Bitcoin Record, Apple Shares Slide | Bloomberg Technology
ANNOUNCER: FROM THE HEART OF WHERE INNOVATION AND MONEY COLLIDE, THIS IS "BLOOMBERG TECHNOLOGY." WITH CAROLINE HYDE AND ED LUDLOW. CAROLINE: I'M CAROLINE HYDE AT BLOOMBERG'S HEADQUARTERS IN NEW YORK. ED: I'M ED LUDLOW IN SAN FRANCISCO. THIS IS "BLOOMBERG TECHNOLOGY." CAROLINE: APPLE SHARES SLIDE AS THE IPHONE MAKER SEES A BIG DROP IN CHINA SALES, WITH THE IN CORRECTION. WE WILL BREAK DOWN EVERYTHING YOU NEED TO KNOW. ED:
WE STAY WITH CHINA AS AMD FACES A U.S. ROADBLOCK IN SELLING ITS ARTIFICIAL INTELLIGENCE CHIPS IN THE CHINESE MARKET. BLOOMBERG EXCLUSIVE AHEAD. CAROLINE: BITCOIN HITS A FRESH RECORD SINCE ITS PEAK IN NOVEMBER 2021. WE WILL HAVE COVERAGE OF THE MARKET AND THOSE MEME COINS IN THE RUSH. LET'S FIRST CHECK IN ON THESE
MARKETS. BITCOIN IS UP, BUT THE REST OF THE MARKET TRYING TO DIGEST SOME OF THE RUN-UP WE HAVE SEEN. WE FOCUS IN ON MIXED ECONOMIC DATA TODAY. THE U.S.
SHOWING SOME SERVICES WEAKNESS AND WE LOOK AHEAD TO TESTIMONY FROM JAY POWELL, HIS SEMIANNUAL EXPERIENCE IN TERMS OF THE POLITICIANS. WHAT WILL THE GRILLING MEAN? HOW MUCH WILL HE BE RETICENT TO SAY THAT THEY ARE LOOKING AT THOSE RATE CUTS ANYTIME SOON? WE ARE LOOKING AT 1.8% DOWN. I WANT TO FOCUS ON WHAT IS HAPPENING IN CHINA, THE TRADENAMES IN THE UNITED STATES WITH A GOLDEN DRAGON INDEX, OFF BY 1% AS WE SEE A GROWTH PERSPECTIVE COMING FROM CHINA. HOW WILL THEY GET THERE? THAT ULTIMATELY WHAT IS THE DEBT THEY ARE GOING TO BE FUELING IN TERMS OF THE FOCUS ON A I, ON TECHNOLOGY COMING FROM CHINA? NOT ENOUGH TO BUOY THE STOCKS AND CHINESE NAMES. LOOKING AT THE 10-YEAR YIELD, OFF BY SEVEN BASIS POINTS AS WE ANTICIPATE JAY POWELL'S SPEECH. A LOOK AT WHAT IS HAPPENING IN THE ASSET CLASS WE NEED TO TALK ABOUT TODAY.
THIS HAPPENED JUST AFTER 9:00 A.M., BUT WE ARE LOOKING AT A 66 BACK TO IT AT THE MOMENT. WE HAD THAT PSYCHOLOGICAL LEVEL. ALREADY WE HAVE SEEN THE MARKET CAPITALIZATION ECLIPSED THAT OF 2021 BECAUSE THERE IS MORE BIG GOING IN -- MORE BITCOIN IN SUPPLY. WE ARE CURRENTLY UP 9.9% THE COURSE OF WHAT HAS BEEN A MEGA RUN THROUGHOUT 2024. 2023, LOWER, IN THE DOLDRUMS. BUT WE ARE BACK AT THAT LEVEL WE HAD IN NOVEMBER 2021. ED, WHAT ARE YOU WATCHING?
CAROLINE: THERE IS A LOT -- ED: THERE IS A LOT IN THE NEWS FLOW HITTING TECHNOLOGY SHARES. TESLA, A FIRE NEAR ITS BERLIN PLANT HAS HALTED PRODUCTION. INVESTIGATORS ARE INVESTIGATING WHETHER ARSON WAS THE CAUSE.
DATA ON CHINA IS A SOFTER, SHOWING THAT SALES OF TESLA NOT AS STRONG. THAT STOCK UNDER PRESSURE. TWO OTHER STORIES. WE ARE GOING TO HEAD TO D.C.. BLOOMBERG REPORTING THAT U.S. OFFICIALS ARE GOING TO BLOCK AMD SELLING A MADE FOR CHINA LOWER-SPEC GPU. IT IS SOMETHING SIMILAR TO WHAT NVIDIA DID, AND THAT SEEMS TO BE WEIGHING ON SHARES TOO. IN LINE WITH THE BROADER MARKET. YOU HAVE APPLE DOWN 2.8 PERCENT, TRADING AT ITS LOWEST
LEVEL SINCE OCTOBER. WE HAD DATA FROM COUNTERPART -- COUNTERPOINT RESEARCH. IN THE FIRST SIX WEEKS OF 2024 SALES OF THE IPHONE IN CHINA FELL YOU'RE ON YOUR COMPARED TO THAT SAME SIX-WEEK PERIOD YEAR AGO. I WANT TO BRING IN MARK GURMAN.
THE DATA ALSO SHOWS OTHER HANDSET MAKERS HAD A SURGE IN SALES. THEREFORE, THE MARKET SHARE PICTURE IN CHINA IS CHANGING, WITH APPLE DROPPING BELOW 60%, AND HUAWEI BACK ABOUT 16%. WHAT IS GOING ON? MARK: THIS IS HUGELY SIGNIFICANT. WE HAVE KNOWN FOR A COUPLE
QUARTERS NOW THAT APPLE HAS BEEN RUNNING INTO ROADBLOCKS IN CHINA BUT -- CHINA. CERTAINLY THAT NEW HUAWEI PHONE HAS BEEN POPULAR. THAT NEW DEVICE WITH THE LOCALLY-DESIGN PROCESSOR. WE HAVE KNOWN FOR A WHILE THERE
IS THIS SENSE OF RENEWED NATIONALISM IN CHINA, WHERE PEOPLE ARE MAY PUTTING UP PURCHASES A LITTLE BIT ON THE BACK BURNER AND FOCUSING ON PURCHASES FROM STATESIDE COMPANIES. THERE HAS BEEN SOME BANDS IN SOME ORGANIZATIONS OWNED BY GOVERNMENTS, GOVERNMENT ENTITIES, WHERE THEY DON'T WANT AMERICAN-MADE DEVICES. THEY DON'T WANT KOREAN-MAY DEVICES LIKE SAMSUNG. WHAT IS INTERESTING ABOUT THE FIRST SIX WEEKS NUMBER IS IT IS ACTUALLY A LITTLE WORSE THAN IT SEEMS ON THE SURFACE. LET'S DO A COMPARISON. WHAT HAPPENED LAST YEAR? THE IPHONE -- I-4 14 -- IPHONE 14 CAME OUT. THAT WAS NOT AS MUCH OF AN UPGRADE WITH THE IPHONE PRO.
YOU WOULD THINK A NEW DESIGN WOULD SELL BETTER, BUT WE ALSO REMEMBER THERE WERE NO SUPPLY ISSUES THIS YEAR. LAST YEAR THERE WERE SIGNIFICANT SUPPLY CHAIN ISSUES. THERE WAS A LOT OF PENT-UP DEMAND IN THE FIRST SIX WEEKS OF 2023. NOT ONLY IS APPLE DOWN, THEY ARE DOWN IN COMPARISON TO A PHONE THAT WAS NOT IT AS BIG OF AN UPGRADE AND THEY ARE DOWN WHEN THERE WAS SO MUCH PENT-UP DEMAND FOR THIS DEVICE.
SO, CLEARLY NOT A TERRIFIC SITUATION HERE, BUT I DO SEE SOME MEN SOME SHIFTING THE IPHONE 16 PRO IS GOING TO LAUNCH LATER THIS YEAR. THERE ARE SOME COOL NEW CAMERA FEATURES THAT COULD EXCITE THAT MARKET. THE OTHER THING TO NOTE IS THAT THE APPLE VISION PRO MIXED REALITY, THAT IS A PRETTY POPULAR TECHNOLOGY IN CHINA AND ASIA IN GENERAL. I EXPECT CHINA TO BE ONE OF THE FIRST MARKETS TO GET THAT HEADSET. IT IS NOT ALL BAD FOR APPLE IN CHINA. THERE IS GOING TO BE A SHIFT LATER IN THE YEAR. CAROLINE:
THIS DATA COMING FROM COUNTERPOINT, IT IS NOT -- IT IS THEIR NARRATIVE, NOT APPLE'S. WHAT ARE WE HEARING FROM APPLE TO REGAIN THEIR? PUSHED OUT A STORY YESTERDAY ABOUT HOW THEY HAVE BEEN UPDATING THEIR MACBOOK, BRINGING IN FASTER CHIPS. WE NEED TO HEAR MORE ABOUT ARTIFICIAL INTELLIGENCE AS WELL. YOUR SCOOP LAST WEEK ABOUT THE FACT THEY ARE PULLING BACK ON THE CAR, PUTTING THEIR TECHNOLOGY EXPERTS TO WORK IN GENERATIVE AI, DOES THAT MEAN WE COULD START TO SEE A REFRESH AND RE-EXUBERANCE AROUND PURCHASING? MARK: THE BIG QUESTION IS IF A LOT OF THESE NEW AI FEATURES ARE GOING TO BE AVAILABLE GLOBALLY, RIGHT? IT COULD BE SENSIBLE THAT APPLE FIRST ROLLS THEM OUT IN ENGLISH-SPEAKING COUNTRIES, RIGHT? AND THEN THEY HAVE A LONG ROAD MAP AHEAD TO EXPAND THE FEATURES TO CHINA AND SOME OF THE INTERNATIONAL REGIONS. I'M NOT SURE THAT AI IS GOING TO GIVE A SIGNIFICANT BOOST TO THEIR PRODUCT SALES.
I THINK AI WOULD BE BETTER -- WOULD BE BETTER SERVED IN TERMS OF REVENUE FOR YOUR PRODUCT. WHAT TYPES OF ADVICES CAN YOU ENABLE? THINGS LIKE MORE ADVANCED HEADSETS, AUGMENTED REALITY GLASSES, TABLETOP ROBOTICS DEVICES, AND BEFORE IT WAS CANCELED, THE CAR, OF COURSE. THAT IS SOMETHING TO WATCH. APPLE IS NOT SAYING MUCH. WHEN THEY LAST SPOKE THEY SEEMED PRETTY EXCITED ABOUT WHAT WAS GOING ON IN CHINA. THEY WERE REFERENCING COUNTERPOINT'S PREVIOUS REPORT THAT INDICATED THE IPHONE IS DOING EXTREME THE WELL AND EVERYONE WHO TALK NEGATIVELY ABOUT APPLE IN CHINA WAS WRONG. THIS IS A COMPLETE NARRATIVE
SHIFT. THE FIRST THING YOU SAID WAS IMPORTANT. DISK IS COUNTERPOINT'S NUMBERS. SOMETIMES THESE NUMBERS ARE CORRECT.
SOMETIMES THEY ARE COMPLETELY INCORRECT. I WOULD SAY ON AVERAGE THEY GIVE A FAIR IDEA OF WHAT IS GOING ON. SO, IT IS POSSIBLE THE REAL SITUATION IS NOT AS BAD AS COUNTERPOINT IS INDICATING TODAY, BUT CERTAINLY THERE IS SOME INDICATOR FROM THEM, AT LEAST THAT THINGS ARE NOT AS GREAT AS ONE WOULD HOPE IF YOU ARE AN APPLE SHAREHOLDER. CAROLINE: CERTAINLY HAS TAKEN A BIG HEAD TO MARKET CAPITALIZATION THE SHIP. MARK GURMAN, SO FANTASTIC TO RUN THROUGH ALL OF APPLE WITH YOU. LET'S STAY WITH CHINA. U.S. OFFICIALS HAVE TOLD AMD ITS ARTIFICIAL INTELLIGENCE CHIP DESIGN FOR THE CHINESE MARKET IS TOO POWERFUL.
THEY CANNOT SELL IT WITHOUT A LICENSE FROM THE COMMERCE DEPARTMENT. FOR MORE IT IS MCKENZIE HAWKINS. WHAT IS INTERESTING IS, AMD HAD NOT BEEN DISCUSSING WHAT THEY HAVE BEEN MAKING FOR CHINA, BUT YOU GOT THE INSIDE TRACK. MCKINSEY: HAVE SEEN THIS STORY PLAY OUT BEFORE WITH NVIDIA, WHICH PUBLICLY SAID WE ARE TRYING TO DESIGN AN AI PROCESSOR FOR THE CHINESE MARKET TO ALIGN WITH U.S. EXPORT CONTROLS AFTER THOSE CURBS WERE PUT IN PLACE IN 2022.
THEN THE U.S. MOVED TO TIGHTEN THOSE RESTRICTIONS ABOUT A YEAR LATER. THAT CAPTURED NVIDIA'S CHIP. THE U.S. SAID YOU CANNOT SELL THAT TO CHINESE CUSTOMERS. SINCE THEN WE HAVE SEEN NVIDIA RELEASE NEW PROCESSORS FOR CHINA THAT THEY SAY ALIGN WITH THE STRICTER RESTRICTIONS, AND ALSO AMD TRYING TO GET INTO THIS MARKET AS WELL. AMD DEBUTED A NEW SUITE OF AI CHIPS IN DECEMBER, AND THIS CHINA-SPECIFIC CHIP IS A LESS POWERFUL VERSION OF THAT BROADER LINEUP OF PRODUCTS. ED: RIGHT.
THE IMPORTANT THING IS THERE ARE TWO POTENTIAL LINES OF RULES AMD HAS TO FOLLOW. THERE IS A TECHNOLOGICAL RESTRICTION, A BLANKET RULE THAT SAYS YOU CANNOT OFFER ANYTHING IN CHINA OF THIS SPEC, AND THEN THERE IS THE END-USER-SPECIFIC, WHICH SAYS YOU CANNOT SELL TO THIS COMPANY. DO WE KNOW WHICH ONE AMD IS CAUGHT BY? MCKENZIE: IT IS NOT CLEAR WHICH CHINESE CUSTOMER WAS TRYING TO BUY AMD CHIPS. THE PROCESS THEY WENT THROUGH IS, THERE IS A SET OF CHIPS THAT ARE DEEMED TOO POWERFUL.
NO MATTER WHAT IF YOU HAVE CHIPS OF THOSE SPECS YOU NEED TO APPLY FOR A U.S. GOVERNMENT LICENSE. THEN THERE IS A LOWER TIER FOR WHAT YOU HAVE TO NOTIFY THE U.S. GOVERNMENT OF YOUR INTENT TO SELL THOSE CHIPS TO A CHINESE CUSTOMER AND THEY LET YOU KNOW WHETHER YOU NEED A LICENSE. THAT IS WHAT HAPPENED TO AMD. THEY DESIGNED A CHIP THAT FELL BELOW THE HIGHEST THRESHOLD, THE MOST STRICT CUT OFF, AND THEN THE U.S. SAID, ACTUALLY YOU ARE NOT ALLOWED TO GET AN EXEMPTION FROM THE OVERALL LICENSING REGIME AND YOU ARE GOING TO HAVE TO GO THROUGH THIS PROCESS.
NOW IT REMAINS TO BE SEEN WHETHER AMD IS ACTUALLY TRYING TO DO THAT OR WHETHER THEY WILL PIVOT AWAY FROM THE STRATEGY. ED: AMD, DOWN ONE -- DOWN 1.8%, BUT THE OTHER CHIP NAMES TOO. TERRIFIC REPORTING.
CHINA' IS PLEDGED TO HORNER THE NATION'S RESOURCES TO SPEED HOMEGROWN SCIENTIFIC BREAKTHROUGHS. WE ARE PRIORITY TO BECOME SELF-RELIANT IN SPHERES FROM AI TO CHIPMAKING TO TECHNOLOGICAL SUPREMACY FROM THE U.S.. AT DAY ONE OF THE NATIONAL PEOPLE'S CONGRESS THE PREMIER LAID OUT THE NATION'S PRIORITIES, WHICH ARE STILL TECHNOLOGICAL INNOVATION AND UPGRADING ITS INDUSTRIES, INCLUDING NEW ENERGY VEHICLES. CAROLINE: LET'S GO OVER TO WHAT IS HAPPENING IN THE WORLD OF POLITICS. IT AFFECTS THE WORLD OF TECHNOLOGY. WE ARE GOING TO BE DISCUSSING AI MISINFORMATION AND WHAT LOCAL ELECTION OFFICES CAN BE DOING TO PREPARE FOR THAT. THE CONVERSATION COMING UP NEXT.
MEANWHILE CHECK OUT WHAT IS HAPPENING WITH META SHARES. THE REST OF TECHNOLOGY IS OFF IN SYMPATHY, BUT MORE BROADLY WE ARE LOOKING AT REPORTS THAT SHOWS META SERVICES ARE HAVING ISSUES. DOWN DETECTIVE REPORTING PLENTY OF ISSUES, ACROSS INSTAGRAM, FACEBOOK, AND MESSENGER.
IRONICALLY, ON X IS WHERE WE HEARD FROM ANDY STONE, SAYING THEY ARE AWARE AND WORKING ON A FIX. THIS IS "BLOOMBERG TECHNOLOGY." CAROLINE: NOW LET'S GET INTO THE LATEST FROM TODAY'S SUPER TUESDAY PRIMARIES. KAILEY LEINZ HAS BEEN VERY BUSY IN ANTICIPATION OF THIS DAY AND THROUGHOUT IT. WHAT ARE WE BRACING FOR? KAILEY:
WE ARE BRACING FOR WHAT EFFECTIVELY COULD BE THE START OF THE GENERAL ELECTION TONIGHT, BECAUSE THE FRONTRUNNER IN THE PUBLIC AND PRIMARY COULD SWEEP ALL 15 OF THESE STATES, WHICH WOULD GET HIM NOT EXACTLY AT BUT VERY CLOSE TO THE 1215 DELEGATES HE NEEDS. NIKKI HALEY IS STILL IN THE RACE. SHE HAS COMMITTED TO STAYING IN THROUGH THE CONTEST TODAY BUT IT IS UNCLEAR IF HER CAMPAIGN WILL LAST BEYOND TODAY SHOULD SHE NOT COME OUT AS THE VICTOR IN ANY OF THESE STATES. STATES TO WATCH OUT FOR COULD BE VERMONT, MAY BE VIRGINIA. IF SHE COULD WIN THOSE STATES IT IS UNLIKELY SHE WOULD BE VICTORIOUS IN ANY OTHERS. HALEY DOES HAVE FINANCING, THEORETICALLY, AS SHE PULLS IN MILLIONS OF DOLLARS FROM DONORS. HER CAMPAIGN SAYS ANOTHER $1
MILLION IN MARCH. MATHEMATICALLY IT MIGHT NOT BE POSSIBLE FOR HER TO SECURE THE NOMINATION AFTER TONIGHT, WHICH MEANS WE COULD BE LOOKING DOWN THE REMATCH TROUBLE -- REMATCH TUNNEL. ED: I'M LOOKING FORWARD TO JOINING YOU AND JOE MATHIEU THIS EVENING WITH OUR SPECIAL SHOW AND COVERAGE. WHEN YOU LOOK AT CALIFORNIA TRUMP AND BIDEN BASICALLY SAY, I WANT TO GET IT DONE. EVEN THOUGH IT IS THE MOST POPULAR STATE. IT IS PROBABLY MORE INTERESTING IS SOME OF THE DOLLARS THAT ORIGINATE FROM THE STATE AND SOME OF THE INITIATIVES THEY ARE BACKING. KAILEY: ABSOLUTELY.
IN THE DOWN BALLOT RACES SPECIFICALLY. IF YOU LOOK AT THE SENATE PRIMARY TO REPLACE DAN FEINSTEIN -- DIANNE FEINSTEIN, HAVE THREE MEMBERS OF THE HOUSE WHO ARE COMPETING AGAINST ONE REPUBLICAN , STEVE GARVEY, YOU MAY KNOW AS A FORMER LOS ANGELES DODGERS PLAYER. CALIFORNIA HAS A JUNGLE PRIMARY, WHICH MEANS WHOEVER TWO GET THE HIGHEST VOTES, THEY'RE THE ONES THAT WILL ADVANCE TO THE GENERAL ELECTION IN NOVEMBER. CRYPTO PACKS SPECIFICALLY HAVE BEEN THROWING A LOT OF MONEY AT THIS RACE, SPECIFICALLY THROWING MONEY AGAINST KATIE PORTER, SPINNING ABOUT $10 MILLION AGAINST HER, WHICH HAS HELPED ADAM SCHIFF, WHO DOES HAVE SOME MORE CRYPTO-FRIENDLY LANGUAGE ON HIS CAMPAIGN WEBSITE. THAT IS ONE OF THE RACES TO WATCH.
WHEN YOU ARE THINKING CRYPTO, THEY ARE SPENDING MONEY AND OTHER STATES AS WELL, LIKE ALABAMA AND NORTH CAROLINA. CERTAINLY THE INDUSTRY IS TRYING TO ADVANCE ITS OBJECTIVES THROUGH DOLLARS THIS EVENING. ED: KAILEY LEINZ, I WILL SEE YOU FOR HOURS SUPER TUESDAY COVERAGE. THANK YOU VERY MUCH. LET'S KEEP THE CONVERSATION GOING. THERE IS SOMETHING TO DISCUSS
AROUND THE INTERSECTION OF ARTIFICIAL INTELLIGENCE AND MISINFORMATION IN THIS ELECTION CYCLE. HERE IS WHAT SOME OF OUR RECENT GUESTS ON BLOOMBERG TV HAVE HAD TO SAY ABOUT THAT. >> MISINFORMATION WITH ARTIFICIAL INTELLIGENCE.
THEY COULD BE ANOTHER FACTOR THAT IMPACTS WHAT IS GOING ON AROUND THE ELECTION. >> I DON'T THINK INDEPENDENCE, REPUBLICANS, OR DEMOCRATS HAVE ANY IDEA ABOUT HOW EFFECTIVE AI CAN BE IF IT IS IN THE HANDS OF SPECIFIC INDIVIDUALS THAT HAVE NO MORAL BOUNDARIES. >> IF SOMEBODY DOES THAT DEEPFAKE, WHETHER IT IS JOE BIDEN AND TRUMP, WE ARE GOING TO BE ABLE TO FIND OUT. >> WHAT WE ARE SEEING ALSO IS THE DISINFORMATION CAMPAIGNS CAN BE EFFECTIVE WITH AI.
>> THERE IS MUCH MORE SUBTLE MANIPULATION I THINK WE NEED TO WATCH FOR. ED: LET'S BRING IN MARCI ANDINO. SHE IS THE SENIOR DIRECTOR OF THE ALEXION INFRASTRUCTURE INFORMATION SHARING AND ANALYSIS CENTER -- ELECTION INFRASTRUCTURE INFORMATION SHARING AND ANALYSIS CENTER. IT IS SUPER TUESDAY. SOCIAL MEDIA IS DOWN. WHAT DO YOU THINK WILL HAPPEN TONIGHT IN THE CONTEXT OF AI AND MISINFORMATION? MARCI: THANK YOU SO MUCH FOR THAT QUESTION. IS -- IT IS A PLEASURE TO BE WITH YOU.
AI IS A NEW TOPIC WE ARE TALKING ABOUT. YOU'RE TALKING AND TRACKING FIVE CYBERSECURITY THREATS AS WE MOVE INTO THE GENERAL ELECTION AND AI IS THE NEW KID ON THE BLOCK, IF YOU WILL. WE ARE NOT SEEING A LOT OF AI ACTIVITY RIGHT NOW, BUT IT CERTAINLY HAS THE POTENTIAL TO INCREASE MISINFORMATION CAMPAIGNS.
IT WILL AMPLIFY OR MAGNIFY THE RISK THAT ALREADY EXISTS OUT THERE. CAROLINE: WHAT YOUR ROLE DOES IS, YOU ARE OFFERING TOOLS, TRAINING TO THOSE OUT THERE IN THE FIELD, TRYING TO ENSURE THIS IS NOT SPREADING IN THEIR ELECTIONS ARE BEING RUN FAIRLY. YOU ARE PROVIDING EFFECTIVE REMEDIATION IF THERE ARE INCIDENTS. TALK US THROUGH WHAT YOU'RE GO TO IS IN RESPONSE TO ANY SORT OF SUDDEN SWEEPING OF A MISINFORMATION OUTBREAK THAT MIGHT OR MIGHT NOT OCCUR AS PEOPLE HAD TO THE POLLS. MARCI:
WE HAVE BEEN TALKING WITH ELECTION OFFICIALS OVER THE LAST YEAR ABOUT THE POSSIBILITY OF SEEING GENERATIVE AI USED TO DISRUPT ELECTIONS. WE ARE REMINDING ELECTION OFFICIALS THAT THEY NEED TO COLLABORATE WITH US AND SHARE INFORMATION SO WE CAN PASS THAT INFORMATION ON TO OTHER ELECTION OFFICIALS SO THEY MIGHT KNOW WHAT IS COMING IN THEIR STATES. THE MOST POWERFUL THING THEY CAN DO IS EDUCATE VOTERS, CITIZENS, CANDIDATES, AND EVEN THEIR LOCAL MEDIA SO WHEN PEOPLE SEE SOMETHING THAT THEY THINK MIGHT NOT BE EXACTLY RIGHT, THEY KNOW WHERE TO GO TO GET ACCURATE INFORMATION. AND THAT IS WITH THE STATE OR LOCAL ELECTION OFFICIALS. SO, IT IS VERY IMPORTANT THAT THEY ESTABLISH THEMSELVES AS THE TRUSTED SOURCE OF INFORMATION.
AND THAT EVEN GOES FOR TRAINING THEIR STAFF. STAFF AND ELECTION OFFICES WORK LONG HOURS. THEY GET VERY TIRED, SO THEY ARE MORE APT TO CLICK ON SOMETHING, AND THEY BRING IN A LOT OF SEASONAL WORKERS, SO THOSE SEASONAL WORKERS MAY OR MAY NOT HAVE HAD ANY TRAINING, SO IT IS IMPORTANT TO MAKE SURE THEY ARE TRAINED AND READY TO GO AS WELL. AND, OF COURSE, USING GOOD CYBER HYGIENE, PASSWORDS, STRONG PASSWORDS. TURNING ON MULTIFACTOR
AUTHENTICATION ON EVERY APPLICATION THEY CAN. AND USING OUR NO-COST TOOLS TO PROTECT THEIR NETWORK, THEIR CRITICAL NETWORKS. ED: I THINK CYBER HYGIENE IS A NEW ONE FOR US ON THE SHOW. IS THERE ANY PROOF WE ARE BETTER PREPARED FOR THIS YEAR'S ELECTION THEN WE WERE IN 2020? MARCI: WELL, THE EI-ISAC, WE HAVE BEEN WORKING WITH ELECTION OFFICIALS ACROSS THE COUNTRY AND IN THE TERRITORIES TO RAISE THEIR CYBERSECURITY POSTURE. WE HAVE DEPLOYED LOTS OF SOLUTIONS, CYBERSECURITY SOLUTIONS THAT WOULD HARDEN THEIR DEFENSES, AND WE HAVE ALSO PROVIDED A LOT OF TRAINING. WE ARE TALKING TO ELECTION OFFICIALS IN TERMS THEY UNDERSTAND.
FORMER ELECTION OFFICIALS IN MANY CASES. WE ARE BREAKING THE -- BREAKING DEMOS AREAS AND UNDERSTANDING THAT CYBERSECURITY IS EVERYBODY'S RESPONSIBILITY AND THEY NEED TO TAKE ACTION. I BELIEVE WE ARE BETTER PREPARED, BUT CYBERSECURITY IS A LONG-TERM GAME. IT IS NOT A ONE AND DONE. IT IS CONSTANTLY CHANGING, AND AS YOU STARTED THE CONVERSATION WITH GENERATIVE AI, THAT IS THE NEW THING THAT WE ARE TRYING TO BUILD DEFENSES AROUND AND PREPARE ELECTIONS TO DEAL WITH -- ELECTION OFFICIALS TO DEAL WITH, ESPECIALLY AS WE MOVE INTO THE GENERAL ELECTION. CAROLINE:
GREAT TO HAVE SOME TIME WITH YOU AHEAD OF THE SUPER TUESDAY. MARCI ANDINO, SENIOR DIRECTOR FOR THE ALEXION INFRASTRUCTURE INFORMATION SHARING AND ANALYSIS CENTER. FOR THE FIRST TIME IN NINE MONTHS, ELON MUSK IS NO LONGER THE WORLD'S RICHEST PERSON. WE WILL HAVE MORE FOR YOU. THIS IS "BLOOMBERG TECHNOLOGY." CAROLINE: TIME NOW FOR TALKING TECH.
FIRST UP, ALIBABA SPEARHEADING ITS SECOND MAJOR DEAL IN AI THIS YEAR, EATING A FINANCING -- LEADING A FINANCING ROUND AS THE E-COMMERCE FIRM -- THE FIRM THAT IT BACKED IS A SECURED NOT ONLY FROM ALIBABA, BUT OTHER INVESTORS. THAT BRINGS ITS VALUATION TO $2.5 BILLION. EMAAR, FOUR -- MEANWHILE, FOUR X-TESLA EXECUTIVES HAVE SUED ELON MUSK -- EX-TWITTER EXECUTIVES HAVE SUED ELON MUSK.
PUBLICLY VOWING TO WITHHOLD THEIR SEVERANCE TO RECOUP $200 MILLION FROM THE $44 BILLION DEAL ACCORDING TO THE LAWSUIT. LET'S TALK ABOUT ELON MUSK MORE. HE HAS BEEN DETHRONED BY JEFF BEZOS AS THE WORLD'S RICHEST PERSON.
THE TESLA FOUNDER LOST HIS POSITION TO THE AMAZON FOUNDER AFTER SHARES AND TESLA HAVE BEEN UNDER PRESSURE. THIS IS BEZOS'S FIRST RETURN TO THE TOP OF THE INDEX SINCE 2021. THIS IS, OF COURSE, WE HAVE SEEN SIGNIFICANT ISSUES WITH TESLA IN CHINA, FOR EXAMPLE. ED: ELON MUSK HAS LOST $33 BILLION
OF WEALTH THIS YEAR. BEZOS GAINED $23.4 BILLION. WHAT IS A FEW BILLION DOLLARS AMONG FRIENDS? CAROLINE: ARE THEY FRIENDS? ED: NO THEY'RE NOT, NO. [LAUGHTER] CAROLINE: COMING UP, LET'S RETURN TO THE STATE OF CYBERSECURITY. CAROLINE: WELCOME BACK TO "BLOOMBERG TECHNOLOGY." I'M CAROLINE HYDE IN NEW YORK. ED: AND I'M ED LUDLOW IN SAN FRANCISCO.
LET'S GET BACK TO BITCOIN. WE ARE NOW BELOW $66,000. EARLIER BITCOIN TOUCHED ITS FIRST RECORD HIGH SINCE NOVEMBER 2020 ONE, JUST ABOVE $69,000. SEE THAT ALL THE TIME IN DIFFERENT ASSET CLASSES. HAD A LIGHT -- HIT A RECORD, THERE IS ENTHUSIASM, AND HE QUICKLY FALLS AWAY. YOU CAN SEE OVER A FIVE-DAY BASIS THE MOMENTUM WE HAVE SEEN IN BITCOIN AND ITS MARKET CAP ALSO NOW GLOBALLY NEAR THAT IN $.5 TRILLION MARK.
THERE IS A LOT HAPPENING IN EQUITY MARKETS. YOUR RIGHT TO POINT OUT THAT IT IS JAY POWELL WEEK. WE WILL HEAR FROM HIM LATER IN THE PROGRAM.
IT IS TECH THAT IS DRAGGING DOWN THE INDICES. APPLE'S OBSESSION LOWS, BUT DOWN 2.7%. THAT THIRD-PARTY COUNTERPOINT RESEARCH DATA SHOWING WEAKNESS IN CHINA, CONTINUING TO UPDATE YOU ON META. WE ARE GETTING REPORTS THAT INSTAGRAM, THREADS, AND FACEBOOK ARE DOWN. THE COMPANY HAS RESPONDED THROUGH A PHASE -- A SPOKESPERSON TO SAY THEY ARE AWARE OF IT. ALSO EARNINGS CONTINUE.
OR AT THE TAIL AND, BUT CROWD STRIKE REPORTS AFTERMARKET AND THAT BRINGS CYBERSECURITY BACK INTO FOCUS. RIGHT NOW WE HAVE BEEN THINKING ABOUT CYBERSECURITY IN THE CONTEXT OF SUPER TUESDAY, THE ELECTION CYCLE. EVERYONE IS DOING A LOT TO COUNTER IT, BUT THE THREATS APPEAR TO BE GROWING. LET'S BRING IN SOMEBODY WE ARE EXCITED TO SPEAK TO. THE CEO OF CATO NETWORKS, SHLOMO KRAMER. A.K.A., THE GODFATHER OF
CYBERSECURITY. SOME PEOPLE HAVE CALLED YOU THAT. I WANT TO START WITH THE ELECTION AND SUPER TUESDAY. EARLIER IN THE PROGRAM WE ATTRIBUTED A RAMP UP IN ACTIVITY OR RISK TO GENERATIVE AI. DO YOU SEE THAT ACROSS YOUR DESK AT THE MOMENT? SHLOMO: GENERATIVE AI IS THE NEXT PHASE IN CYBERSECURITY. BOTH FROM AN INFLUENCING THE
OPINIONS, AS WELL AS INDUSTRIALIZING THE ATTACKS. SO, ABSOLUTELY. YOU NEED AI FOR PROTECTION. ED: WE WELCOME YOU TO SAN FRANCISCO. HOW MUCH OF THE CONVERSATION YOU ARE HAVING WHILE YOU ARE IN TOWN IS ABOUT THE ELECTION? DO YOUR CLIENTS HAVE OTHER CONCERNS? SHLOMO: IT IS MOSTLY AROUND CYBERSECURITY IN GENERAL, AND ELECTION IS THE BIG TRANSACTION THAT NEEDS TO BE PROTECTED. BUT I WOULD SAY THAT IF YOU LOOK AT THE NEW ECONOMY, THE NUMBER ONE RISK TO IT IS CYBERSECURITY. CAROLINE:
AND YET POST THIS EARNINGS SEASON, COMPANIES YOU WROTE THE FIRST CHECK INTO, PALO ALTO NETWORKS OR OTHER CYBERSECURITY NAMES, THEY ARE DOWN BECAUSE PEOPLE ARE NOT SPENDING AT THE PACE THE MARKET HAD ANTICIPATED IN THEIR CYBER DEFENSES. DO YOU WORRY ABOUT THAT? SHLOMO: ACTUALLY, WE IN CATO, MY COMPANY IS HERE TO SOLVE THIS. THE SECURITY INDUSTRY FOR 30 YEARS HAS FOCUSED ON THE WHAT AND CREATED A HUGE NUMBER OF PRODUCTS THAT ESSENTIALLY ARE NOT CONSUMABLE BY MOST ENTERPRISES, SO THE CYBERSECURITY MARKET IS BROKEN, AND THE NEED TO FIX IT IS BY FINDING NEW WAYS TO CONSUME IT. AND THE PLATFORM THAT CATO PROVIDES IS THE NEW HOW THAT WILL FIX IT. CAROLINE: LET'S TALK ABOUT THAT. SECURE ACCESS SERVICE EDGE. IT SEEMS TO BE THE NEW WAY IN
WHICH YOU THINK YOU SHOULD BE DELIVERING CYBERSECURITY ACROSS A PLATFORM WORKLOAD, UNLIKE, YOU SAY, THAT ONE OF YOUR BIGGEST COMPETITORS, WHICH IS PALO ALTO. HOW MUCH IS THAT RESONATING? HOW MUCH ARE YOU SEEING ENTERPRISES ADOPT, OR IS IT GOVERNMENTS? WHO ARE YOUR END CONSUMERS AT THE MOMENT? SHLOMO: I WOULD SAY THE PAIN OF POINT SOLUTIONS IS EVERYWHERE, BUT AT LEAST TO LARGE ENTERPRISES, THE GAP BETWEEN RESOURCES AND CHALLENGES IS THE MOST SEVERE. SO, THE NEED FOR SASE IS THE MOST ACUTE, AND RECEIVED THE MOST TRACTION IN THIS TYPE OF ORGANIZATION TODAY. BUT EVENTUALLY THE CONCEPT OF PLATFORMS AND CONSUMPTION THROUGH PLATFORMS IS GOING TO REPLACE THE ENTIRE CYBERSECURITY MARKET. ED: LET'S TALK ABOUT THE MARKET AND ITS PLAYERS. WE HAVE A LITTLE DAVID AND
GOLIATH STORY. YOU WROTE THE FIRST CHECK FOR PALO ALTO NETWORKS. NOW YOU HAVE CATO. IT IS A SMALLER PLAYER IF WE EXTRAPOLATE OUT, YOU'RE BASICALLY SAYING I DON'T THINK THE BIG GUYS HAVE DONE VERY WELL, I'M GOING TO TRY AGAIN TO DO SOMETHING A BIT DIFFERENT. SHLOMO: YOU ARE ABSOLUTELY RIGHT.
THERE WAS ALSO A FIRST-GENERATION CHECKPOINT WHERE I WAS THE COFOUNDER. AND PALO ALTO CAME & FIRED THROUGH CONVERGENCE AND PLATFORM A MARKET THAT WAS SOFTWARE-BASED, BUT USING AN APPLIANCE. GUESS WHAT? DIGITAL TRANSFORMATION CAME AND CREATED A VERY FLUID WAY OF DOING BUSINESS. WORK FROM ANYWHERE.
APPLICATIONS ARE ANYWHERE. IT WAS A NEED FOR A NEW TYPE OF PLATFORM, AND THAT IS ESSENTIALLY WHAT CATO PROVIDES. AND ALL OF THE APPLIANCE WINDOWS, ALL OF THE SECOND-GENERATION VENDORS ARE TRYING TO ADJUST AND ADAPT, BUT THEY BRING WITH THEM SO MUCH BAGGAGE THAT IT IS VERY DIFFICULT FOR THEM. ED: WE HAVE TALKED ABOUT WHERE, TECHNOLOGICALLY, THE THREATS ARE COMING FROM. WHAT THE CONCERNS OF YOUR INJURY ARE. GEOGRAPHICALLY WHERE ARE THE THREATS COMING FROM? WE ARE ZEROED IN ON A DOMESTIC SITUATION, BUT AS WE LEARNED, CHINA, RUSSIA ARE ACTIVE IN THIS SPACE. SHLOMO: ABSOLUTELY.
WE ARE TALKING ABOUT TIMES OF PEACE, WHEN YOU ARE SEEING THIS MASSIVE INTERNATIONAL CROSS-BORDER ATTACK HAPPENS, AND ORGANIZATIONS, ESPECIALLY OF THE MEDIA ENTERPRISES ARE SUFFERING. IMAGINE WHAT WILL HAPPEN IN TIMES OF WAR? YOU DON'T NEED TO IMAGINE MUCH. YOU GO TO UKRAINE IN 2017 AND YOU WOULD SEE THAT GAY PERCENT OF THEIR ECONOMY WAS DOWN BECAUSE OF THIS TYPE OF ATTACK. SO, REALLY FIXING THIS MASS-MARKET PROBLEM OF CYBERSECURITY IS CRITICAL AS A DEFENSE AGAINST THESE TIMES OF WAR. CAROLINE: AND IT IS NOTABLE, OF COURSE, WHICH OUR HEARTS GO OUT TO THE FACT THAT YOU ARE TRAVELING TO US FROM ISRAEL AT THE MOMENT. I KNOW THAT IS SOMETHING THAT AFFECTS YOUR BUSINESSES AS WELL. I'M INTERESTED IN YOUR BUSINESS
IN PARTICULAR. AT A TIME WHEN THE MARKET WAS HAVING REAL DIFFICULTIES, WE WERE THINKING IN THE DOLDRUMS OF 2023, BC HAD PULLED BACK, AND YOU WERE STILL ABLE TO RAISE FUNDS. YOU ARE STILL PUTTING IN 238 MILLION DOLLARS IN SEPTEMBER 2023. LIGHTSPEED VENTURES THERE, ONCE AGAIN.
YOU HAVE TALKED ABOUT WANTING TO GO PUBLIC. AT THE MOMENT ARE YOU THINKING THAT WILL BE A 2024 ENDEAVOR? HOW ARE YOU ASSESSING THE AMERICAN MARKETS, AS WELL AS THE AMERICAN CYBERSECURITY MARKETS YOU SELL INTO? SHLOMO: CATO IS THE LEADER IN THIS NEXT GENERATION SASE MARKET, AND BEING A PUBLIC COMPANY IS A MILESTONE WE WILL GET TO WHEN BOTH COMPANY AND MARKETS ARE READY. BUT, ABSOLUTELY. THIS IS AN OPPORTUNITY TO BUILD A LARGE PUBLIC COMPANY THAT WILL NEED THIS CATEGORY. CAROLINE: SHLOMO KRAMER, WE APPRECIATE YOU COMING IN TO VISIT US. CATO NETWORKS. WE WILL KEEP UP TO SPEED WITH THE GROWTH OF THE BUSINESS. MEANWHILE, WE ARE GOING TO BE DISCUSSING HOW ORGANIZATIONS CAN ENSURE ETHICAL USE OF ARTIFICIAL INTELLIGENCE WITHIN THEIR WORKFORCE. YOU WILL HAVE THE LATEST FROM
THE LLOYD SURVEY ON AI ETHICS. -- DELOITTE SURVEY ON AI ETHICS. ED: LOOKING AT SHARES OF GOOGLE. THE DIGITAL MARKETS ACT KICKS INTO EFFECT THIS WEEK. WE HAVE ZEROED IN ON APPLE BECAUSE OF THEIR NEED TO COMPLY, THAT I WOULD ALSO BRING YOU AN UPDATE. DOWN DETECTOR IS ALSO SAYING YOUTUBE IS EXPERIENCING OUTAGES ALONGSIDE OUR REPORTING THAT MANY OF META'S PLATFORMS ARE DOWN. THE STOCK DOWN 1.5%.
WE'LL KEEP AN EYE ON ALL OF IT. THIS IS "BLOOMBERG TECHNOLOGY." CAROLINE: LET'S GET BACK TO ARTIFICIAL INTELLIGENCE AND ITS IMPACT ON THE FUTURE. SAN FRANCISCO-BASED VENTURE FUND HAS WRITTEN AN OPEN LETTER MAKING A PLEDGE TO BUILD AI THAT IMPROVES LIVES AND UNLOCKS A BETTER FUTURE FOR HUMANITY. IT IS YET ANOTHER OPEN LETTER
THAT WE HAVE SEEN, AND THIS TIME THIS ONE WAS SIGNED BY OPENAI, GOOGLE, META, MICROSOFT, AND MANY OTHERS. THIS IS A WAY SOME MAY ARGUE ABOUT HOW TO IMPLEMENT AI ETHICS. WE ARE GOING TO GET INTO THE MORE SPECIFIC WAYS. ED: THEY ARE NOT ALONE IN THAT. DELOITTE RELEASED A NEW STUDY TODAY ABOUT JUST THAT. HOW ORGANIZATIONS CAN COMPARE -- CAN PREPARE THEIR WORKFORCE FOR AN ETHICAL USE OF AI. JOINING US FOR MORE IS DEVOID TECHNOLOGY'S ETHICS PRACTICE LEADER. ALSO THE AUTHOR OF "ZERO LATENCY LEADERSHIP,"
A BOOK THAT TAKES A LOOK AT LEADERSHIP IN THE AGE OF AI. BEENA AMMANATH JOINTS ME. CLEARLY THERE IS A CONCERN ABOUT HOW EVEN A TECHNOLOGICALLY-SAPPY WORKFORCE USES AI FROM AN ETHICAL PERSPECTIVE. I KNOW HOW DELOITTE WORKS. THERE MUST BE A REASON YOU FELT COMPELLED TO PUBLISH THAT STUDY. BEENA: ABSOLUTELY.
I AM A TECHNOLOGIST BY TRAINING, AND WE HAVE SEEN THE RAPID EVOLUTION OF TECH KNOWLEDGE HE. BUT TECHNOLOGY COMES WITH SIDE EFFECTS. THERE ARE RISKS THAT COME ALONGSIDE IT, AND THERE IS NOT AS MUCH ON ETHICAL RISKS, THE TRUSTWORTHY RISKS THAT COME WITH TECHNOLOGY. WE THOUGHT IT WAS IMPORTANT TO HIGHLIGHT IT, RAISE AWARENESS, AND REALLY GET COMPANIES TO ADDRESS THE ETHICAL RISKS SO WE CAN TRULY GET THE FULL POTENTIAL OF AI. CAROLINE: I WOULD SAY THAT THE MEDIA, THE
DISCOURSE, THE LATEST NEWS HAS BEEN DOING A LOT OF THE HEAVY LIFTING FOR YOU. WE WERE JUST TALKING ABOUT THE LATEST OPEN LETTER. THERE HAS BEEN HANDWRINGING ABOUT ETHICS, IMPLEMENTATION OF AI. WE HAVE ALSO HEARD CONCERNS ABOUT THE LATEST IMAGE GENERATION AND WHETHER OR NOT TRYING TO CORRECT FOR ONE DIRECTION THEY ARE BIASING AND NOT GETTING HISTORICALLY-ACCURATE IMAGES.
I'M INTERESTED IN WHAT CEOS ARE ASKING YOU THAT THEY CAN DO TO IMPLEMENT RIGHT NOW. DO THEY SLAM ON THE BRAKES ABUSING CHATGPT OR GENERATIVE AI? BEENA: ABSOLUTELY NOT. THERE ARE RELATIVELY LOW-RISK WAYS TO USE THE TECHNOLOGY, AND IT IS IMPORTANT TO IDENTIFY THE RIGHT USE CASE. I THINK THIS IS A VERY POWERFUL TECHNOLOGY.
WE SEE A VARIETY OF USERS ACROSS DIFFERENT PRODUCTS, DIFFERENT FUNCTIONS. IT WAS ABOUT FINDING THAT RIGHT OPPORTUNITY OR YOU CAN GET THE MAXIMUM VALUE WHILE MINIMIZING THE RISK. WHAT CEOS ARE LOOKING AT IS, HOW DO YOU IMPLEMENT THE RIGHT ETHICAL POLICIES AND GUIDELINES TO GET THAT MAXIMUM BENEFIT.
-- BENEFIT? ED: YOU WERE JUST SHOWING A CHART. I COULD NOT BELIEVE WHAT I JUST SAW IN THAT CHART. IF WE CAN LET'S BRING IT BACK. 84% OF RESPONDENTS SAID THEY
CURRENTLY ARE USING AI. WHAT FOR? THINK ABOUT ALL OF THE BUSINESSES THAT DELOITTE WORKS WITH, BIG AND SMALL. WHAT DO YOU MEAN 84% HAVE BEEN USING AI? BEENA: I DON'T THINK IT IS GENERATIVE AI SPECIFICALLY, WHICH IS THE CURRENT FLAVOR SINCE THE LAST 18 MONTHS.
IT IS AI FOR PREDICTIVE ANALYTICS, FOR MAINTAINING YOUR JET ENGINE. FOR -- FOR MY FINANCE PERSPECTIVE, FROM AUTO-APPROVING EXPENSE REPORTS, RIGHT? THERE ARE A LOT OF BORING AI USE CASES THAT COMPANIES ARE FOCUSING ON AND HAVE BEEN FOCUSING ON. LOOK, I MYSELF HAVE BEEN APPLYING AI FOR OVER 12, 13 YEARS. GENERATIVE AI IS THE CURRENT FLAVOR, BUT WHEN YOU SEE THAT NUMBER IT IS TALKING ABOUT HOW COMPANIES HAVE BEEN USING AI FOR MUCH LONGER TIME. CAROLINE:
AND NOW COMPANIES TRY TO GET IN PLACE THE GUARDRAILS. DO YOU THINK WE NEED MORE GOVERNMENT-ENFORCED GUARDRAILS? BEENA: I THINK THERE IS ABSOLUTELY A NEED FOR AI REGULATION AND POLICIES AND BEST PRACTICES. IF YOU TAKE A STEP BACK AND LOOK AT IT, AI AS A TECHNOLOGY IS STILL MATURING. AND THERE IS A BALANCED STREAM,
WHICH IS THIS ETHICAL RISK. COLLECT THE SIDE EFFECTS. ITS IMPACT TO THE WORKFORCE. THEY IMPACT THROUGH THE ORGANIZATION ITSELF, RIGHT? AND IN THE THIRD STREAM IT IS AI REGULATIONS AND POLICIES. WILL EACH ONE OF THESE MOVE AT A DIFFERENT PACE? BUT IT NEEDS TO HAPPEN, AND WE HAVE SEEN IT ACROSS DIFFERENT INDUSTRIES HAPPENING OVER TIME. ED: I THINK THERE IS AN ACCEPTANCE THAT A LOT OF THE FOCUS IS AUTOMATION, REMOVING THE ROLE OF A PERSON THAT MIGHT HAVE BEEN MUNDANE.
WHAT KIND OF PEOPLE DO FIRMS NEED TO HIRE IF THEY ARE GOING TO THINK ABOUT AI? BEENA: OUR SURVEY SHOWS THAT COMPANIES ARE ACTUALLY HIRING MORE AI ETHICS RESEARCHERS, COMPLIANCE SPECIALISTS, TECH POLICY ANALYSTS. OVER 50% OF ORGANIZATIONS ARE GOING FOR THAT GROUND-LEVEL ROLE, AND ABOUT 30% ARE GOING FOR CHIEF TRUST OFFICERS OR CHIEFLY AI ETHICS OFFICERS. THERE IS THAT NEED TO FOCUS ON AI ETHICS RESEARCH AND BRING IT TO AN ORGANIZATIONAL AND USE CASE LEVEL. CAROLINE: WE THANK YOU FOR BRINGING YOUR
EXPERTISE TODAY. DELOITTE TECHNOLOGY'S BEENA AMMANATH. MEANWHILE, WE WILL GET BACK TO IT, BITCOIN'S RALLY. IS IT SUSTAINABLE? WE ARE GOING TO DIG INTO IT WITH JALAK JOBANPUTRA.
THIS IS "BLOOMBERG TECHNOLOGY." CAROLINE: LET'S GET BACK TO BITCOIN. IT HIT A NEW RECORD HIGH, AND ITS RECORD MARKET CAPITALIZATION HAD ALREADY BEEN HIT. BECAUSE THERE IS MORE BITCOIN IN CIRCULATION.
NOW ALMOST COMING UP TO A $1.25 TRILLION MARKET CAPITALIZATION. LET'S GET TO MORE BROADLY HOW THIS AFFECTS THE REST OF THE ECOSYSTEM AND INVESTING. JALAK JOBANPUTRA IS WITH US, MANAGING PARTNER OF FUTURE PERFECT VENTURES. YOU WERE IN CRYPTO BEFORE CRYPTO WAS COOL.
AND I'M INTERESTED ON WHETHER WITH BITCOIN RAMPING UP HIGHER, PEOPLE WORRYING ABOUT LEVERAGE COMING TO THE SYSTEM AGAIN, ARE WE BRACING OURSELVES FOR COUNSEL -- FOR CONSOLIDATION? OR ARE WE ON THE MARCH FOR SUSTAINABLE REASONS? JALAK: WE HAVE A CONFLUENCE OF FACTORS THAT MAKE THIS RALLY DIFFERENT. FIRST WE HAD ETF LAUNCHES, WHICH WERE OFF TO A BIT OF A SLOW START, BUT BLACKROCK'S HAS BEEN THE MOST SUCCESSFUL IN HISTORY. WE CONTINUE TO SEE INTEREST FROM INSTITUTIONS COMING INTO THE SECTOR. BLACKROCK IS ALSO LAUNCHING A BRAZIL ETF PRODUCT FOR SPOT BITCOIN. YOU'RE GOING TO SEE NOT ONLY THE U.S., BUT THE REST OF THE WORLD CONTINUE TO HAVE MORE ACCESS. THAT SHOWS THAT YOUR IN A
DIFFERENT SITUATION THAN WE WERE IN PREVIOUS RALLIES AND CONSOLIDATION. WE ALSO HAVE BITCOIN HAPPENING AS SOME OF US CALL IT, WHICH TRADITIONALLY CONSTRICTS THE SUPPLY OF BITCOIN, BECAUSE IT REDUCES THE REWARDS THAT BITCOIN MINORS GET. THESE TWO FACTORS, ALONG WITH MORE FAVORABLE REGULATORY MOVEMENTS AROUND THE WORLD POINT TO US CONTINUING TO GO HIGHER. THAT DOESN'T MEAN WE WILL NOT HAVE PULLBACKS ALONG THE WAY, BUT THE MACROENVIRONMENT IS SUPPORTING HIGHER HIGHS. CAROLINE: THE EXUBERANCE AROUND BITCOIN HAS SPILLED INTO OTHER AREAS.
ETHER IS ON THE UP, SOLANA. THEN, LIKE 2021, THE MEME COINS COME BACK. SOME OF THEM THINKING THERE WILL BE SOME PRACTICAL USE CASE. WHAT ARE THE SPILLOVER EFFECTS? ARE YOU WORRIED ABOUT TOO MUCH EXUBERANCE IN DICEY AREAS OF THE MARKET? JALAK: THERE IS ALWAYS GOING TO BE SPECULATIVE ACTIVITY WHEN WE SEE BITCOIN AND ETHEREUM AND SOME OF THE BLUE CHIPS CONTINUE TO GO HIGHER. PEOPLE ARE LOOKING FOR EVEN HIGHER RETURNS WITH SOME OF THESE LOWER LIQUIDITY LONGTAIL PROTOCOLS, AND SOME OF THEM ARE THESE MEME COINS.
THAT IS TO BE EXPECTED. INVESTORS NEED TO REALIZE THEY ARE DEALING WITH MORE VOLATILE ASSETS BUT WE HAVE SEEN SOME OUTSIZED RETURNS IN SOME OF THOSE NAMES YOU MENTIONED. ED: THERE ARE MORE LONG-TERM HOLDERS OF BITCOIN, AWAY FROM INFLOWS, OUTFLOWS OF ETF'S. THE PRICE. WHAT DOES THAT TELL YOU, THE DATA POINT. -- JALAK: THE DATA POINT? JALAK:IT SHOWS THERE IS LONGEVITY OF THIS ASSET CLASS THAT WE HAVE SEEN MORE AND MORE PEOPLE MOVING BITCOIN OFF OF EXCHANGES, WHICH MEANS THEY ARE NOT GOING TO TRADE.
THEY ARE STORING THEM IN HIGHLY SECURE WAYS, WHICH MEANS THEY ARE LOOKING AT THIS AS AN ASSET THAT COULD HEDGE AGAINST INFLATION. WE HAVE SEEN A LOT OF BACK-AND-FORTH ON OUR INTEREST RATES GOING TO, BECAUSE ARE THEY GOING TO HOLD STEADY? ARE THEY GOING TO INCREASE? BITCOIN PROVIDES AN ASSET THAT IS INDEPENDENT OF THIS GOVERNMENT POLICY AND MORE AND MORE PEOPLE WORLDWIDE WANT TO HOLD THIS. ED: CAROLINE MENTIONED YOU WERE INVESTING IN BLOCKCHAIN STARTUPS BEFORE IT WAS COOL. HAS YOUR APPROACH CHANGED OVER THE YEARS IN THE TYPES OF COMPANIES YOU NOW WANT TO BACK? JALAK: WHAT IS EXCITING NOW VERSUS 2013 WHEN I FIRST STARTED INVESTING IN THE SECTOR, I MEAN, BITCOIN WAS REALLY THE ONLY CRYPTO PUBLICLY TRADED CRYPTO YOU CAN INVEST IN, AND THEN THERE WERE A NUMBER OF EXCHANGES WE INVESTED IN. DATA ANALYTICS COMPANIES AROUND CRYPTO ACCESS. THERE WAS A LOT OF
INFRASTRUCTURE THERE. NOW WE HAVE SEEN 10 YEARS OF BUILDOUT NOT ONLY IN BITCOIN, BUT IN ETHEREUM AND ALL OF THESE LAYER TWOS. I ALSO INVESTED IN THE EARLY INTERNET IN THE 90'S -- 1990'S. BACK THEN WE COULD NOT WATCH VIDEOS ONLINE. IN 2013I SAID, WE CANNOT EASILY
ACCESS AND TRADE BITCOIN, AND 10 YEARS LATER WE HAVE ETF'S. SO, IT IS VERY SIMILAR PROGRESSION. I WOULD SAY EVEN FASTER PROGRESSION AS WE SEE THE BUILDOUT.
SO, JUST LIKE, YOU KNOW, ANY ASSETS NEED CUSTODY, NEED MARKET MAKERS, WE HAVE SEEN ALL OF THAT. SO, THE OPPORTUNITY SET FOR INVESTING IS EVEN WIDER THAN EVER BEFORE. WE ARE INVESTING OUT OF OUR THIRD FUND. IT WILL BE OUT TO MARKET WITH A FOURTH FUND SHORTLY, AND WE NEED -- WE SEE MORE AND MORE INTEREST AND GROWTH. ED: JALAK JOBANPUTRA, THANK YOU FOR CATCHING UP. YOU TAKE YOUR WORD FOR IT, IN
IT BEFORE IT WAS COOL. GOOGLE HAS ISSUED A STATEMENT SAYING IT IS WORKING ON A LOADING ISSUE FIXED FOR YOU TO DO IT CURIOUS TIMING THAT DOWN DETECTOR SAYS YOUTUBE IS DOWN ALONG WITH THOSE OTHER PLATFORMS. CAROLINE: ACROSS THE BOARD WE ARE SEEING FACEBOOK BEING -- BEING IMPACTED. WE WILL HAVE TO SEE. 20 OF RATHER AMUSING MEMES COMING OUT OF ELON MUSK TODAY AS SOME OF THESE CHIEFS HAVE TO GO TO X TO TELL US ABOUT THESE ISSUES. THAT DOES IT FOR THIS EDITION OF "BLOOMBERG TECHNOLOGY." CAROLINE: ED: ED:
2024-03-09 00:39
