>> from the heart of where innovation, money and power collide and beyond. this is bloomberg technology with caroline hyde and ed ludlow. ♪ caroline: i am caroline hyde in new york, above though is off today. all earnings coverage ahead as adobe falls the most since 2002. bitcoins slide from its record high continues. bubble talk escalates we will

talk about the bull run continuing. the house voted to ban tiktok or have a divested of what we can expect from the senate. benchmark is off about .6%. this is we anticipate volatility because expiration of a whole chunk of derivatives today. the vix taking up a little bit. we are the key get crypto and i'm taking a look at bitcoin. we close the week where we began overall. we had been getting the heavy highs of 70000 and currently trading at 68,000 so dipping

below that 70,000 level. moving on to individual movers. adobe is the only one you need to care about. the biggest move having its worst day in decades. can we dig into the individual numbers but the amount the stock ran up last year, people are worried. >> if you ask investors which company will make money it was microsoft and adobe and now investors are saying maybe it's just microsoft. they expected to see this big surge because of the ai products. adobe has been putting ai into photoshop and illustrator. but it appears they are more focused on acquisition and that

monetization is not coming for a couple of quarters. caroline: this is the biggest fall for adobes and 2022. i'm interested in how that focuses on some of the startups that are publicly traded. you saw the big one everyone looked out and thought, adobe is going teresa catch up. >> about a year ago with image innovation. they responded with innovations in photoshop. there is this energy in the air that this new piece of technology could make adobe obsolete. there was a conversation on the earnings where an analyst said folks are getting worried in the long run this software could be

unused. can you explain why that is not the case? thus not a level of candor or anxiety you hear on these calls. caroline: this is what investors want, transparency. we are hearing that from the ceo. is there anyone who is bullish that is thinking they're being conservative here and we will see generative ai come to profitability and sales? >> the beauty of being a big company is you can price for customer acquisition. that is what adobe is doing now to get all the creative's using its product and monetize it. that's the argument. some other folks may see the numbers and say we want a revenue uplift now. caroline: videos with prompts, that does feel like that's not just around the corner.

they were saying this next open oppenheimer with ai problems is not gonna happen. >> there is this understanding that ai will fundamentally change the way that applications for images and video happen. for now you will be able to tweak things on the margins. a decade from now will you have 4 million creative's paying for photoshop? caroline: for training data. >> adobes big pitch is that we have the safety, the copyright credentials whereas openai there is this idea of where are you

scraping it from? i saw an interview with the ceo saying are you scraping from you tube. caroline: there were plenty of memes made from that interview. it was brilliant to have you on. a big dive into the adobe shares having its worst days since 2022. bitcoin is retreating from a selector -- record high. we will talk about why devon ryan. this is bloomberg. ♪

caroline: bitcoin is pulling back from his recent record highs it recently said and an intensifying debate that this --bull run, is a monster cycling crypto this show starting. sonali: you have seen inflows in those etf's and this never before seen dynamic and bitcoin were you will have more demand while supply is decreasing. there is leverage in these markets. not surprising to see a pullback. everyone from glenn goodman to ed nova gratz has expected a pullback. as some point when you're buying things on margin there is this potential for a little bit of a

reversal. you do only see has come full circle for the week. we have been well above 67,000 but we have seen highs of 72,000. caroline: we keep talking about institutional buyers. sonali: think about how much leverage there is in the system right now. it is not the same leverage we saw and 2021. the type of leverage you are seeing is things like binance perpetual futures which are largely outside of the united states. you have those and bitcoin futures as well that you buy on margin and other forms of leverage. issuing bonds to buy bitcoin and other big crypto players tapping debt markets in order to capture a part of this boom. you can make an argument that

the leverage you are seeing is happening through safer entities. use think about the leverage in leveraged etf's trying to amplify their exposure to bitcoin at these prices. everything you expected out of the positivity priced into bitcoin. caroline: keeping an eye on correlations. bitcoin is down in the correlations between bitcoin and the optics. we speak to devon ryan, it's great to speak to you again. some of your notes of been extraordinary with the sheer scale of money entering the space and where you see the price points going. can you talk us through your

main thesis of what these could do? >> thank you for having me on. we put out a note earlier this week and we are talking about 220 billion of evan flows into these etf's over the next years. there has been 10 billion in net inflows but we see that accelerating because we have opened up additional capital the historically until january this year was shut out from investing in crypto and bitcoin specifically. advisor led money, about 25 trillion in assets where advisors when a custody that money within their own custodian. these advisors with etf approval can look at that but were in the first inning. when we see flows accelerating from here there will be

volatility but in my career covering financials, follow the flows. where there is money coming in that substantial it's transformational. caroline: it's amazing we have talking about these cycles for years but only now do we have the likes of you talking about 220 billion coming in and burstyn talking about this monster cycle for crypto. what changed your tune? was it etf? devin: we've been consistently constructive on the basin i cover -- coinbase. i think many cryptocurrencies will be worthless over the next few decades. that being said we are in the early inning so people are

putting chips on various blockchain's and just like you would in a technology stock in this formation days it will take 10 years before it becomes a commercial application. i am very bullish on the blockchain technology. thus the broader ecosystem that coinbase is benefiting from. an etf is its own animal. we think people will increasingly move some money, small amounts over 100 trillion of capital in the u.s.. we are shut out until january 11. caroline: the mission coinbase of my husband is a director over coinbase. outside of the space, bitcoin has who read up all the oxygen. there is talk of an etf like

solana doing well. how does that spillover affect continue? devin: there's a lot of discussion in the market with the bitcoin etf would be cannibalistic because they would trade the etf and that would hurt coinbase. i think the evidence is clear that in reality there has been more money moved into the broader skate. both bitcoin where coinbase is participating in trading in underlying assets but their volume syrup 20% over the first quarter of last year and a lot of that's happening in all the other assets because people are more interested in learning about the space and taking views on other blockchain technologies. i think we are still in the early days as well. coinbase is going to have their

hand in every aspect of how this industry grows. whether it's globalization, payments and remittance of development. they have their own blockchain called basin there will be a lot of innovation in this industry that hasn't even happened yet. coinbase is a play on that growth even more so than trading volumes. caroline: it's interesting bernstein called out robinhood is the key play. where else could be benefiting in terms of brokerages. does it all about the institutional player in the retail play? devin: galaxy s8 name they are a clearly market play. there are little interesting companies, robinhood has an investor base in the demographic that is active and not as big of

a driver for their business model. robinhood is both training and development and how blockchain is used over the next 5-10 years. robinhood has tentacles into some of that but robinhood has broader brokerage. a lot of brokerages are fairly there yet. i would put it in the bucket of retail investors and we estimate billion of net flows 70 billion will come from retail whether self-directed or advisor led. i've covered the cell flood market and these folks are relatively conservative but they want to invest for the customers want to invest in their people want access to this new asset class. caroline: sticking with it,

devon ryan. it's great to talk to you. coming up, april first microsoft copilot for security will be made widely available. we have all the details for you. this is bloomberg technology. ♪

so this is pickleball? it's basically tennis for babies, but for adults. it should be called wiffle tennis. pickle! yeah, aw!

whoo! ♪♪ these guys are intense. we got nothing to worry about. with e*trade from morgan stanley, we're ready for whatever gets served up. dude, you gotta work on your trash talk. i'd rather work on saving for retirement. or college, since you like to get schooled. that's a pretty good burn, right? got him. good game. thanks for coming to our clinic, first one's free. caroline: time now for talking tech. tiktok owner bytedance human resources chief is seeking to help the gaming division and refocus on personal content to avoid the head-on class. it's a pivot that hope to take on tencent. the chinese government is

encouraging ev makers to reduce reliance on western imports to boost china's semiconductor industry. the u.s. plan will fund samsung's in texas. now let's turn our attention to cybersecurity top of mind for executives, you and me as individuals. microsoft personal secretary -- security management. there isn't ai offering widely available on april 1. how much easier as her life going to get? >> is so great to be here with you thank you for having me. to understand why we did

security is to step back to face the sophistication of attacks. we saw an increase in identity attacks. this is why we designed the profile of security, the industry's first generative ai product that's based on open ai models. i do believe the next 18 months of aei innovation will determine the next 18 years of cybersecurity. we believe that security will help all defenders. caroline: this has been quietly rolled out and tested. what is interest in bound look like? >> we announce copilot for security and women to private

preview with customers because we wanted to do code creation and last fall we expanded that to hundreds of customers as well as partners and what we have seen through that is it is making defenders fasters. we have seen 97% of people want to use the tool again there so -- there is a lot of positive sentiment and feedback. caroline: you are in charge of the security business up microsoft and you have had recent disclosure about chinese hackers, the russian affiliated pack we understand. they said this compromise is inexcusable. how much questioning to have on that and is it impacting demand

for security products or microsoft? vasu: we published on guidelines we are taking. we continue to do all we can to protect microsoft and our customers and integrate the knowledge from the landscape to protect comprehensively. caroline: has it hit sales? the compromise from the russian hackers it was cybersecurity 101. vasu: we are continuing our investigation. we continue to see our customers use cybersecurity tools. for copilot for security. caroline: how would set believe? where are you seeing the demand come from and what kind of

clients? vasu: we have seen global demand for this and we are making it available globally as well. we started in english but are rolling out new languages. japanese, portuguese, spanish etc.. we expect to roll this out globally. customers worldwide and the way we designed cybersecurity is for all. we brought in all kinds of defenders to use it from the private and public sector. caroline: being is present in china. do you have inbound interest coming from china? vasu: we have interest across the world for our security products and we have it available globally.

we integrate 15 categories and boundaries that follow microsoft's cloud and depending on where customers are in their journey. some used to. given others one or two products we have 700 thousand customers using four or more of our products. caroline: have you had any pressure to pull back on your product? vasu: we have a seed any pressure to pull back a product. caroline: we want to thank you for your transparency to talk about your product in the demand you continue to see. vasumati p jakkal we thank you. we will dig into the legal angle of the tiktok story. david green civil liberties director is coming up next. this is bloomberg technology.

♪ it's easy to get lost in investment research. introducing j.p. morgan personal advisors. hey david. connect with an advisor to create your personalized plan. let's find the right investments for your goals okay, great. j.p. morgan wealth management.

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but then they unexpectedly unraveled their "price lock" guarantee. which has made him, a bit... unruly. you called yourself the "un-carrier". you sing about "price lock" on those commercials. "the price lock, the price lock..." so, if you could change the price, change the name! it's not a lock, i know a lock. so how can we undo the damage? we could all unsubscribe and switch to xfinity. their connection is unreal. and we could all un-experience this whole session. okay, that's uncalled for.

caroline: welcome back to bloomberg technology i am caroline hyde in new york. let's check in on these markets. it is a volatile one. we have an expiration in derivatives. i am looking at the vix take up a little bit but we are some .9% lower on the s&p. there is plenty of talk of bubbles and too much froth within the markets. we dial it back as we head to the federal reserve next week. will they stand by the number of

cuts they've made for this year. we saw record highs in bitcoin and we are dialing it back. we are tracking back at where we were on monday at 68,000. i'm looking at what's happening on individual movers in and be is the one to watch. still posting growth but not as much as people want to see especially from generative ai. we are down 14%. nvidia is up 1.4% but it could end the ninth straight gains this week. keep in i on nvidia on if we could keep pushing higher. ppd, even with the u.s./china tension. ppd having a rapid week of

nearly 12% on the chinese name. still the desire to get into some chinese companies. let's talk about broadly what we've seen with tiktok in china. we've heard from the senate committee on the ban or divestment. >> they are collecting the norms of on a personal data. tiktok knows what you like before you may know and that personal data of that 170 million who are on 90 minutes a day. if you don't think that's a security risk or you can be blackmailed by agents of the chinese government. you don't understand the unfortunate world we live in. caroline: that's a senator who wants let's get to alex barinka for the latest. it was such a rapid week with

that getting through the house with real momentum. the idea of a ban, but the senate seems to be slowing down. >> it just seems like it is slowing down and this and up a few reasons. we heard from senators from both sides of the aisle who are basically in support of some kind of regulation either tiktok but not so fast we need to take a look at this bill. richard blumenthal said he said support of separating tiktok from bytedance but warned the deadline and the bill of 165 days was too short. that's one knock against this. a very interesting name was ted cruz who has been a voice against tiktok and sits the congress committee which has

jurisdiction. he said this bill should be referred to the senate panel for more work. that this bill would go through the full amendment process which would slow it down. we are months out from the november u.s. election. does anybody want to be going back and forth on this bill or do they want to be out on the road campaigning? that's a valid question to ask as they consider the timing on whether or not to take this forward. caroline: and whether the u.s. population thinks this is a priority or hates it. tell us about how we have seen a mobilized dead sea. have they been talking to their representatives. trump seems to be going against it because of the backlash. >> there have been lawmakers whose phones have been flooded with calls from constituents who

say don't vote this bill through. 170 million use these apps in the average age is over 30. and for the democrats they really relied on young people in the last election and the midterms to help them when on the ground. the president biden said he would sign this bill if it passed through both chambers. politicians need to pay attention. turnout could be lower in the past. it is upsetting that cohort of people a good idea? even if they think this is important legislation on data privacy in tiktok. caroline: this whole debate throws up so many questions. who would buy it if they were divested.

who are the names in the ring? >> it's an interesting shortlist. they put u.s. business at 20-30,000,000,000. not too many people could write a check that big. we have already seen people like steven mnuchin come out and say i want to get a group of buyers to buy this asset if this goes through. while that list of names may be short right now if this bill does get signed i can guarantee we will have folks across the board saying this is an incredibly valuable asset what can we do to put together a consortium so we can keep this moneymaking asset in the hands of americans. caroline: perfect person to be

talking about all of this thank you so much. let's talk to the legal implications of any potential bad or divestment of tiktok. diniz greenberg at the electronic frontier foundation defensive liberties. was been interesting is the reticence from certain senators is we can't employ a leaf out of china's spoke with is to ban social media that we don't like is that something you are thinking about? david: i'm thinking about it quite a bit and i'm glad that senators are thinking about it as well. the u.s. without exception over the past 60 years has been a champion for the free flow of information around the world and we have chastise other

governments when they have shut down apps calling it undemocratic. most recently and famously when nigeria shut down twitter because it accused twitter of dice emanating misinformation about the nigerian government. the u.s. state department issued a strong statement that even if they did not like the content it was undemocratic to cut off a motive communication used by his people and we are now doing the same thing. here we are using an undemocratic playbook to address concerns. caroline: those concerns let's dwell on them. maybe you say we need to adopt a

leaf out of the book because we can't risk manipulation on the platform and u.s. data getting into the chinese. couldn't they access the data without tiktok? david: there are good reasons to be concerned about the amount of data that tiktok and every other social media service collect about u.s. users. they collected a tremendous amount of data, retain it and share it widely. there's an industry of data brokers that buy information and sell it across the world including to governments like china and foreign adversaries. even those who don't operate their own companies. regardless of the onus on bytedance it has information on u.s. users.

the bill that the house passed is not a privacy law. it has very few provisions that guarantee privacy for u.s. users. just shutting down tiktok will be a tiny step in largely ineffectual in protecting u.s. data. caroline: why, if we hear from elizabeth warren, she once a broader privacy law. is that lobbying or the negatives to that privacy overreach? david: i don't know. i don't know what the reluctance of congress is been. in a stock completely easy to write a good data privacy law and we haven't been completely pleased with a lot of the proposal because we don't think they go far enough.

i don't know what the political obstacle is. it really makes me question because it has been so difficult to pass a data privacy law and so easy to get this tiktok bill through. it makes me question whether the motivations behind this tiktok bill our data privacy because the sale through the house and private legislation has had a much tougher song. caroline: tiktok issued a statement that it has gone through for one reason because is to ban. david greene thank you very much. coming up we will be speaking with alice bentinck from entrepeneur first lp talking about bringing entrepreneurs to the bay area. let's focus on what's happening

in africa. there has been a lack of access to the internet and undersea cable damage has seen kate -- outages. they are trying to tackle these issues of connectivity and multiple undersea failures are impacting providers. microsoft impacted as well. they've seen a disruption to their cloud services and microsoft 365. this is bloomberg intelligence. ♪

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caroline: this is bloomberg technology and you are looking at the principal room. coming up at 12:00 bloomberg real yield. watch out for sonali. this is bloomberg. ♪ caroline: entrepreneur first

invest in early career technical founder talent that is now opening up in san francisco to connect the founders and the best technology ecosystem. let's bring in alice bentinck which i know well for covering the london scene and seeing the rise of the avenue and you built offices in bangalore, paris. what does san francisco half that other ecosystems don't. alice: back in 2017 we have been plugged into this ecosystem for a while. there is a huge demand of investors to invest in talent that comes from europe and asia. we have had and teresa and

sequoia invested in our companies at an early stage. we are building a bridge between the talent and founders we have seen in europe and asia and bringing them to the bay area. bringing them to the wider ecosystem of the bay area. caroline: if you've already have this talent and success. we see a portfolio more than 10 billion in these companies are well known in europe in worldwide and received funding from reid hoffman. why should need to be even more plugged in if it's already worked so far? alice: the bridges building in both directions. we see many firms opening offices in london to access europe but this is the strengthening of the ties between the two ecosystems. by bringing our companies here and helping them access the

level of competition and depth of network is about who you can hire and who you are surrounded by and were excited to give our custom ease -- companies access to that. caroline: what have been to the nurse to the founders coming over. where did they see the worries? alice: 33 companies have joined us out here. some of the worries around running a company here. the cost is offset by the benefit of the ecosystem. the real opportunity is to expand ambitions to expanded the u.s. market and give them access to an opportunity that they can't access in europe. in the u.s. market is so large and we believe this gives them the butter opportunity to build a global company from the beginning. caroline: what kind of companies

have come. we cna i focuses that the kind of slate you've seen come over? alice: ais the technology of our generation and the majority are using ai in some way. we've been investing since 2014. that's a great example of why we're doing this. we had a founder from romania and france that built together in london and got their seed investment from a firm based in san francisco. that demonstrates the importance of the bridge between the two ecosystems. caroline: you're clearly bringing in geographic diversity and it's an interesting concept built signing those founders early, backed them free idea,

preteen and built it from within. what is the cohort looking like? it's a boring question from one one to another but there is not question of diverse city? alice: diversity is always a challenge. 20% of our founders are women. we know his struggles with gender diversity and we've been intentional about we built an organization alongside code first girls which teaches women to code for free across europe and has been an important driver to change the numbers that we see founding companies. it's something we take seriously. caroline: alice bentinck cofounder of entrepreneur first. next up we will be talking with

andrew feldman founder of cerebras systems inc we will be talking about ai and so much more. this is bloomberg. ♪

caroline: let's get into generative ai. we will be speaking with cerebras systems inc that is announcing their third wayfair chip. a new ai supercomputer digging

into all of it is andrew feldman co-founder is ceo of cerebras. andrew: in a new generation one hopes to do the same work in half the time and that is what we were able to achieve. this is a 4 trillion transistor tip. the largest ship ever made in the computing industry and is optimized for the training of big generative ai and slashes the amount of time it takes to complete these projects. this is a huge step forward. it cuts the cost per unit to compute and half in the

foundation of a new supercomputer we are building. it's big week for us in the industry. caroline: we could see from the art behind do the architecture. what does this mean? talk to us for the audience who doesn't know exactly how the biggest ship in the world is made, what technology goes into that? andrew: the art behind us is the chip. one of our engineers got fired up. a chip of that size take years of development. it involves thinking of how you are going to do the math underneath artificial intelligence. what it means for your everyday user is their mapping software

that uses ai is more efficient. the recommendation engines the select the correct things for them in their shopping or netflix is even better. it means the generative ai model say play with whether it's chatgpt or others, these are less expensive. these have bigger impact that work. as he bill foster compute, the ai infrastructure allows the ai to permeate through the economy, the way we live, work and play. caroline: that's a big announcement ahead of nvidia's big event next week. we thank you so much in andrew feldman who is a key player in

ai. you don't want that forget to catch our podcast you can find it online. we have had a big one in terms of tiktok. go back to consume at all. this is bloomberg technology. ♪

sonali: bloomberg real yield starts right now.