tv Bloomberg Technology Bloomberg July 5, 2019 11:00pm-12:00am EDT
♪ taylor: i'm taylor riggs in for emily chang. this is "bloomberg technology." a u.s. job surprise as america celebrates its birthday. we will tell you how the tech sector is faring. plus, the global demand slowdown hits samsung. the biggest producer of smartphones. what does this signal for the rest of the industry?
and school just ended, but amazon wants parents thinking already about back-to-school shopping. how prime day might now start this unofficial season. but first our top story. u.s. employers sharply stepped up hiring in june, adding 224,000 jobs. while companies faced the uncertainty of trade tensions and inflation remains below the fed's goal, the hiring gains in june provide a solid backdrop for consumer spending. employment within the u.s. technology sector increased by more than 56,000 jobs during the first six months of 2019. this is according to analysis by a technology industry association. the unemployment rate for i.t. occupations, 1.5%, compared to the overall unemployment rate of 3.7%. joining me now, the ceo of a private investment firm, and bloomberg's max chafkin's.
nadine, let me start with you. these are very good numbers. 1.5% unemployment within the tech sector. that is lower than the broader average. do you assume that hiring remains robust going forward? nadine: thanks for having me. i think you have to parse what is happening in the tech sector versus the economy overall. people are looking at payroll and jobs data and saying it is a positive number, but underneath that data is the average hours worked, a decline of 0.3%. even if you have a number of people employed growing, if they are working less hours, unless there are productivity gains, that doesn't read very well for the economy. taylor: what tech improvements would you be looking for? nadine: you would want to see capex spend going up.
unfortunately you are seeing it going down. inventory numbers are looking high right now and that is not a good thing when you are looking for companies to be spending, to be adding to the capex, which means hiring, additional hours, so that data is not supporting an increase in accelerating growth. taylor: max, nadine mentioned that keyword, inventory. as we push forward to earnings season, a lot of this does come down to inventory on the balance sheet. what are you looking for as we hit tech earnings that are coming up through the bottom of this? max: the thing that is happening right now is you have a lot of big tech companies doing very well for the last few years. that is reflected in the jobs data you are talking about.
the question is, a lot of these companies are really dependent on china. we don't yet know how that is going to shake out. that is going to play a huge factor for a company like apple. besides that, there is a sense, as nadine was saying, there's been a lot of profit, but we haven't seen new products coming out. how much further can apple, facebook, google go before sort of reality starts to catch up with them? nadine: max and i were just talking about it. there is a table that shows earning estimates. they are supposed to be down 11% for revenues this quarter and in the high 20's for not just the top line, but the bottom line. that does not bode well for earnings season. taylor: you can cut me off as long as you follow up with a promotion for the bloomberg terminal.
i'll give you a pass on that one. follow up with me on a more serious note about china trade. we are not quite sure where the china trade negotiations are going. how much of china trade is now behind us, or do we think there more of a headwind going forward? nadine: statistics show that the market went up, the infotech sector went up, because of hopes on that china trade being negotiated. but it was pretty much a nothing burger a few weeks ago. it basically prolongs the time that people are looking for resolution. whether it is soundbites or news cycles, the chinese are playing
in dynasties. they are thinking ahead, not just 2020, but 2030, building roads and infrastructure in other countries. we are a little misguided, hoping there is a trade truce,, a solution in the next few months. taylor: max, news this week was broadcom in conversations to take over symantec. analysts are agreeing and disagreeing about the value of that, but the underlying theme is the push for software. as we look at m&a, is it about the push into software? max: one drag on hardware is china. a lot of these hardware companies are manufacturing in asia. any global economic uncertainty is a factor there. these kind of software service companies, it has become a hugely lucrative business. we've seen microsoft go from being seen as an also ran to being the most valuable company in the world on this software as
a service business. certainly, software is going to be a big focus, even companies like apple that have been historically focused on hardware. taylor: nadine, as we saw the news about broadcom looking into symantec, their bid for qualcomm was squashed. how much of the scrutiny over national security and foreign investments is now a headwind for future m&a deals as well? nadine: you point out a good fact. there's a lack of resolution of how m&a is going to get played out. another headline is about amazon and deliveroo. no one really knows the specifics around it. as trade and tech get
interwoven, i think it is going to be difficult to say you can directly play in the m&a game and know how it is going to turn out for companies. broadcom is going to try to leverage the deal over three times net debt, which is kind of a concerning trend with tech companies. taylor: if you look at leverage on the balance sheet, fold that over into the recent ipo's, for some of these investors to cash out, max, as you look at what has been a good year for ipo's, how does the pipeline look? max: there has been this kind of long wait, a bunch of companies raising huge amounts of venture capital, that then were obviously going to go public. there are companies still that haven't done that yet. palantir would be an example. we work would be an example. you can look at something like softbank and see a bunch of companies that have raised billions of dollars and are
going to go public. it is hard to imagine it will be quite as exciting as it has been. taylor: thank you. that was max chafkin and nadine terman. you will be sticking with me. coming up, competition in the food delivery space. we will talk about growth in the sector and how amazon is looking to swipe up one of europe's biggest delivery companies. and if you like bloomberg news, check us out on radio, the bloomberg app, and in the u.s. on sirius xm. this is bloomberg. ♪
running shoes delivering noodles. it might sound ridiculous, but stick with me. chief executive dara khosrowshahi says elderly are signing up to be uber couriers. while most workers use a bike or scooter, seniors and surge of exercise are doing deliveries on foot. sticking with food delivery, the battle among uber grubhub, and postmates for a share in the u.s. market is likely to intensify in 2019 and 2020. food sales in third-party marketplaces might reach $38.5 billion in 2019 with around 40% of order volume still off-line. still with me is nadine terman. nadine, when i was taking a look at this, the firm that caught my
eye was uber eats. walk me through how uber eats fits into uber's growth plan. nadine: it is not their main focus. if you ever sat in uber, ask how many drivers you are with want to and do deliver food. probably 99% of drivers you talk to don't deliver food. i think as uber is now public and they have to have profits, we have to figure out what type of capital they are going to invest, and can they give away free delivery? that along with door dash has been a key driver, but you can't give away business forever. taylor: talk to me about grubhub. that caught my eye. it has the highest customer satisfaction. why? nadine: they've been in the business a long time.
when you look at grubhub, they spend a lot of time in capital on making their customers happy and that is very important. separate from their cost structure, investors penalize them because they were investing in their business. we tend to prefer companies that have the opportunity to invest in their business and on a high incremental margin basis, so i think it is circular when you ask why they have high customer service. taylor: what is also interesting, we talk about customer loyalty. within this base, you say about 80% of customers are retained. why are customers so loyal? nadine: i think you have to break it down to a few areas. they are really taking market share from pizza delivery as well as other delivery options.
it is a great way -- people are spending time on the weekends, also off hours, and it is for delivery to. instead of going to the restaurant, the grocery store, it is a very convenient option for people. taylor: talk to me about door dash. raising about $530 million. while the fundraising is good, it does not necessarily mean they are profitable. you can't give away things for free forever. how do they start to wean customers off of discounts? nadine: as someone who can switch between different groups, i am sensitive to who has a good deal going on. i think the proof is in the pudding when they actually have to make profits, bring delivery charge. we are going to see what type of cost structure they have. they've been doing rounds on an
increasingly frequent basis. i think the last round was maybe a $12 billion valuation. i think that is going to get people to say, is it a priority for these companies, and what is their way to make money? taylor: all eyes on that valuation of this. nadine terman,, thank you for joining me. samsung is the latest tech company to feel the effects of the trade fight. how a global economic slowdown is weighing on the smartphone maker, next. this is bloomberg. ♪
unspecified one-time gain in its display business. samsung's chip business, the biggest driver of profits, remains vulnerable with smartphone demand waning. joining me to discuss is ian king. great to have you. walk me through the prophet miss. broad-based or one-off factor? ian: it is broad-based. this is a preliminary announcement. they are just getting the top line numbers. we will have to wait until we get divisional progress. in general, they've gone out and said, we are seeing what everybody else is seeing. the numbers are bad, but not surprising. the trade war is weighing on everything. taylor: like you said, these are preliminary numbers.
what does it bode now for when we get the real numbers at the end of the month? ian: it is not great. the biggest concern/hope is that samsung's memory chip business, which is where it is dominant, was going to bottom at a higher level. they and other chipmakers have said, things aren't going to be as bad as they used to be in the past. the market is much more rational now. what we are seeing now is that while that may be the case, demand is going lower than people have projected. this kind of inventory boom hasn't really paid off in terms of pricing. taylor: within the inventory dynamics, a lot a lot of this comes down to the pricing of memory chips. can you assume any recovery for the pricing of those memory chips? ian: that had been the promise, that things were bad in the first half, large data center customers, and because we
haven't built new factories, things will get better in the second half. what that outlook did not factor in was that fundamentally demand for things like smart phones, computers, might not pick up and might not help out. taylor: and with the weakness in demand, i wonder about the readthrough when you talk about the mobile phones business. can we glean anything from the weakness in samsung over to apple? ian: there's some speculation by analysts that the big one time payment that samsung got that helped out on its profit line might be an indicator that one of its big numbers like apple or
huawei may not have been able to meet their contractual obligations and was forced to pay themselves out of not taking more screens than they needed to do so. if that is the case, that is a bad sign. we only have speculation as to who that is. taylor: we will await the real numbers. more official numbers at the end of the month. that was bloomberg's ian king. the korean company has completed a redesign of its delayed galaxy fold smartphone. several publications including bloomberg reported screen malfunctions with test versions. while a release date has yet to be announced, the phone is expected to be the world's first mass-produced foldable smartphone and could help the company revive itself. bloomberg explains how devices like the fold could be the next growth driver for smartphones. >> many don't remember life before them. there are an estimated 3 billion smartphone users worldwide.
we've seen phone get larger, faster, and loaded with more features like fingerprint technology, improved cameras, and digital assistants. but the pace is slowing and phone sales are declining. manufacturers are trying to find new ways to come up with excitement. in 2007, apple's iphone ushered in the modern era of the smartphone. at the time, text messages and slow data were about all most wireless networks could handle. then carriers moved to 4g. download speeds got faster, phones got more sophisticated, and growth exploded. 2017 saw the first contraction. the trend continued into 2018. devices aren't making the big innovative leaps they used to. phones are getting more durable. some of the biggest markets are
reaching saturation. so what will be the next growth driver? some of the world's biggest smartphone makers seem to think it will be the foldable screen, which doubles the size of the display without making the phone gigantic. samsung and huawei are betting on it. but the technology isn't quite there. in april samsung had to delay the launch of its foldable phone after some early users reported that it failed after only a few days of use. the screen stopped working after people peeled off a special film that looked like a screen protector. >> it was a pretty devastating blow so early in the process. what was unique is that it folded inwards like a book, whereas huawei brought out a foldable phone that folded outwards. what that means is it is not so much of a crease down the middle as you have on the samsung phone.
while companies are experimenting with how to design these devices, they might start going more for the huawei option. >> may be the game changer will be 5g, though its rollout could be slowed. 5g promised to be so fast that it will only take a few seconds to download a feature-length movie. huawei also has one in the works. >> what it will also do is support other technologies. the driverless cars, the world is counting on the capacity for wireless networks to carry that data. the internet of things, which allows you to connect your fridge to the internet or remote-control the lights in your house, that requires a lot of data. >> experience has shown that it usually takes more than one improvement to get people to shell out for an upgrade. >> when we went to 4g, it was a combination of things. the ability to download the data
made all the extra uses possible, but not everyone used their phone the same way. what you need is the capacity for people to start using their phones in new and different ways to justify spending more money. taylor: coming up, chinese telecom giant huawei continues to fight president trump's efforts to ban them in the u.s.. we will discuss, next. ♪
♪ taylor: this is "bloomberg technology." i'm taylor riggs in new york. if the u.s. and china come to a trade deal, china has one trade condition which is lift all tariffs. here is what the ministry of commerce spokesman said on thursday. >> the china-u.s. trade conflict started with the u.s. imposing unilateral tariffs on imports from china. if both teams are to reach an agreement, the tariffs must be totally canceled. china's attitude is clear and consistent. taylor: larry kudlow told bloomberg on friday there is still a chance for in person
talks to resume. mr. kudlow: they are on the phone, the leaders, the senior people on both sides. ambassador lighthizer, secretary mnuchin for the usa. they have been on the phone, they will be on the phone this coming week. i think a face-to-face meeting is in the cards. i don't want to get ahead of that story. taylor: to discuss is isaac stone fish, senior fellow at the asia society. great to have you here. walk me through the logic because a week ago, coming out of the g20, we were feeling optimistic, yet something changed. where do we stand? isaac: it is hard to know from the comments we just heard if they actually think that is realistic but where we are today is that we still have a pretty large hole between what the u.s. wants and china wants. it is unclear if the u.s. is going to release, reduce some of these tariffs or we are going to
see this loggerheads continue. taylor: removing all tariffs seems like a nonstarter, right? isaac: it really does. in order for trump to say, hey, i'm removing all of these tariffs and in that same sense i have a deal. it is a massive deal. that is really verifiable. a lot of the issues with what beijing has been promising to do is it is easy to imagine a scenario where a deal is signed and beijing goes back to old behavior that the u.s. finds problematic. taylor: i want to bring in sarah mcgregor. from where you stand, what has been the trump administration's reaction? like i was talking to earlier with isaac, we came out of the g20 feeling pretty good. what happened? sarah: we are hearing from them repeatedly. they think the talks are moving forward. they said today, robert
lighthizer and steven mnuchin are meeting by phone with their chinese counterpart and continuing to talk. we don't know the substance of these talks. what are they actually talking about that is different from before with the talks collapsed over the issues you were discussing? china wants the existing tariffs to be removed. that married with u.s. demands that china makes hard-core reforms like the removal of state subsidies and codifying into laws like ip theft, cracking down on it -- two things china does not want to do and would never agree to. where are they going to find this middleground? i think that is the biggest question that is out there from these talks. trump and xi said let's keep working towards a deal, but how will they do that? taylor: we now bring in huawei. what was interesting is it look like we were going to do a full ban, and then a lot of the chipmakers in the u.s. said, no, we want more targeted bans. what is your path forward?
what is your view of the path forward, whether it be a full ban or more specific ban? isaac: i think trump has hinted that huawei is on the negotiating table. as part of the deal, the u.s. could lift the restrictions it has on huawei. what is important to point out is two things in our understanding of huawei. one is huawei, like every other major communications giant, has strong links to the military. that is just a fact. the problem with huawei is that huawei is dishonest about those legs. it is unwilling to admit it still has links with the pla, the army of the chinese communist party. because of where trade tensions are and because of the opacity and the worrying nature of the pla, this is a bigger deal than say b.t. or verizon or other companies that have links to the military. we are in a time where the norms are shifting and it is difficult
to know where things are going to land. taylor: sarah, you hear isaac say huawei is dishonest. that is what the trump administration has been pounding their head against the table for for the past year. the problem is the business community, the chipmakers, lobbyists do not necessarily agree with that. what is their reaction to comments from the trump administration and those we keep hearing that huawei is really tied to the government? sarah: we start even with this ban that the trump administration put on huawei that essentially cut off american suppliers to that company. first thing they were doing were hiring their lawyers, trying to find ways around this ban so they can still sell their products to huawei.
it is a huge company. it controls about a fifth of the telecommunications market in the world. for u.s. suppliers to be cut off would be pretty detrimental to even some u.s. businesses. they take that from more of a business point of view. trump is really muddying the message about huawei. he was in europe and suggested to some governments there perhaps he would not cut off intelligence sharing with them if they dealt with huawei. he's eased up on this ban, as well as zte. it seems like when it serves his interests, trade interests or rebuilding relationships, he's willing to go easier and not take that hard stance on them being a national security threat. i think that is where things get unclear and companies like huawei are going to see an opening to try to pressure trump to get what they need. taylor: isaac, with your experience and deep understanding of how china operates, how china negotiates, how the u.s. and the trump administration has used their paths, what is the best negotiating path forward? isaac: i think we have to be open to the fact there might not
actually be a deal. we might not see a scenario over the next year or several years with the u.s. and china come to the negotiating table and leave with a signed agreement that really changes the problems the two countries have with each other. we are in a new normal here. regardless of the bluster that trump brings to the table and the bluster a lot of the chinese leaders bring to the table about what their needs and desires are, it could be there is no optimal middleground and the way this looks going forward is a continuation of where we are today. taylor: would you agree that chinese tech sector has been hit harder than the u.s. tech sector amidst all the trade negotiations? isaac: i would. taylor: we will leave it there. isaac stone fish and sarah mcgregor, thank you both. coming up, if your kid has to have that trapper keeper for school next year, amazon wants to make sure you are shopping
♪ taylor: amazon has asked for u.s. permission to launch more than 3200 communication satellites. the company is joining a new space race to offer internet service from low orbit and challenge the plan by spacex. in a filing with the fcc, it will deliver broadband to tens of millions of consumers that now lack adequate access to the internet. the agency has approved nearly 13,000 low-earth orbit satellites. school is out for the summer, but there was no more waiting until august for those back-to-school deals. amazon wants to make sure
parents are buying binders and crayons now -- well technically, july 15, prime day. to tell us more about this push to get parents shopping right now is our bloomberg retail reporter jordyn holman. walk me through -- this is killing me. at first, when we were talking about christmas season that begins in thanksgiving, now we are talking about back-to-school season that begins in july? jordyn: schoolchildren just got out of school maybe last week or two weeks ago and parents have already have to start thinking about where they will buy their back-to-school clothing and supplies. amazon, with their amazon prime day in its fifth year, has kind of moved up the calendar for back-to-school because they are offering these discounts and all these retailers want to get in on that game and offer discounts to not parents are saying we should by now. taylor: does this mean people actually spend more because it is spread out over a longer time, have more time to budget
and plan? jordyn: that is what is happening. back-to-school spending has gone up 9%, expected to go up 9% this year. so on average, american parents are spending over $1000. even though the shopping season starts in july, that does not people will not walk into walmart and target by labor day. it means that calendar is so much longer now. taylor: how much discounting are those brick-and-mortar stores having to do to compete with amazon? we always talk about the amazon effect. are they having to discount more heavily? jordyn: when amazon started their prime day, only about seven retailers were discounting to keep up with them. this year, there will be 250. they're either having to go item to item or just offering discounts on other items that amazon is not. people are looking for the best deal and not necessarily it's
prime day, let me get something. taylor: what is crazy to me is i remember back-to-school shopping with my mom, you go into a store, pick out all the binders and backpacks. now it seems like you can do a lot of this online. how is the composition of the shopping changed from brick-and-mortar to online? jordyn: e-commerce back-to-school shopping has gone up significantly. people are having a larger percentage of their back-to-school shopping beyond e-commerce. retailers are saying prime day, this july 15 holiday, is now one of the most important parts of the back-to-school shopping. they are making sure they are coming out with these discounts, they are marketing to the e-commerce world because they don't know if people will wait that long. taylor: are more people still shopping in-store, it is just losing ground at a quicker rate to e-commerce? jordyn: the majority of parents are still walking to brick-and-mortar stores, but now people are more interested. they are going online checking things out and that might end up in a sale.
taylor: talk to me about the composition. like i said earlier, it is matching the backpack with the binder, etc. how has it changed between what you are actually buying online? are you buying more backpacks, binders, crayons? how has that changed? jordyn: people feel comfortable buying these crayons, backpacks, electronics. but clothing is still one of those items people want to try on so that might not have the amazon effect. kids grow quickly so you might want to wait closer. with a items of the binders, the markers, all of those things you don't need to see, people are going to shop online. taylor: every time amazon enters the market, people get nervous. we call it the amazon effect. to be fair, these brick-and-mortar companies have done a very good job -- target, walmart -- of adapting. even when amazon came to the
grocery business, walmart stepped up their game with online grocery delivery. what can be said about these brick-and-mortar companies adapting and still hold onto their market share? jordyn: it says they still want to be in the game. they realize the game has kind of changed. their calculations have changed. but, when people think of going places -- you want to walk in, see things, have that excitement. the walmarts and targets of the world have able to maintain that excitement around back-to-school. prime day is not a real holiday. they are just competing on a fake holiday but they can also play that game too and manufacture some fun discounting days as well. taylor: we are in a whole new world when it is july 5 and we are talking about back-to-school. i just got my summer started. that was jordyn holman. if you missed the boston pops july 4 fireworks spectacular, here's a taste of the celebration.
>> boston! >> usa! >> all of us at bloomberg are so happy to be back. >> it is our third year with the boston pops fireworks spectacular. >> happy fourth of july! [cheering] >> happy independence day! >> you told me that this is your first time to the boston pops fireworks spectacular. >> yes, it is the first time. >> what do you think? >> it is awesome. >> it is an honor to be here with the pops to celebrate america's birthday. as a daughter of dominican parents, i feel so proud to represent the latino community. >> we are going to be playing your song tonight from the air force. are you ready? >> i sure am. >> the message of tonight is that liberty is something we are all entitled to. liberty is for everyone, not just a few. >> i am already starting my
countdown to next year to rejoin my musical family on stage. my boston family out there in the city. and my american family, really, my american global family. it is so much fun. ♪ taylor: still ahead, bitcoin has been swinging wildly over the last few weeks amid facebook's crypto news. will the bubble burst again? we will discuss all things crypto, next. this is bloomberg. ♪
finance company circle, jeremy allaire, about the current landscape. jeremy: i think the announcement of libra and the libra association -- we view it as a very massive inflection point and i think it has an impact across the board. first, just general awareness all around the world around cryptocurrency. it will bring this into the limelight it will help individuals and businesses that are interested in this have dramatically more visibility. ultimately, we think it will help ensure billions of people ultimately are able to access the benefits of cryptocurrency within the financial system. so, we think it is huge in terms of awareness. i think it is important in terms of ultimately regulatory questions and figuring out exactly how crypto finance companies are going to work in this new realm. romaine: what about the logistics of getting it done? when do you think we will actually see this?
do you think this would have been a better idea logistically speaking if it had come other than facebook? jeremy: i think -- the first thing to realize is that blockchain, public blockchains that are capable of supporting hundreds of millions to billions of users with kind of mainstream applications and finance, those are really just emerging. we went through the first generation of blockchains with bitcoin. many would say similar chains represent the second-generation of blockchains. those today support tens of millions of users and growing. there has been this effort all around the world by computer scientists and designers and economists to design the third-generation blockchain which could provide the features and scalability needed to blanket the world with the benefits of crypto. the project that facebook is introducing with a number of other companies is just one take
at that but nothing only take. i think the consortium model is the right model around any kind of new technical standards that we are trying to seek develop in crypto finance. joe: you said a couple of times the benefits of crypto. one of the benefits of crypto a lot of people would tell you is decentralization, free transactions. being able to buy anything without any middlemen saying you cannot do that. circle has its own stable coin. facebook's is going to be regulated. what is the benefit of a crypto that does not really offer that center to free transactions because it has to go through on some level or interface with existing financial system? jeremy: we look at all of this kind of on a spectrum. our view is that you are going to have mass adoption of nonsovereign, kind of digital
assets. bitcoin is the preeminent asset there. the need and desire for those kinds of assets is going to grow, not diminish. you are also going to see growth in these stable coin assets that are very likely going to have regulatory frameworks around them, but there is a really key difference between stable coins that run on kind of closed loop, permission schemes which is how libra is being proposed today, versus stable coins that can run on the public internet. that is really the model that coinbase and circle have developed together. that is how u.s. dollar coin is growing today. there really are some variances in how people are going to be implementing these different types of currency models. romaine: so, when you talk about the regulations, particularly on creating national policy and potentially some sort of integrated international policy,
how do we get there in this environment, particulate when there are a lot of concerns about security, about concentration of ownership of bitcoin, and a lot of speculation on whether there is market manipulation? jeremy: yeah, i think these have all been topics that have been explored and now i think there is more attention on it. the policy issues range from what are the standards for things like protecting, you know, from the abuse by criminals or financial crimes type risk? or what are the risks associated with the theft of digital assets, the custody of these types of digital assets by intermediaries? we have not seen any rules around that in any broad-based sense. finally and probably most importantly is a lot of the exciting uses of crypto are in innovations and how people raise capital and how people create financial contracts using this. the standardization of the
financial instrument side of this. there is a huge amount of work that needs to be done still. there has been regulation by enforcement or regulation at an ad hoc basis. what we have been advocating for and we hope the introduction of libra brings this forward is the development of national policy around digital assets. our view is that crypto and blockchains represent the fabric of the 21st century economy. there is an opportunity to put in place policy that allows this to flourish on a massive scale in the same way the internet flourished in the mid-to-late 1990's and policy was really vital to enabling that to happen. so far, policy has been focused on the risks. what we really need to be focused on is, yes, we need to manage risk but how do we open this up so far more companies can benefit from it? hopefully, we will see more of that in the coming years. joe: real quickly, what is the dominant use case currently for
your stable coin, the usd coin? jeremy: u.s. dollar coin, we introduced it in q4 of last year. it is, as you noted, a dollar back cryptocurrency. the primary use today is a payment method within the digital asset markets. these multibillion-dollar markets that exist all around the world where people are trading, investing in digital assets. having a dollar that can move at the speed of the internet, that can move at an incredibly low cost and the transaction can be settled with a counterparty in minutes securely is really powerful, especially when trying to operate in that marketplace. that has been the primary use case. we believe the uses of this will really proliferate to the point where payments and moving values, and people are using these to access a broad range of financial products from their
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