A Better Twitter Deal and Terra's Collapse

over how viable this takeover actually is. Plus billions wiped out in Terra USD in that crash, why can we learn from it? What does it mean for the future of stable coins. We'll discuss all of this and more with John Woo from Eva Labs and while Doctor Strange in the multiverse of Madness, it talk box office record here for the second straight week our movie theaters back. Are there still head winds ahead? More on that later

this hour. But of course, and we cannot go on for at least two minutes into this show without talking about the latest drama between Elon Musk and of course his takeover and the proposed takeover of Twitter. Really interesting comments coming out of Elon Musk today hinting that he might want to renegotiate the deal at a lower price, saying that it quote wouldn't be out of the question.

And these latest comments, of course coming from Elon Musk via a video conference at a summit over down in Miami, and it was hosted by a podcast called all In for more on these comments, of course, where the deal stands. I'm so pleased to be joined here by our very own mandage seeing of course over from Bloomberg Intelligence and

Kurt Wagner joining us from Bloomberg News. Kurt, can I just start with you from someone who's been following and covering this company and of course Elon Musk and solve, how do you think just sort of the way that this has played out in the drama that it's putting really on the company too? I Mean, doesn't this just feel like the mos Twitter thing of all time to happen? Right?

It's just, uh, this deal that just continues to be a roller coaster um and the fact that we now have Ellen kind of coming out today and suggesting, Hey, I might be you know, interested in negotiating a lower price for this deal, even though I just offered something else a few weeks ago. It just all feels like this is kind of cascading in a negative way for Twitter.

I always have said that the worst case scenario for them would be that this deal falls apart and they're kind of left standing there without anybody to come acquire them, And it feels like that's becoming more and more likely every day. And man, Deep, let me bring you in on that, because, similar to what we just heard from Kurt, I was hearing from Dan Eves over a web butch earlier saying again, serve this worst case scenario, they're going

to be left at the altar alone. Right. How do you think about the lack of no bidders and is this Elong's way of negotiating down in price. I do think, you know, he doesn't have a way out of paying that billion dollars and breakup termin NTIONC in case he wants to walk away. But at the same time, the odds of the deal happening are higher than they were

probably three weeks back when the deal was announced. And the reason I say that is because at least he has six point five billion in commitments from you know, co partners, and what he really wants to do here is to you know, move away from that margin loan. So right now he doesn't have about you know, trolls to thirty billion dollars in financing. He has already sailed a bunch of sold a bunch of stock, so that's

about you know, eleven billion. He's got six point five billion in commitments, so it really wants to move away from that troll flowing five billion margin loan. And that is what I think he's looking to renegotiate here to bring that price flaw. Very interesting and Curt, I think at the heart of this issue comes down to the percent of users that are represented by bods when you think about Twitter, whether that number is five or relative to meta, snap TikTok, I mean sort of the other

social media covers companies that you cover. How does that bought relationship fit into this narrative. Yeah, he talked a lot about that today. He was at a conference in Miami. Are Bloomberg reporters. My colleagues were not at the conference, but we're able to listen in to the conference as it was happening, and he brought this up. You know,

he was saying, Hey, this is an issue. Um, I don't believe that the bots are less than five percent of the total user base, which is what Twitter says, and earnings and there are and Facebook says something similar. To be clear, this is not a unique situation for Twitter, um, but Ellen has had an issue with bots. He has made it part of his kind of campaign of how he's going to clean up the service and what he's going to do to change Twitter. And he's saying he

believes it's to be a lot higher. And we saw CEO Parague Augura Wall from Twitter kind of going back and forth with Ellen today trying to explain, Hey, here's how we measure bots, and Elon replied with a poop emoji. Right. He clearly was not int listed in Auger Wall's explanation here, and I think that's a big sign as to why he's, you know, saying this is on hold. He wants more answers. You're not allowed to use that emoji with me, Kurt, Neither is Mandy. Never. I would never do that, Mandy.

You've been commenting on this. Similarly, you take a look at the bottom up analysis of these companies, the actual fundamentals user growth, revenue growth, profitability, How, MANDYEP do you think about the percentage of boughts at the impact on the health of this company all. So clearly it's a bigger problem with Twitter. And when you take out let's say five of the users are bought, so the e v per user goes up that Elon is paying with

this deal. And when you look at a complex Snapchat or Pinterest right now, the e v per user is close to a hundred dollars there, as with the four billion deal, it comes down to around two hundred dollars for Twitter. And look, could have had this problem of you know, basically exaggerating their user numbers and they had to, uh enough, come out and say that the actually using

numbers are lowers. So it's not a new problem. But clearly, if you're valuing a company based on the total number of users, then you have to think about, you know, revising the price lower because the actual number of users are lawer Amand it just a follow to you on this. I think we're having a broader discussion, and this broader discussion is underway about if that price target set a

floor for how we think about valuing these companies. And the broader market is telling you, at least today in the last few weeks, we're rethinking valuations on every level, not just because yields are higher on the discount rate falls, but the big valuations of growth at any cost. How then sort of is this played out in the also thinking about the way that we're valuing these companies and these tech companies. Well, so clearly, you know, social media

companies aren't really growth companies anymore. If you have to think about you know, growth, really it has to the next leg all social media would be more on the meta word side right now. Valuation have gone down everywhere, But I think Twitter isn't a high growth company anymore. Yes, it can sustain it EBITDA, but we're not talking about

forty growth even if it goes private. So that is where you know, you have to really think about which is actually growth going forward as opposed to what can generate pre cash flow to pay off the you know, interest payment and current come back in here, I think as you think about pushing this story forward, what do you want to see next? What are you looking for if what can we do private that we couldn't do public? What do you want to see in terms of leadership?

What are you really looking for to understand if this company really can turn it around. Well, I think the best way to grow the business is not going to be to abandon advertising altogether, which is what it feels like. Ellen, what kind of wants to do? He's talked about a subscription product. I think that's fine, but really I think what you need to do if your Twitters, you need to figure out how to get the kind of user data that works with targeted ads, that works with direct

response ads, right. That is what Facebook and Google do really well. It's something that Twitter has always struggled with. They already have an ad business, They have advertisers who are interested. They just need more granular data in order to do that direct response type stuff. And now it's easier said than done. But I think that's the one thing that if they can figure that out, I think

the business could really benefit from that. Mandy, do you agree, Well, clearly, I think subscriptions is part of the story here, and but we've seen subscription businesses aren't easy. Look at Netflix. You know Netflix is moving into adds. Do you really need a combination of ads and subscriptions? Moving away completely from ads would be a mistake. Really appreciate that both

of you great insight fundamental analysis. So appreciate the conversation Mandy seeing of course, and our very Kurt Wagner out there in our beautiful San Francisco office. We want to talk now about a new social media law out of Texas that has many in the tech world fearful of what might be allowed to flow on your feed all

in the name of censorship. Groups representing Twitter, Facebook, and YouTube warned the Supreme Court that unless this Texas law is blocked, anything from Russia propaganda as well as neo Nazi post denying the Holocaust could show up. Insiders of course now warning that these extremest views could cause social media companies to lose millions in advertising for more. I'm joined back Techonomy founder David Kirkpatrick, who thankfully you've been sort of all over this and I am curious to

think about. I believe a Supreme board who can decide what cases they want to hear and what cases they want to rule on. What at the heart of this issue really is going on for some of these tech companies, Well,

thanks Taylor. Basically, what the tech industry is asking the Supreme Court to rule that a tech that a federal appeals courts ruling last week which allowed this law to take effect, was it must be removed and vacated because the impact that it would have on tech companies is so extreme that it would almost make it impossible to operate any kind of website where there is conversation if

that site has more than fifty million users. It's a truly inane, idiotic and illogical and crazy effort to change the rules for what seems to be just partisan advantage. It talks us about the advertising, of course, that we mentioned in the introduction. The companies, of course benefit from the advertising. What would stop sort of that flow of advertising? In your opinion, well, that's a great question, because obviously advertisers only want to appear in an environment that's rational

and makes their products look good in contexts. If if websites are prevented from taking down any kind of extreme statement by any user, it could really make these sites much less kind of culturable for advertising, and I could see it having an effect, although the problem is even more basic than that. Essentially, the companies are being told by this Texas law, if it were to really take effect, that they can't make any real decision about what kind

of contact flows. Content flows across their own networks. But these are commercial companies who built these commercial websites for commercial reasons. They have every right under the Constitution to operate their sites as they see fit, and this law attempts to remove that right from them, which is just plain wrong and and on constitution clear, Let's talk about

something else I'm reading here in your notes. It really speaks out to me that it allows people to also sue these companies as well if they're censored for their viewpoints. How does this sort of open up and I know that we're not lawyers here to sort of open the floodgates for these potential lawsuits as well. And then the impact that has on businesses and consumers. Well, there's so many crazy aspects to this law, but one way to think about it is that that companies wouldn't be able

to do well no matter what they did. They would be damned if they do and damned if they don't, because the law allows anyone who's viewpoint, which is the term they use, has been used as a basis for removing their content, to sue the company. Okay, however, if those viewpoints are hateful, racist, uh, show some kind of libel or whatever. They will then probably which they're but

they're prohibited from taking them down. Remember, people who are affected by those posts will almost certainly then sue the sites because they are being affected by these posts that have not been removed. So in effect, the sites can't win either way. It just underscores yet again how fundamentally

illogical the law is. But it's worth remembering. It seems like the whole point of these laws, and there was an attempt at a similar law in Florida, is to get back at the website, particularly Facebook, YouTube, Twitter, etcetera, because they're perceived to have an anti conservative bias. And the conservative majority in the Texas legislature has passed this

law and the conservative Texas governor has signed it. But the fact is it simply cannot work, and it's it's being done for pure political partisanship and and and without enough thought. David, it's interesting you mentioned Meta of course

formerly we knew that as Facebook, you mentioned YouTube. We're talking a lot about Twitter of course right now when in the sitegeist with Elon Musk of course stepping in and giving a price potentially to take private of all the companies you've been studying for decades over the years, who would be most impacted and who is most susceptible

to getting a hit? Of course from this, well, the law is meant to a li to any company that has fifty million or more users, But it really is intended it's aimed at Facebook and Twitter primarily and YouTube because those are the sites where speech, so to speak, is most frequently taking place, and they do frequently make judgments when pate speech or political incitement or violence is endorsed or whatever to remove posts now, but it would

it could affect any site that has over fifty million users, which could be for example, Netflix or Disney Plus if if there's any kind of content or conversation, well, I guess those are probably not good examples. But any site that has any kind of dialogue, say the Near Times or any kind of Bluebird for that matter, if if the number of users is big enough, there will be no allowance for moderation. In effect, so it's it's taking away a fundamental right for any company that is attempting

to foster a safe and rational conversation online. David, what do you think is you think about sort of the next step pushing the story forward. Do you want to see changes to the fundamental businesses so that this isn't an issue. We we talked a lot about Twitter having its crisis that it's going through right now. What are you really looking for as you look to these companies, Well, there are really big questions, and the reason the situation has arisen does flow in part from the failure of

management by these companies. I don't think that Facebook in particular, or any of the social media companies for the most part, although some extent I'd leave Snap and maybe even TikTok out of this. But certainly Facebook and Twitter have not done as good a job as they should have of articulating what is allowed and what is not allowed and

sticking to very clear standards. From the beginning. They let themselves get into a place where there's a sense of k us and I think part of it was they were trying to placate the Trump administration and didn't want to seem to be anti conservative, and they really allowed a lot. I think they allowed a lot of inappropriate content that was supposedly conservative but was really inciting um.

But now because they took down enough of it that it got the right angry there are legislators all over the country trying to take these rash moves against them, really out of partisan dislike. But I think the long term issue is the companies have to establish clear standards for what is and is not allowed, and communicated clearly

and stick to it. It's very, very hard. I don't think most of these companies anticipated when they got into these businesses how complicated the decisions they'd have to make would become. But that's where they are, and that's just the fact a complicated issue. We're grateful that you're here to give us your expert analysis and insights to Economy founder David Kirkpatrick really appreciate it, and we're going to have more to come, of course, including a report on

the impact of well the China lockdowns. What that means for us, This is Bloomberg. China's economy is paying the price for the government's COVID zero policy, with industrial output and consumer spending sliding into the worst level since the

pandemic began. Our very own Bloomberg Stephen Eagle has more clear sign China's economy contracted sharply in April as continued COVID zero lockdowns hammered industrial and consumer activity nationwide with its too wealthiest cities, though Shanghai and Beijing under COVID restrictions read tails. Sales nationwide plummeted a worse than expected eleven point one percent last month as tens of millions

of people were confined to their homes. Factory output two tanked, falling two point nine percent, the largest and only second year of a year monthly contraction of industrial production in thirty two years. Yes, since n now, the consensus estimate was for a modest rise, but clearly China's industrial might was slowed by the lockdowns and those supply chain issues. China's nationwide jobless rate also taking up to six point

one percent now. Shanghai has been in lockdown for nearly two months, but this week is starting to relax some of the most strict curbs as COVID caseloads and inter community infections start to fall. Now. Beijing has signaled policymakers will step up support for the economy, as evidenced by the PBOC on Sunday, cutting mortgage rates for first time homebuyers.

China's National Bureau of Statistics, also admitting that COVID outbreaks in April had a big impact on the economy, but claims that the negative effect will be short term and that economic activity should start recovering gradually. Still, the economic shocks from she dimpaying zero tolerance approach to virus containment are obvious, pushing China's ambush ambitious full year growth target of around five and a half percent further out of reach.

Stephen Engel, Bloomberg News, Hong Kong are very on Bloomberg Steve Nigle. Now, of course, talking about those supply chains ahead of the port of Los Angeles, cargo flows from China to the busiest port in the US appear consistent despite that ongoing pandemic. Here's some of what Jean Siroka

told Bloomberg. This is gonna take some time. There's an episode just about every day that impacts us in the supply chain, whether it's on the ground, the atrocities in Ukraine impacting energy and agriculture goods flow, the lockdowns in Shanghai, point three percent inflation, producer prices going up eleven All

of this is in the supply chain equation. Soroka says that there are no imminent signs of course of a slowdown in demand from American consumers based on the number of full shipping containers that they are seen arrived in the port. Coming up. We're still on that theme. Inflation, of course, still on the rise, interest rates climbing, tech stocks falling. What's next on the horizon, We have all of that more and next. This is Bloomberg. This is

Bloomberg Technology. I'm Taylor Regg's in New York and for Emily Chang. Let's get an update now on the markets. The sell off, Katie of course still joining us now, Katie Greifeld. It just continues. I mean, we're looking to attack in the NAZAC one hundred often addition a one percent today hard to catch a break. Absolutely, Friday's bounce it came, and it went very quickly, of the SMP five hundred, ending four tenths of percent lower. Big tech

felt even bigger. You have the NASZAC one hundred finishing well one point two percent lower. And that was even as some of the steam came out of treasury yields, the ten year treasury yield falling about four basis points or so on the day. And you have bitcoin it's rally a little bit after hours, a little bit of a nudge. But yesterday or this current day, Monday, it fell over three percent. You can see it's below that

thirty thou dollar per coin mark. And what called my eyes that you actually saw the cbo ET Volatility Index, the VIX. It actually fell a little bit today it's mac below thirty. That's still above its one year average about twenty one, but still a little bit of a breath there today even as you did see that sell off resumed. But the question becomes, I mean, how much

can volatility really fall as stocks continue to fall. If you look year to day, you can see the NAZAC one hundred down about twenty five per cent, so big tech, those growth names really taking the brunt of the selling. The SMP it continues to flirt with that bear market again that is at it's getting closer tailor at about six year today losses. And of course Katie were so excited to have you tomorrow joining us on Bloomberg markets. I can't close from two to five pm. It is

our pleasure, so really appreciate that. Katie gry felt, of course joining us here with more on these markets and then sort of leads us right into our next conversation. We've talked a lot about this sell off. What does it mean for a new round of fundraising? Right when you think about all the belt tightening around the corner, does that cascade into another big problem? Doesn't mean to slow down in enterprise technology spending? Does this drive down

another leg in the industries earnings outlook? Well, if you have earnings, that's the first problem with some of these companies. Be Capital co founder and managing partner Raj Gongly of course joining us here for more. Can we just start big picture when you think about just the pressure of broad based on these valuations, maybe it's risk of recession,

maybe it's rising yield. How are you thinking about portfolios of some of these new companies and well, the pressure now they may not be worth what we thought they were. I think that it's the exact right question that everyone's asking in VC is um what are your company is truly worth? You may have paid something for them six or twelve months ago, but I think where the market is going is actually very healthy. We're resetting to a set of valuations that are going to make more sense

and actually help us build better companies. And while there's going to be some short term pain. I think that eventually you're going to see some of the sectors that are traditionally resilient, like healthcare cybersecurity bounced back first, but we're gonna have to go through a bit of pain, and a path to profitability is going to be one of the most important discussions that everyone is happening. Talk

to me about that. So I remember, I think I was in San Francisco in and we were talking a lot about we work at the time, and it was about growth at any costs no longer works. That any cost has to be reevaluated because we need to see some free cash flow soon and we need to see it sooner rather than later. Is that the same conversation we continue to have now here. You're exactly right. I mean growth at any cost has never worked. Uh, it's I don't think we are dramatically shifting to survival at

any costs. You still want growth, but you want growth at a much more resonable cost um. And what that means is thinking looking at things like the burn rate of the business are going to be really important. I mean, that's things that if you're not a profitable business you've got to be managing or burn during times like this. And frankly, if you're a late stage business that was hoping to IPO, you better have at least eighteen months of runway because IPO markets could take a while to

come back. I've been reading a lot of to sort of the market analysis about how to prepare for a recession if it's conserving capital of even if a recession isn't company coming, how do you plan for it? How do you think about that capital, the balance sheet, the employees, the culture, and making sure that the able around you are appropriate. What should some of these big founders be thinking about when they're trying to manage a business through

this volatility? You know, I think these big founders, that's

where they are because they're great leaders. And I think over the next six, twelve, eighteen months, you're going to see, you know who amongst this group really knows how to manage and management morale is going to be difficult when some of morale was built around if you're a public company, it was built around stocks and stock options, and if your private company was still built around your shares and the valuation in the private market, and now you're gonna

have to motivate employees who primarily were being paid through stock private or public, and motivate them to work harder than potentially they've even ever worked before in a much more challenging environment. I think the great leaders are the ones who are going to do it by telling people that stay focused on our purpose and our mission, and we'll all make it through this together and we'll come

out the other side of better company. We've long often talked about the if you want to use the word bubble, and we don't have to use that word, but a lot of that sort of inflation of the evaluations came from too much capital chasing too few too much cash right, chasing too few companies. How do you think about the deployment of that cash and the best use of cash?

Then at this moment, well since sinceurity went there, and you use the word, what I would say is that, Yeah, what I would say is that, um, you know, cash now is going to be for very core activities. You seem businesses that have gone into a lot of non core activities. I think you're gonna see a retrenchment to the court. You're gonna see companies focus on the regions that really makes sense and already are profitable or have

a shorter path to profitability. And you're going to see more add on businesses that can be launched for much lower cost first things that are far from the core. You know, specifically for us in software, healthcare, and fintech, the three areas that we best. We think healthcare is probably one of the most Brazilian sectors. We're going to continue to invest there, and frankly, for some of our businesses that have a lot of capital, this is the time's play offense and look at how you can acquire

companies for lower valuations. And I think you'll see corporates do that too over the next twelve months. I really appreciate your time, your perspective, your knowledge and insight. Speak Capital co founder and managing partner Gongli thank you. As always, of course, we want to go back to maybe private companies, back to some of the big public companies that we've been following. Microsoft is set to boost employees paychecks in

an effort to combat inflation. The company announced its plans to nearly double its budget for employee salaries and boost the range of stock compensation it gives to some workers. By at least tw This is all in an effort to retain staff. The move said is to mainly affect early to mid career employees, all at the software giants.

And of course, coming up, what is the future of stable coins after the Terro Luna to blackled last week, we'll discuss this bloomberg time now for our crypto report, we have to get back to that meltdown that followed the Terra usc algorithmic stable coins collapse, and total investors may have lost as much as forty two billion dollars in that crush. This is according to Elliptic. Our crypto

contributortional E. Bostick is here with more. And I think my favorite line from Katie Greyfield on Twitter was ust no longer means US treasuries. How the heck is this all about crypti? Yeah, I mean that's a great question, especially because there's a lot of stable coins to keep an eye on, US, d C, Tether and USC is the one we're certainly talking about now because that's the one where the DP pagging has really led to a

lot of losses among the Terra ecosystem investors. And you have Tara now talking about restructuring the plan here so that people can recoup some of their funds potentially or at least start to build on the network and a broad away. But if you look since the initial d pegging, almost nine percent of a decline and ripple effects indeed across the DeFi ecosystem. But let's just take a look at bitcoin itself for a second tailor, because Bitcoin is

of course the largest of cryptocurrencies. We've seen it bounce back quite a bit since the initial fears about the crypto ecosystem that large, and now only down about sixteen percent over the nine day period. We have seven days of gains. We have about three percent worth of losses over twenty four hour period, but again just coming off that low again but still just hovering around thirty's and such a wild swing show. You've been all over it,

so I want you to stick with me here. I want to bring in John Wu of course into this conversation, president of all the Labs of course, lead developer of the Avalanche blockchain, and just big picture to kick us off. I think some of the biggest questions is if it's a stable coin and it's not stable, what is it? How do you think about that. Well, first of all,

there's a couple of types of stable coins. There's ones that are actually backed by US dollar reserves like USDC, and then these algorithmic stable coins like the Terra Luna, which was, you know, an innovative experiment. Unfortunately, we can all say it didn't work out. Um, But in the back of all of our minds, I think every crypto native, web free person really has a hope that someone could

figure out a minetary system or a stable coin. It doesn't rely on existing things that you know, are traditionally out there as reserves. So we all rooted for it. Unfortunately it did not work out. It's still very early in the space and I'm sure there will be more experiments and innovation now. Uh. In terms of the latest restructuring plan, from why I understand, um, they are trying to figure out who are the smaller holders and use whatever is left in reserves to basically give back to

those smaller holders. So that would be my number one thing this point. It is what it is, but use whatever reserves to give back to the retail people that were left holding the bag, if you will, And that's the best thing to do at this point. I want to ask you more about that, John, because what does

it say about the restructuring of crypto ecosystem? Who should get paid, who has claim on the assets at the end of the day, and what does the what does the company, what does the protocol actually owe to its investors? How does this play out? Sure that needs more clarity over time, But to me, at least from a common sense perspective, the this is the one industry where the retail investor have actually call it front run investor institutions.

For years, it's been retail investors globally that's supported this ecosystem until very recently, if you will so Um philosophically, I think again, the right move is to use whatever is left to figure out who are the small bag holders or wallet holders and try to make them whole as much as possible. So what about the idea that other stable coins can be made with new models? You

talked about experimentation here for a second. To what extent does the industry needs something like an algorithmic stable coin or a partial algorithmic stable coin in order to scale, John, So the industry right now does not need it. What's going to come out of this situation is USDC, which has a lot of transparency backed one to one with the US dollar. Wild game market share um USDT was tested a little bit um, but they need to come

out with better transparency and they will do that. And then you have other stable coins, you know, facts, so they've all held up. Actually, so it would be nice to have an algorithm stable coin. But just like any economy, economy needs a certain unit of account for a medium of exchange that is stable and not as volatile, and for now, maybe one that's tied to the US dollar

and has transparency is the best thing. You know. I'm curious about certainty in other ways besides regulatory I'm curious about the technology itself, potential hacks, potential chains, depegging, if it's a stable coin. I'm wondering about your thoughts on Layer one protocols in general year and investor appetite for

them after some of the mishaps we've seen. Great, great question, And if you look at UM the space and the many cycles, let's not confuse cyclical issues with secular growth in times like this this when actually the quality companies or quality protocols or quality applications that actually gain market share and have even more innovation and build better UM.

So my opinion is it's unfortunate. No one likes to see crypto asset prices go down, but the benefit of it is the guys or the people with quality products to have better utility and are really building something real will take market share and also come out stronger and

provide more utility in the end. Also when it comes utility, you know, I know tomorrow in our Crypto show, our weekly Crypto show one thirty every week on Tuesday's, we're gonna be talking about etherory on the merge and gas fees and whether they can come down in light of new projects. I mean, I'm wondering how this also pertains to you and Avalanche and the ability to bring down

gas fees at the end of the day. So, first of all, great show or a DVR that and I watch it all the time, so thank you for putting that on. And in terms of what the merge will be doing, it's really ethereum will get to where Avalanche already is the first part. It will come in stages and the first part for them will be going to proof a stake. But it's still gonna miss out on the instant settlement that Avalanche has or the scalability that

Avalanche has. I mean, just this weekend, the Avalanche plockchain had a scaling function called a subnet, and these gaming companies actually launched on these subnets. Transactions on Avalanche increased twenty five while prices went down like twenty fold. There's more transactions now an Avalanche on the daily basis there are on Ethereum. So with the merge and with all these things that you're trying to improve, there will get to at some point a place where many newer generation

layer ones are already at such as Avalanche. I should say the show also is at one pm. My bad, John, but thank you so much. We also um the speaking of Avalanche and the ability to kind of make it through this down market. I'm wondering from your perspective, as things are kind of cooling down in the crypto market, what do you take this time to do? Take this

time to focus again? The ones is similar to the segment previous when you had the venture capital sign the good companies that have a good call it balance sheet, they have the ability now to gain share and to continue to build. Maybe instead of thinking about eighteen months or twenty four months for the next race. You want to be a little more frugal and last for thirty. But with that said, the ones with the good balance sheet and the ones with good products should go out

there and innovate and take some share. So that's how Avalanche Novel Labs is treating this down term. Such a pleasure for both of you. John Wu of course, present of Alva Labs nor Vera and bloomberg sationality Bostic joining us for Crypto show as she does as always, Doctor Strange in the Multiverse of Madness topped the box office for the second straight week, underscoring the appeal of superhero films. But the theater business it is still struggling to come back.

Let's get into all of this their very own Bloomberg's Lucas Shaw. Could this be seen as a bell weather for the way the industry is recovering well? The performance of the new Doctor Strange movie is a really good sign for the movie business. It's it's outperforming its predecessor, the you know, the the initial Doctors Strange by quite a bit. It's already grossed more than it in just a couple of weeks. Uh. That being said, you know, the comic book movies are those that we know people

are coming back to see comic book movies. The most recent Spider Man movie is one of the most successful movies of all time. The real question is are people going to come in between those comic book movies? And I'm not sure Dr Strange helps us answer that interesting. I'm also thinking big picture about what we learned from Netflix and the decline of maybe the quote stay at home, the streaming the subscribers there is that a sign that maybe we're not watching it at home, but we are

indeed thinking about going back and seeing theaters outside. Yeah, and people are definitely going out into the world, you know. I'm sure you guys have have had folks on TV talking about you know, hotel stays being pretty close to normal, lots of you know, travel is up. People are going out into the world to concerts, theme parks. Um. I

don't know that that movies are everyone's first choice. You know, the movie business is on track to do better than it did in one that's of course not saying all that much. It's still well beloved right now. The numbers from twenty nineteen, Yeah, I mean, that's that's not saying a lot. I think, as you appropriately put talk to me about Netflix specifically, a strategy to look at releasing movies in theaters, maybe take advantage of the reopening. They

haven't really done that before. What is that telling you? How do you gauge the success? Yeah, you know Netflix has released movies in theaters, but not kind of globally in the major chains. They've had to pick off a lot of the smaller chains and the independent theaters. Um, there is a desire in certain corners of Netflix to take at least a handful of their titles and give them what we think of as a normal release or would be only in theaters for a month or forty

five days. There'd be a real marketing campaign behind it so that people actually knew that it was coming out, because Netflix often to save its marketing for after a title it is out. But the big question is whether the people at the very top of Netflix want to do this. You know, movie theaters as as we just discussed, want fresh product. They would love to get their hands

the Netflix movies. For all their talk about how Netflix is killing their business, but they're only going to take those movies if Netflix commits to marketing them, specifically those in theaters. And I'm hoping that we'll see some resolution on this in the next few months. I know that Netflix is talking about are exploring testing a couple of big titles in the fall, say that the sequel to Knives Out, which was a huge hit a few years ago,

But we don't know the resolution just yet. Really appreciate it. Our very own Lucashaw joining us as always, and well, that does it for this edition of Bloomberg Technology. But don't worry. We're back tomorrow and we are going to be live from Boston, starting with the Clothes to PM Eastern. I'll be joining us. Then we'll take you through Triple Take and then finishing off with the triple threat that is Bloomberg Technology. It'll be two to six pm live

of course from Boston, so make sure to check it out. Also, don't forget to check out our new podcasts. You can find it on the terminal as well as online on Apple, Spotify, and I Heart This is Bloomberg at sett