emily: i emily chang in san francisco. this is boomer technology. in the next hour, tencent has suffered its worst first profit drop in over a decade as the chinese government cracked down on new gain releases -- game releases. can they recover? andto volatility continues so do opportunities for investors hoping to buy in. we break down the short and long-term outlooks. goldman sachs confirmed it is

buying tesla as it looks to go private. the bank was not on board with musk tweeted earlier of this week. could u.s. national security officials locked to go private plan anyway? to our top story, it looks like facebook has disappointing tech earnings. the results are out of china were tencent posted its first profit drop in a decade. shares plunged as much as 10% on the news. thaniant has now lost more $160 billion in market value since january. remember monday, chinese regulators forced tencent halt distribution of a popular videogame and froze and approval of the licenses amid a government shakeup. despite that, gaming and the popular we chat app are going strong. to discuss, we have the managing partner of msa capital and the celina bang -- selena lang. -- selena lang -- wang.

how concerning are the revenue and profit issues here for a company that has been going strong for a decade? in china,gaming space we have seen substantial amount of government involvement around consumer protection and regulation. that has been the theme of the last few weeks when we had a faulty vaccine peer-to-peer lending issues. it is not too surprising to see the struggles with some of the games coming out of the gate in the -- skate. in the long term, when it comes to tencent, some of the bigger issues lie with the loss of share of user time. other competitors are coming in to take up 10% of what used to be a market dominated wide tencent in that space. emily: one china's version of youtube, mobile gaming revenue declined 19%. how much of this, selena, is resulting eager issues in play

regarding the chinese government crackdown or others? >> the biggest crackdown is domestic regulatory problems. there is a shakeup happening in the government right now. because of that, there has been this power vacuum. none of the bureaucrats went to stand out and make a change that could severely hurt the government's broader censorship policy. because of that, licenses have been halted for several months. tencent was seen as his unshakable social media giant, bolo people forget, at its core -- but what people forget is that at its core it is a gaming company. regulations, they cannot catch up on some other bigger blockbuster games like fortnight. one of the biggest blockbuster games was forced to be recalled firstly after it was announced, shows they are not immune to the chinese government. that is why we see this reaction. ironic given the chinese government help these

tech giant flourish. bang, do you have any insight into why regulators are now cracking down on these games in particular and if there is any end in sight? ben: china has being going from a gaming side, people have quoted millions of people in china suffering from addiction. this has come to the front of the chinese agenda and they will continue to look at different platforms. various platforms are hit by accounts --ng bank by sucking bank accounts dry and this will be a trend for the foreseeable future in gaming. emily: selena, talk to us about the competition. where our user spending their time? selena: in terms of the gaming landscape, they have a lot of competitors there.

this crackdown is affecting industrywide. we will see players also impacted by this. in terms of we chat, tencent is facing similar problems that facebook is seeing. it is becoming so dominant that they are reaching saturation to the growth rate is flowing. one company has strong artificial intelligence able to draw users in and keep them into the ecosystem. there are a slew of asking a lot of traction in china. that being said, tencent is the dominant place where chinese internet users spend their time. they have this many program app that will also be a way to draw in users and users will be able to bypass the traditional app stores and directly use it services in we chat. they have a lot of things at work that are getting people within their ecosystem. that being said, they have a lot of competitors. emily: ben, what is your short

and long-term outlook? ben: i don't see any light at the immediate end of the tunnel for any of these games. one could get stuck in the regulatory pull process. i think their main revenue driver gain will be hit. in the long term, i think there are plenty of potentials for them to expand what they do. they need to continue to squeeze juice out of we chat and improve their payment mechanism. they need to look to add additional services that they have with identification, biometrics, things like that, and expanding along with new revenue streams. you saw things like cloud computing and payment search for them this quarter is that 81%. their monthly active users on payment is 800 million. they have an ingrained advantage because you are already in their app buying things, socializing with your friends, so it makes it easier.

to use things like payments they will have to cope with new regulation -- easier to use things like payments. they will have to cope with new regulation that each company has to have in the central bank. emily: tencent has invested $93 billion and -- in others -- hundreds of other companies including snap and tesla. other upsides to these investments? selena: they need to blame some of their profit declines in investment gains. they need to bankroll some of their other investments in other services. the snapchat investment, we have yet to see that, but they have not done so well. as luck, there is a lot of questions for that stock is going. know that they look at a lot of very early-stage startups. they have not come into any issues in terms of those areas. they are really focusing on early stages from tier tech investments.

we have yet to see how those will play out. emily: selina, i also want to talk to you about twitter so hang on. ben hanburg, thank you for joining us from beijing. twitter, after criticize from not bearing alex jones, twitter is now taking action. the ceo said he had not violated rules.s -- twitter's the new video has. >> any suspension whether it be a permanent or temporary one, makes someone think about their actions and behaviors. >> do you think this will change his behavior based on a timeout? >> you found it does have the potential to change behavior. emily: twitter is limiting his account access and you will not be up to publicly interact with users for a week, but he will be able to browse the platform. a, -- selina,linea

walk us through this. selina: twitter has not been clear on what he has violated, but he post the link to a video that directly incited violence against the media. now, twitter is doing this big 360 reversal after last week were said he had not violated any policies yet. they said we will take action when he does. so, the team decided they needed to take action. you heard from the short clip that jack seemed to say he was in this temporary timeout. the hope is that these types of things will convince people to change their behavior. there has been an outpouring of tweets after that interview clip came out about people saying there is no way alex jones is going to change his behavior as a result of this seven-day ban, which is not a true ban. he is still able to access --ets and send it directs direct messages. we will see what company which

wants to be in the future after this. it has been very clear about wanting rules and to stick to them, but the bigger question is, are they sacrificing values , and potentially, common sense people argue by sticking to these rules. emily: i'm looking at jack responding now to folks on twitter saying this very thing. if anything is not going to change his behavior, it is alex jones. jack is elaborating on his belief that a timeout works for some users, though certainly not all. do you think twitter and jack dorsey have a broader strategy here, or are they putting out fires of they arrive -- as they arise? selina: current employees are very upset with the direction this has gone and the field this decision is a solo jack decision even though a lot of people disagree with it. emily: why? what is the motivation? selina: i asked jack himself and he has not responded to me.

critics argue he would not want to alienate conservatives or all of alex jones's followers and wants to maintain this neutral platform. that is the very pessimistic view of why jack is doing this. on the optimistic view, they are trying to come up with a thoughtful, broad polity -- policy strategy they can apply across the board and not fall on the heels of what the larger competitors are doing. emily: selina wang, bloomberg tech, let us know. thank you. coming up, it's going and other quick dose have been under selling pressure this year. the number of products in the space continues to grow. his demand there or are buyers to skittish? like bloomberg news, check us out on the bloomberg radio app, bloomberg.com, and in the u.s., sirius xm. this is bloomberg. ♪

emily: the biggest producer of cryptocurrency is planning a hong kong ipo to raise as much as $3 billion. it is led by a millennial tycoon and it closed up private funding fund -- round. listing would be a landmark event for the cryptocurrency market moving from the fringes of finance and into the mainstream. if the ipo proceeds as planned, it would be a major test of investor appetite for digital current to companies after the market value of bitcoin has tumbled by more than 75% since early january. where does the industry go from here? we are joined by the ceo of bitwise asset management which launched three new crypto

currency funds and a member of the -- and we have a member of the advisory board at bitwise. with seen the huge tumble and a bit of a spike today. what is going on? checked, thet i large caps are up 10%, and mid-caps are up more. it's interesting to see how the mid-caps move. i think prior to this week, we saw a drawdown and that was an overreaction to the procedural extension of the egf of filing. today, the market is rebounding. i think investors and traders think the market went too far. emily: investors still don't seem comfortable with these etf's and continue to enjoy -- to reject them. the sec is running out of reasons to approve some of these things -- disapprove some of these things.

some of the biggest exchanges like gemini and coinbase have set up share-based things that appease the sec. i think they're running out of reasons and i don't think volatility is the core. at the end of the day, all early stage tech is volatile. afterwas $120 billion of hours trading wiped out alone. if going to zero dollars today, it would be smaller losses than what facebook at. emily: hunter, talk to us about 20 launched today with these additional indexes and what that means. hunter: last year, bitwise introduced cryptocurrency and we launched three new indexes today. index, arge, a mid-cap small-cap index, and the total market index. we announced an advisory board with include spencer as a leading venture firm. matt who is our global head of

research is on there as well and others. emily: >> over the last few months, we raised a few million dollars a month. this year, it will be larger than last month. we've seen a huge amount of interest and a lot of people are wondering on the timing. they don't want to catch a falling knife. they know they want to do something, but don't know when. we talk with the largest institutions and all of them are interested. we did a webinar recently with 500 advisors and 75% said they would consider an allocation of critical -- crypto. i think the interest is there. the question for people is getting comfortable with what the thesis will be. that was the top issue mentioned in the webinar. then, what timing makes sense. there is not a sense of rush right now.

didn't want to come in now with prices low? do they want to see if things play out? herim: the cofounder of et says the burdening of the ecosystem is getting stronger. would you agree with that assessment? >> undoubtedly. the industry continues to gain more developers, there is more institutional support with firms like goldman sachs announcing their rolling out a tray desk. custody providers are coming -- a trade desk. custody providers are coming online. things are going up last the nation and down faster than they should. the same thing happened in these markets because they are so retail dominated. this is one of the first financial markets where retail investors were first before institutional investors. in general, that means if

investors are more emotional, we go higher on the highs and lower on the lows. emily: i spoke to someone saying mass adoption is a long time coming. especially because of the regulatory issues around the united states and around the world. in other countries, there is no regulation at all. so mass adoption, how far out? >> i think their old regulations still apply. in terms of the time for mass adoption, i think that is a relevant point. i don't think brian is wrong about that. it will take time. whether that is one year, five years, 10 years, it is hard to say. it is safe to expect the way the internet has been employed and valuable applications were introduced in the 2000's, after 2010, uber was created, we would expect the application and deployment of public blockchain's and crypto assets will take time. like spencer said, we continue

to see positive signs in terms of the number being created. blockchain is a popular person with over 25 million. those are positive signs but it will take years. emily: what are the biggest risks? i don't see massive risk. the overall time is the biggest tailwind. dealing with these assets and opera financial efforts -- financial networks -- open financial networks will take large incumbents like blackrock are saying 0% of the clients are asking about crypto meanwhile, hunter is thing on a recent webinar with 500 ra's, the 80% they have been asked about crypto -- that 80% have asked about crypto. i think this is a marching -- is emerging outside of the industry heading toward it.

emily: spencer, hunter, think you both. -- thank you both. we will hear from andre iguodala next. this is bloomberg. ♪

emily: andre iguodala have three nba titles to his name and also has a hot list of tech investments. is oneden state warrior of the sports superstars making his name in global capital and says it is lot like building a championship basketball team. i spoke with him exclusively on the bloomberg player technology summit in san francisco. >> to invest in people. to invest in entrepreneur in -- pretty worse -- entrepreneurs. i've been taking under a wing

invest intor our says entrepreneurs. i have been on both sides of that and investing in entrepreneurs is the way to go. people that are genuine and have a passion. people that overly want to work hard and have the potential. those are the ones most likely will help you see through your investments. emily: what are parallels you found on the court and investing off of the court? andre: similar to being a general manager, actually. i've a good relationship with rtmm bob myers -- rtm, bob myers. we talk about finding the right is knowledge is together and putting the right coach in place. basically, you put a team together to win a championship and investing a similar. you have the right entrepreneur and putting the right cmo behind them and cfo behind them, you get the right market team in

place, you are making the right tires, you are going out and seeking the best recruits to come in and help your business grow, that is key. emily: talk about your portfolio and where you have had success. i have been investing in a lot of different companies ,hether it be consumer products and at the same time, sports related e-sports. tsm was my last investment. like scooters is another product that made headlines recently. withs that are close to me area in huffington and the wellness space and platform, i've dealt with sleep deprivation doing yoga, meditating, and changing my entire diet. that is something close to home i can preach about all day, not just those in the sports world, but normal walks of life. emily: have you had any exits so far?

made any money? andre: i've not had exits but had companies who are killing it. i've companies who are passed .n, and i regretted it that is the largest shoe marketplace platform, goat. i passed on it because it was my introductory meeting in at was the first -- and that was my first meeting and i did not know what to do with it. that was a great learning experience and i was able to get in on the last run. emily: that was andre iguodala. we will have more that exclusive our -- exclusive chat later in this hour. the roadblocks are piling up as elon musk tries to take tesla private. we will talk about who is on board and what national security officials may want to know about it. plus, we speak with the dropbox ceo on running a public company and the recent departure of the

coo. this is bloomberg. ♪ ♪

♪ emily: welcome back to "bloomberg technology." i'm emily chang. more headaches this week for tesla following musk's surprising go private plans. the s.e.c. has sent a subpoena to the electric carmaker regarding musk's statements about securing funding signaling that a formal investigation may be under way this according to fox. here is max with more. we also had reports that u.s. national security officials may have to clear this potential deal, and what exactly would u.s. security officials have to do with this?

>> as i said the other day, the issue is that with the trump administration where it's not totally clear how the government body that regular late foreign investments in u.s. companies would treat something like this. earlier this year the trump administration basically stopped deal on - broadcom security -- national security. saying that it would somehow hurt our interests and you could imagine a similar argument with batteries. tesla has a big chunk of the total electric vehicle company, specifically in the u.s. and plans to have a huge amount of president battery production. it's one of the many headaches that tesla and elon musk will be dealing with over the coming weeks, months, maybe even years. emily: reports on the s.e.c.

sending a system. david, walk us through the hurriedles that remain to getting a deal done. >> elon has a lot of things he has to get done. first of all, this issue with the s.e.c. seems to be just be getting worse and if they do open an official investigation, it will take a long time to wind through all this unless the s.e.c. quickly concludes he didn't do anything wrong. there are some shareholder lawsuits. he was sued when tesla acquired solar city in 2016. this is not related to whether or not he had funding lined up and whether or not he manipulated the stock. so these lawsuits are sort of running in parallel with what the s.e.c. is doing. again, more hurdles that could take time and he has to get a number of shareholders, in his own words, about 2/3 of them, to i agree to change -- exchange their private shares to

something more public. to a man who obviously doesn't like scrutiny and won't be as transparent once in company is private. he has to do that just to get to the points to convince the saudis and others to buy out those who don't wants to go with him. a lot to get done just to get to the point where he can push the deal again. emily: meantime, max, the board is even under even more scrutiny. musk has said he will abstain from these discussions as will his brother, who's also on the tesla board. also some tesla board memberers who are also on the board. reports that the tesla board is lawering up. talk to us about very complicated board dynamics. >> even in a normal buyout situation this would be sort of rough because the c.e.o. has a huge amount of carom and new over the company and it's hard

o have an arms' length transition. this is worse for two reasons, first, because ealone musk is so central to tesla. if he were to resign or be pushed out, you would imagine the stock price would fall because a lot of people believe he's crucial to their future. a majority of the board members have very close connections to elon musk so it's hard to imagine how they're going to valuate this transaction unbiasedly. we're not seeing any deals right now. it's not clear there's enough funding to make the original deal possible so we may be getting ahead of ourselves a little bit. emily: david, you have an must have na about

been revealing that the saudis would be such a big part of this but we're under an administration looking to limit foreign money. how does this affect this big wrinkle? >> the saudis already have close to 5% in tesla and the sovereign wealth fund would, according to elon, take on a bigger stake to help them take the company private and he's opinion talking to them since 2017 about doing that. one analysts estimates they could end up with a stake as large at 20%. if that happens, sure, he's out of the public markets. he doesn't have a bunch of -- sniping on social media and analysts asking questions on earnings call. what he does have is now a new shareholder sitting on his shoulder with a stake potentially as large as his.

the saudis are not like karl i kaun in the since they're going to they will him how to run a company. but you look at their investments, they do often ask those companies to make investments or hire people in saudi arabia. you could see maybe pressurea -- pressure on elon to build a facty in saudi arabia. but they're going to want something in exchange. emily: lots to continue to follow. david and max, thank you both. i know you'll continue reporting on this. since going public in march, dropbox has had some months and downs. it spiked on its first i.p.o. and again early this summer only to dramatically fall am the departure of the cremplet. o. i caught up and asked what's changed for him since going

public? >> in some ways it's going back to work or business at usually. wemb running the company like a public company for the past couple of years. if anything it's been bark to -- back to rescrulte crueting and building. >> you announced your c.o.o., dennis, who was there are if four years is leaving and investors seem spooked by that. should they be concerned? >> i don't think therked be concerned. dennis has been an incredible partner to me and when we joined the company, we are a fraction of the size. now we're a global economy with 2,000 peoples, offices around the world and it's actually because the business is in such great shape that he can pass the torch. fortunately he's built an awesome team. we'll business dines. i'm sure heap go on to do

amazing things but i'm sure the team he's left will as well. emily: what's your plan to get more individuals and corporations paying for these higher priced sub description plans. >> to me it's all about building a great product. ver the last few mans -- months, things like paper mplates and experience for admin. some of the newer teaches -- features like smart sink are nly available in the highest tier individual rppings -- prescription or in dropbox. we focus on making the fruct as good as possible and then on the back end do a lot of conversion and ways to match people with

either the pay plan that makes the most sense for them or a function that willy they haven't started yet. smart sink has driven a lot of the growth in revenue subscriber over the last couple of years. emily: you have cloud giants like am zone -- amazon and google and microsoft doing a bigger and bigger piece of the pie. what is dropbox going do? >> we've existed alongside the office suites and comings like microsoft and google plausm since the beginning. what our customers asked us to do was tie it all together. office space, they keep you within their apps but when we look at our mart artists. they have everything. dropbox and good-byele and -- google and no one subpoena

helping them pull all that together. the fact we help organize things plays to our strength. emily: the cloud landscape is changing dramenty. you and i having talking over the last taught nears -- years or so and it's almost been about the competition. what do you worry about? >> making sure that we have the best people and also just making sure we're placing the right portfolio -- it's striking the balance between continue to improve our core product then also developing new bructs like paper and planting seeds for ture development emily: what about planting seeds? do you intents to? bernie: absolutely. whether it's buying great town

in company. we've done a couple of acquisitions in town. so being a public company makes it easier to do larger acquisitions and says something that we'll continue to look agent. >> any areas in particular you're interested in >> anything that helps people work better together so we take a pretty wide view of that. emily: when you look at where the growth is going to come from, is it going to come from adding new customers or elsewhere? >> it's really both. on the former, we look at our business. we have hundreds of millions who e registered for dropbox and 11.9 million substance. we still have a lot of held room among the people who use dropbox o growing so we continue to be

ocused on sub scriber vote and those numbers have gone up over the last couple of years. emily: coming up, we'll break down how quickly the ride-sharing giants is getting through millions this pool -- bloomberg.

emily: while elon musk is making waves trying make tesla private again, there is another tech company where people are amendmenting the opposite. uber. second quarter losses are down loss a year lion ago, $891 million loss now but

revenue growth appears to be slowing. eric, give us a look at the financial picture. >> 2.8 billion. that's still growing significantly. it's 63% up year over year compared to the second quarter of 2016. emily: but points down, rights? >> if you compare q 1 to q 1 with 70%. now we're at 63% so the amount of growth over previous quarters is falling and to make matters worse, uber eats is growing. food gloifers, sort of a money-losing business and that's going to mask some of the slowdown in the rides business overwhelm so not only is revenue growth starting to slow down, it's sart sorts of being covered up by the food business.

emily: how concerning is it that it's slowing down? >> i think uber would argue that it's so big already. uber has already expanded all over the year but clearly they've decided that growth is important to the i. perform o. story, more important than profits so the company is investing in eats, bray, and ellinga autonomous vehicles as the ride business slows down. emily: how much money this company has burned through in its lifetime? >> more than $11 billion. emily: but it still has $7 billion. >> yes, investors have been very kind to uber so it has plenty of money, plenty of cash on hand but spent a phenomenal amount of money over the years and continues to burn many hundreds of millions a quarter.

emily: any outlook as to when that investment will slow down? >> no, he's spoken and at first it seemed like a the i.p.o. maybe peeleded to be profitable and then i've seen him give remarks saying well, not immediately but you need to be on the path to profitable. i don't know if a there's been any guarantee from uber that when it goes private, second half of next year, that it will be profitable. emily: thank you. coming up next, the golden state warriors are teammates off the court but tech rivals off it. more of that exclusive interview with iguodala. ♪

emily: amazon has decided to aggressively use on switch to take on its video rival. amazon is pursuing exclusive

live streaming deals with dozens of popular media companies and personalities. twitch is offering minimum guarantees of as much as a few million dollars a year as well as a share after future ad sales and sub prescription revenue. on the court andre iguodala is an nba star and three-time nba champ. teammates kevin durant and steph curry are also in the game and that can mean healthy competition. iguodala talked with me on the bloomberg players tech summit here in san francisco. >> we share information. there are some deals that i passed on that citi got in and i'm save seeing k.d. do some great things in the deals he's in they've been in a few of the big fudgeds. i look at it as african-american men getting into a space that we

really haven't had much to do with or haven't had much access to. i look at all of those as positives. you know, the players technology summit is going on right now. when you look in that room, you see a lot of diversity, a lot of african-american men. that's something that you look back on, whether you make a,000 x or lose your investment, that's something you look on as a positive and that's the legacy you want to leave behind. emily: a new launch called the future fund to back black athletes and the proceeds will go to boosting black male profit. what's your take on this fund? are you part of it? >> im-- i am not a part of it but i have great relationships with a lot of these guys. chris lyon is a close friend of mine and he's working hard with

that. obviously mark and ben, close with it but for me, i know a lot of people that are within that fund and the hidden g's project is an oakland based prodge where they teach african-american young men how to cold and follow them with the rest of their lives with their colding. we are all-star cold, which is an east coast based group initiative and they're looking to collaborate with other projects. wherever you see our community being embraced and then we take that and give it back to our kids, that's when we start to see change and that's when we start to see our culture being able to be equal. that's quality. given access and having opportunities that we didn't have previously. emily: $15 million for a company that has a $1.5 billion under

management doesn't seem like that much. it's not that big of a fund. could be so much bigger. >> right but it's awareness as well. because it could be bigger but the awareness is, you know, that conversation is actually good. it's not enough so what are we going to do to make it bigger? do we do it on our own? there comes a point in time where it's up to us to do it on our own and you see that with lebron james and the amazing thing we did with the i promise school and how that caused a lot of chatter. kevin durant is doing some with g things with conway track and field facilities for colleges and schools and michael jordan supposedly didn't give enough of a backing of lebron but his jordan brand gives out scholarships to kids every just starting a

conversation and hopefully we'll continue to grow it every year. emily: big season. coming off a big season going into another big season. lebron is going to the lakers. how does that change the game and the season you're walking into? >> it doesn't change much for us except we'll see him a little bit more. i think we'll see him six times before the playoffs. it's been good for basketball. we've been able to build our culture and showcase our community because we have the best fans in basketball but no one was able to see that for a very long time. we're soon to be in the chase center from oracle. we're excited for the next season. we got a big acquisition and we're excited for him to come in and enjoy the game of basketball. keep our fans and consumers excited about the game of

basketball. emily: what is the secret to golden state having so many stars in one place and seemingly to let ng so hard not one outshine the others shall >> i think it's about building the right culture. when you create the right culture, you attract the top cleanl. emily: how do do you that? >> enjoying the game, treating the game the right way, having fun. we really have good people because if you don't fit our culture, we won't allow to you come in and kill the culture or kill the vibe that we've been able to establish and that starts with steph curry. steph curry is as close to perfect as you'll find in a human being so we're always happy for him and his success and what he's been able to build for him and his family and he's taken that on the court and we kind of follow in his footsteps. emily: that was golden state

warrior player andre iguodala. and that does it for this edition of "bloomberg technology." i'm emily chang in san francisco. we'll be back tomorrow. this is bloomberg. ♪

haidi: u.s. stocks have their worst day in seven week as 10 cent and copper slumps into a market. ramy: strong retail sales did little to help as the s&p 500 fell for the fifth time in six days. macy's tumbled and that's despite beating forecasts. haidi: the dollar reeling from the trade war. ramy: and tesla declines for a second day on reports of a