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 im 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 its 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. Im 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 theyre 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 creatives using its product and monetize it. Thats 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 thats 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 creatives 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 etfs 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 youre 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 etfs 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, its 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 etfs 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 its transformational. Caroline its 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 weve 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 blockchains 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 theres 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 thats 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 its globalization, payments and remittance of development. They have their own blockchain called basin there will be a lot of innovation in this industry that hasnt even happened yet. Coinbase is a play on that growth even more so than trading volumes. Caroline its 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 510 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 selfdirected or advisor led. Ive 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. Its 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 . Its 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, were ready for whatever gets served up. Dude, you gotta work on your trash talk. Id rather work on saving for retirement. Or college, since you like to get schooled. Thats a pretty good burn, right . Got him. Good game. Thanks for coming to our clinic, first ones 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 headon class. Its a pivot that hope to take on tencent. The Chinese Government is encouraging ev makers to reduce reliance on western imports to boost chinas semiconductor industry. The u. S. Plan will fund samsungs in texas. Now lets turn our attention to cybersecurity top of mind for executives, you and me as individuals. Microsoft personal secretary security management. There isnt 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 industrys first generative ai product thats 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 microsofts 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. Its easy to get lost in investment research. Introducing j. P. Morgan personal advisors. Hey david. Connect with an advisor to create your personalized plan. Lets find the right investments for your goals okay, great. J. P. Morgan wealth management. Her uncles unhappy. Okay, great. Im sensing an underlying issue. Its tmobile. It started when we got him under a new plan. But then they unexpectedly unraveled their price lock guarantee. Which has made him, a bit. Unruly. You called yourself the uncarrier. You sing about price lock on those commercials. The price lock, the price lock. So, if you could change the price, change the name its 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 unexperience this whole session. Okay, thats uncalled for. Caroline welcome back to Bloomberg Technology i am Caroline Hyde in new york. Lets 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 theyve 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. Im looking at whats 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. Lets talk about broadly what weve seen with tiktok in china. Weve 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 dont think thats a Security Risk or you can be blackmailed by agents of the Chinese Government. You dont understand the unfortunate world we live in. Caroline thats a senator who wants lets 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. Thats 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 . Thats 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 dont 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 . Its an interesting shortlist. They put u. S. Business at 2030,000,000,000. 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. Lets talk to the legal implications of any potential bad or divestment of tiktok. Diniz greenberg at the Electronic Frontier foundation defensive liberties. Was bee