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- 📈 Bitcoin Surges Near $44,000
📈 Bitcoin Surges Near $44,000
Plus, Spotify enters it's own 'year of efficiency'...
TOP STORY
🪙 Bitcoin Surges Near $44,000, Longest Streak Since May
In the past week, Bitcoin rose ~18% over a 6-day rally, posting its best performance streak since May. Bitcoin is now up a staggering 164% YTD, a big rebound from the crypto slump last year when the cryptocurrency fell 65%.
This growth (or hype) is driven by a few key reasons:
🧑⚖️ The anticipated approval of the spot Bitcoin ETF in the US
While Spot Bitcoin ETFs have been permitted in Canada for years (with Purpose’s Bitcoin Yield ETF $BTCY ranking as the 20th most popular ETF in the Blossom community), they are currently restricted in the US
The Bitcoin rally really kicked off after the mid-October ruling by the D.C. Circuit Court of Appeals ordering the SEC to rescind its rejection of Greyscale’s spot ETF application. Many buyers are ‘front-running’ what they anticipate will be significant flows into Bitcoin if the SEC approves a spot Bitcoin ETF, as this opens the door for institutional capital.
🥑 Bitcoin Halving Next Year
Bitcoin is on track to half in April, something that only occurs roughly every 4 years as a mechanism to limit Bitcoin to 21 million tokens. Historically, Bitcoin price halvings have resulted in a price increase in the months that followed as it essentially has a deflationary effect on the currency.
🧑⚖️ FED interest rates
The FED holding interest rates steady in June, pausing the 15-month rate hike cycle, has an inflationary impact (the FED increases rates to curb inflation), and greater inflation and volatility in the dollar traditionally leads to more interest in cryptocurrency.
🤑 Good ol’ fashioned FOMO
Forbes says the crypto market has shifted from “fear” to “greed”, and while there are valid reasons for the surge, some of the price growth is likely driven by hype and bullish sentiment.
🤔 The Blossom Community Has Mixed Feelings on Bitcoin
Unsurprisingly, Bitcoin was a hot-topic in the Blossom community this week, with mixed feelings about the cryptocurrency.
On one side of the aisle, there was a noticeable surge of excitement regarding the week's news, with @dividendhunter1 suggesting, "we may have to pop some champagne🍾 or light a cigar💨" while others express the complete opposite sentiment, with a popular post by @jacobb claiming "Bitcoin is a scam (kinda)."
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BIG TECH
🎶 Spotify's Lays Off 17% of Workforce, Music to Investor’s Ears
Spotify's made some big moves this week. Along with dropping Spotify Wrapped, the streaming giant also dropped the news that they're trimming their workforce by a whopping 17%— about 1,500 jobs. This comes after the streaming giant posted its first profitable quarter in more than a year.
While definitely bad news to the folks getting laid off, investors took this as a positive sign, with the stock ending the week up ~3%, bringing the stock to an over 141% YTD return.
CEO Daniel Ek was blunt about the decision to cut jobs:
Today, we still have too many people dedicated to supporting work and even doing work around the work rather than contributing to opportunities with real impact.
🎙️ Podcasting Struggles
This cutback comes after a 3-year hiring frenzy, where Spotify more than doubled its workforce since 2020, specifically adding to its podcast divisions. But it seems like the company’s big bet on podcasting isn’t paying off as expected. After dishing out over a billion dollars for podcasts, the company is hitting the pause button, canceling shows, and letting go of podcasting staff.
🪧 Activist Investor Pressures
The layoffs were also likely driven by pressure from activist investor ValueAct saying Spotify’s cost had ‘exploded”. This mirrors the vocal pressure for Meta to reduce staff by activist investor Altimeter Capital, which led to mass layoffs.
👨💼 Goodbye Mr. CFO
Not only are jobs on the chopping block, but Spotify's Chief Financial Officer, Paul Vogel, is also packing his bags and will be out the door by March 31st, 2024. CEO Ek says Spotify is entering a 'new phase' and needs a CFO with a different set of experiences.
👀 What’s Next
So, what's next for Spotify? It's a mix of uncertainty and a quest for profitability. Overall, it looks like Ek is following a similar playbook to his friend Mark Zuckerburg, whose ‘year of efficiency’ is looking to have paid off. Time will tell if the same will be true for Spotify.
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BATTLE OF AI
🤖 Google Unveils Gemini, Faces Heat for Edited Demo
Google wowed the internet this week with the release of the demo for its new AI model ‘Gemini’, with a video showcasing its ‘multimodal’ capabilities to respond in real-time and reason about what it sees in a series of images.
Gemini can understand the world around us in the way that we do. It’s capabilities are state-of-the-art in nearly every domain
🤯 Big Claims
Google made some big claims about Gemini, claiming it’s more powerful than OpenAI’s ChatGPT. Google swears Gemini is not just a GPT-4 competitor but a ‘game-changer’, with Gemini wins in 30 out of 32 tests, with a special knack for handling video and audio. According to Google, it’s faster, cheaper, and more efficient, trained on Google's Tensor Processing Units.
Alphabet’s CEO, Sundar Pichai, calls it the start of a new AI era, with three flavors: Gemini Nano for Android devices, Gemini Pro powering Google AI services, and the heavyweight, Gemini Ultra, designed for data centers.
😬 Google’s AI Struggles
With that being said, some reports suggest Google struggled with its development, facing challenges with non-English queries and even delaying Gemini Ultra's launch.
Google has also faced significant heat when it was discovered that the demo video for Gemini was not conducted in real-time, a deja vu from the company’s release of Bard earlier this year which was called “rushed and botched”.
📈 Investor Response
Criticism aside, the markets responded positively to the announcement, with the stock rising 5% on the day of Gemini’s release, and ending the week up 4%. The AI showdown continues, keep the popcorn rolling 🍿.
FROM THE BLOSSOM COMMUNITY
🎙️ Top Discussions This Week
🗞️ What else you might’ve missed:
McDonald's (MCD) is aggressively expanding its global footprint, targeting 50,000 locations by 2027
Microsoft ($MSFT) is set for another legal battle with the FTC over its $69 billion acquisition of Activision Blizzard
Royal Bank of Canada ($RY) faced a fine of C$7.48 million for not reporting suspicious transactions related to potential money laundering or terrorist financing
Apple ($AAPL) head of iPhone and Apple Watch design leaving company
Paramount ($PARA) stock surges more than 14% after new report floats breakup possibilities