billion in net assets within a few months of launching. Beard of Stronghold tells CNBC that if Blackrock added even just a billion dollars more of bitcoin in April to its ETF, it would single handedly create demand for more coins than the mining industry will supply post halving.

What is also different this time around is that the block reward is no longer the primary form of miner revenue. Recent programming innovations in bitcoin have given way to a burgeoning ecosystem of projects building on top of bitcoin’s blockchain, which has translated to greater transaction fee revenue for miners.

There is a limit to how large the blocks can go but the value of those blocks is about to increase significantly, according to Bill Barhydt, who is the CEO and founder of Abra. From Barhydt’s vantage point, he supports miners with a mix of services, including their auto liquidations, so he has access to a lot of macro data across the sector.

“The math is simple,” begins Barhydt. “Bitcoin blocks are fixed in size and the demand for data within those blocks is going to increase significantly for several reasons, including more retail wallet holders moving their Bitcoin into and out of storage, new uses cases like Ordinals (NFT’s for Bitcoin) and DeFi on Bitcoin, institutional settlement requirements for exchange traded products in the U.S., Hong Kong, Europe, etc, lightning settlement transactions and more.”

At the current rate of adoption, Barhydt believes that transaction fees in this cycle would likely peak within 24 months at 10 times their cost during the previous cycle peak, due to a combination of a higher price for bitcoin itself, combined with higher demand for the space inside each block. 

Castle Island’s Carter isn’t so sure that fee-based revenue can completely make up for lost income post-halving.

“It’s not entirely clear that fees are fully offsetting the lost revenue, and in fact, I don’t expect that to happen” said Carter.

Fees tend to be really cyclical. They rise sharply during periods of congestion, and they fall back to near zero during other normal periods. Carter cautions that miners will see spikes in fees, but there is not yet an enduring, strong, and robust fee market most of the time.

Jack Dorsey backed start-up taps into geothermal, hydro and solar power to run bitcoin mines across Africa

Swapping ASICs for AI

In the last year, there has been a surge in demand for AI compute and infrastructure that can support the massive workloads required to power these novel machine learning applications. In a new report, digital asset fund manager CoinShares says it expects to see more miners shift toward artificial intelligence in energy-secure locations because of the potential for higher revenues.

Already, mining firms like BitDigital, Hive, Hut 8, Terawfulf, and Core Scientific all have current AI operations or AI growth plans.

“This trend suggests that bitcoin mining may increasingly move to stranded energy sites while investment in AI grows at more stable locations,” write analysts CoinShares.

But pivoting from bitcoin mining to AI isn’t as simple as re-purposing existing infrastructure and machines. The datacenter infrastructure is different, as are the data network needs.

“AI presents several challenges, notably the need for distinct and considerably more costly infrastructure, which establishes barriers to entry for smaller, less capitalized entities,” continues the report. “Additionally, the necessity for a different skill set among employees leads to increased costs as companies hire more AI-skilled talent.”

The rigs used to mine bitcoin are called ASICs, short for Application-Specific Integrated Circuits. The “Specific” in that acronym means that it can’t be used to do other things, like supporting the underlying infrastructure for AI market.

“If you’re a bitcoin miner, your machines can’t be repurposed,” explains Carter. “You have to buy net new machines in order to do it and the datacenter requirements are different for AI versus bitcoin mining.”

Sullivan says that Core Scientific, which has been mining a mix of digital assets since 2017, began to diversify into other services in 2019.

“The company has owned and hosted Nvidia DGX systems andGPUs for AI computing, having built and deployed a specialized facility specifically for high-value compute applications at our Dalton, Georgia data center campus,” he said.

Core has also partnered with CoreWeave, a cloud provider which provides infrastructure for use cases like machine learning.

Sullivan says the combined capabilities will support both AI and High Performance Compute workloads, resulting in an estimated revenue of $100 million, though he says the total potential revenue is much higher given their significant infrastructure footprint that can be fitted to host some of the most advanced GPU compute coming to market.

“Bitcoin mining is an early example of high-value compute, attracting significant capital and a number of companies scaling their operations to support the Bitcoin Network,” said Sullivan.

But Sullivan thinks few operators will be able to make the transition to AI.

Sullivan continued, “Bitcoin mining sites can only be repurposed if they meet the attributes that are required for HPC. Many existing sites across North America do not meet these needs.”

Spot bitcoin ETF decision: First trades expected after SEC grants multiple approvals

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Firstgreen remote operated electric skid steer hopes to reduce mining deaths

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Firstgreen remote operated electric skid steer hopes to reduce mining deaths

Mining fatalities climbed more than 30 percent from 2022 to 2023, with construction fatalities also continuing to rise. In a bid to help keep miners safe, FIRSTGREEN Industries has launched a new line of cabinless, remote operated skid steers designed specifically for use in critical mining operations.

We covered the copmany’s first cabinless electric loader, the Elise CBL, back in January. The CBL (for “Clean Building Logistics”) is designed to enable fully remote operation, reducing the risk of operator injury or exposure to hazardous materials like asbestos and radiation in high-risk demolition environments. And, because it’s electric, it can do so without adding diesel exhaust emissions (themselves a known carcinogen) to the list of hazards faced by its operators. Now, FIRSTGREEN is offering that same functionality to underground miners with the new ROCKEAT equipment line.

“We are thrilled to introduce ROCKEAT skid steers to the US market, which represents a significant leap forward in safety and sustainability for traditionally dangerous, high-emission industries like construction and mining,” Marcus Suess, COO of FIRSTGREEN Industries, told Construction Equipment Guide. “With continued national support to accelerate the expansion of critical mineral mining projects on home soil … addresses pressing environmental concerns but also contributes to the resurgence of homegrown industry.”

Available in big and bigger

Designed with a low clearance, 360-degree camera and remote operability, ROCKEAT machines redefine safety and efficiency in critical mining, construction and other hazardous industries; via FIRSTGREEN Industries.

The ROCKEAT comes in two models. Designated 700 and 1200, the two models are 67 in. and 71 in. wide, respectively, and available with either lead-acid or lithium-ion batteries. Max power output is 3 36.2 hp motors generating a maximum torque of 3 x 89 lb-ft of torque, with load capacities of 1,500 and 3,300 lbs., respectively. Charging is accomplished using standard 110v or 220v outlets, or by swapping batteries on the fly.

In both cases, the key feature is remote operation. The ROCKEAT machines can be operated via the standard, Danfoss-developed remote cabin, or the FIRSTGREEN mobile app for a quick backup solution, regardless of whether that’s a “I just need to back it up a few feet,” or, “Oh my God! It’s killing Kenny!” scenario.

Electrek’s Take

FIRSTGREEN quotes the US Bureau of Labor Statistics report saying that, of the 484 workplace fatalities reported in 2022, some 75 percent involved heavy equipment operators. By reducing the amount of noise in a mine with electrified equipment, and putting the operators far enough away to keep them out of harm’s way, the ROCKEAT may just be able to do what its makers say: keep workers a little bit safer.

To that end, FIRSTGREEN’s efforts to beef up the Elise and move into the mining space should be of great interest to companies like Caterpillar and Liebherr, who are also working to electrify their mining equipment offerings. Whether or not the upstart equipment brand will be able to establish a beachhead with its cabinless, remote-operated machinery and clever, practical, battery-swap technology remains to be seen.

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We added to 5 portfolio stocks in last week’s oversold market. Here’s the breakdown

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We added to 5 portfolio stocks in last week's oversold market. Here's the breakdown

Traders work on the floor of the New York Stock Exchange on April 1, 2024.

Brendan Mcdermid | Reuters

It was a tough, choppy week for stocks, but the oversold market gave us many opportunities to put some of our cash to work selectively.

The Club added to five of our positions.

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