Coinbase, one of the most popular regulated cryptocurrency exchanges and depositories, is expected to be valued at more than BP this week as it makes its stock market debut.
The company, which has become the most popular regulated cryptocurrency exchanges and depositories on the web, is expected to pop as it lists on the Nasdaq on Wednesday.
Coinbase was most recently valued at $91.5bn (£67bn) - higher than BP’s current market capitalisation of $84bn. That price tag is predicted to inch closer toward $100bn on Wednesday, possibly even beating that of Facebook which was valued at $104bn when it went public in 2012.
In the first three months of the year Coinbase made $730m in profit on revenues of $1.8bn, bolstered by Bitcoin’s meteoric rise. The exchange lured 13m new users in the first three months of 2021. Brian Armstrong, Coinbase’s chief executive, says that the company has been profitable since 2017.
Yet some investors remain sceptical as to whether Coinbase, and the nascent cryptocurrency industry, signifies a new world order or whether the company’s success is a blip fuelled by a frothy market, US government underwriting and the younger generation who has had more time on their hands to invest their Covid-19 stimulus money in novel ways.
As almost all of Coinbase’s revenue is generated from transactions, Wall Street analysts are waiting to see whether the volatility of cryptocurrency means the company is in for a bumpy ride.
How to buy Bitcoin
In the company’s Initial Public Offering prospectus, Mr Armstrong slammed the banking systems “high fees, delays, unequal access, and barriers to innovation”.
He said: “If the world economy ran on a common set of standards that could not be manipulated by any company or country, the world would be a more fair and free place and humans would accelerate...The cryptoeconomy offers a more global, free, and fair alternative to traditional economies that is native to the internet.”
Mr Armstrong is keen to move away from taking a cut on customers’ trades and wallets, and to become something of a bank on its own. It already offers a debit card in the UK that allows customers to spend their crypto at retailers which take Visa.
Despite its healthy balance sheet, this desire to replicate a financial system that has led critics to accuse Coinbase of becoming a contradiction in terms, one which could ultimately cause its downfall. The attraction to Bitcoin and other digital coins has long been their fragmented nature, separate from the central banking system or “decentralised”.
05:12 PM
That's all from us
Check in tomorrow morning for more technology news!
05:12 PM
Cambridge Quantum computing spin-off nabs DeepMind professor
Cambridge Quantum Computing, a company that makes software for quantum computers, announced that it has hired DeepMind’s former Senior Staff Research Scientist, Professor Stephen Clark, as its new Head of Artificial Intelligence.
At DeepMind, Professor Clark led a team of researchers, working on grounded language learning in virtual environments.
He is also an Honorary Professor at Queen Mary University of London and spent 10 years as a member of faculty at the University of Cambridge Department of Computer Science and Technology.
Ilyas Khan, chief executive of CQC, said, “I am thrilled to welcome Prof. Clark to Cambridge Quantum where he will join as a senior member of our amazing scientific team as head of Artificial Intelligence. Steve’s reputation and standing are of the highest order and I am excited at the perspective and leadership he brings at this vital time of our development.
"We have a hugely ambitious programme of work to make the most of quantum computing hardware in these early stages of their development, whilst also preparing applications that will affect humanity as a whole when quantum computers scale and approach fault tolerance.”
04:23 PM
Uber signals ride hailing is on the road to recovery
Uber said bookings through its food delivery and ride-hailing businesses returned to pre-pandemic levels last month, a sign that the economy may be on the road to recovery, Mutaz Ahmed writes.
Demand for ride-hailing fell at the height of the pandemic, but Uber said it took in $30bn (£21bn) in revenue, up 9% from the previous month.
Uber linked the record numbers to the successful US vaccination campaign, stating that as more Americans get vaccinated, “consumer demand for mobility is recovering faster than driver availability, and consumer demand for delivery continues to exceed courier availability.”
It warned the cost of a recent settlement with UK drivers would impact its first quarter revenue, according to a filing. It will announce its first quarter earnings on May 5.
Last month the company was ordered by a British judge to treat its drivers as employees rather than independent contractors, which could damage its competitiveness in the European market.
Uber has around 70,000 drivers in the UK, which accounts for 6.4pc of its global market.
The company, which has become the most popular regulated cryptocurrency exchanges and depositories on the web, is expected to enjoy a blockbuster debut on the Nasdaq on Wednesday.
It was most recently valued at $91.5bn - higher than BP’s current market capitalisation of $84bn. However, that price tag is predicted to inch closer toward $100bn on Wednesday, possibly even beating that of Facebook which was valued at $104bn when it went public in 2012.
In the first three months of the year Coinbase made $730m in profit on revenues of $1.8bn, bolstered by Bitcoin’s meteoric rise. The exchange lured 13m new users in the first three months of 2021. Brian Armstrong, Coinbase’s chief executive, says that the company has been profitable since 2017.
Some investors remain sceptical as to whether Coinbase, and the nascent cryptocurrency industry, signifies a new world order or whether the company’s success is a blip fuelled by a frothy market, US government underwriting and the younger generation who has had more time on their hands to invest their Covid-19 stimulus money in novel ways.
03:18 PM
Global PC market swells by 55pc to 82.7 million
Sales of personal computers surged 55pc in the first three months of the year as the market for consumer electronics continued to be buoyed by lockdowns and home working, writes my colleague Matthew Field.
In the strongest quarter for home computing sales since 2012, 82.7 million PCs, laptops and workstations were sold, according to data from Canalys.
The analysts said the numbers appeared particularly strong due to weak demand in the first quarter of 2020, when the Covid pandemic led to a sharp downturn.
Apple enjoyed some of the strongest growth, according to industry data, with sales growing 105pc year-over-year with approximately 6.6 million MacBook PCs sold. It comes on the back of a re-launched Apple line-up that featured faster M1 processors last year.
Lenovo and HP remained the market leaders with 24.7pc and 23.3pc of sales respectively.
Analysts said they expected supply chain problems due to demand to continue, but said this was a "good problem to have" for PC makers who have endured weak sales for several years.
Rushabh Doshi, Canalys research director, said the new demand was leading to a wave of new investment from chip makers for future generations of laptops.
02:30 PM
Apple revives smart home ambitions with new multipurpose device
Apple unveiled its new HomePod Mini in October 2020 - Apple
Apple is reportedly working on its most ambitious smart-home hardware offering for years and is in the early stages of developing a product that would combine an Apple TV box with a HomePod smart speaker and a camera for video conferencing.
According to Bloomberg, the device would allow users to watch video, game, play music and communicate with Siri, Apple's digital assistant.
The technology giant is also considering a high-end speaker with a touch screen and a camera to better compete with Google and Amazon.
Apple has lagged behind rivals in the smart-home category.
According to Strategy Analytics, the HomePod smart speaker has occupied less than 10pc of the market for most of its existence. Last month, the company discontinued its high-end HomePod, although its cheaper HomePod mini remains on sale.
01:49 PM
Microsoft has confirmed it will buy tech behind Siri
Microsoft has confirmed it will acquire the artificial intelligence and speech recognition company which is responsible for the technology behind the iPhone's voice assistant known as Siri.
Microsoft will buy Nuance for $56.00 per share in an all-cash transaction valued at $19.7bn (£14bn), making this the company's second largest transaction, behind the $24bn (£17bn) LinkedIn buyout in 2016.
Analysts expect Microsoft to use the same Nuance technology which enables Apple's "Siri" voice assistant to recognise what iPhone users are saying to "double down" on its position in the healthcare industry.
"AI is technology’s most important priority, and healthcare is its most urgent application, said Microsoft CEO Satya Nadella in a social media post.
"Together with [Nuance], we will put advanced AI solutions into the hands of professionals to drive better decision-making and create more meaningful connections."
AI is technology’s most important priority, and healthcare is its most urgent application. Together with @NuanceInc, we will put advanced AI solutions into the hands of professionals to drive better decision-making and create more meaningful connections. https://t.co/ipdP6qZTx9
Last year, Nuance co-developed an AI tool with Microsoft called "Dragon Ambient eXperience" which is able to listen to a patient's conversation with their doctor, extract the medically relevant information and translate it into a format required for clinical documents.
Gregory Moore, Corporate Vice President, Microsoft Health and Life Sciences, said he wanted the partnership to "dramatically help reduce the overwhelming burden of administrative tasks and clerical work that has made it so difficult from [doctors] to do what inspired them to go into medicine in the first place—connect with individuals face-to-face".
Mark Benjamin will stay on as CEO of Nuance, reporting to Scott Guthrie, executive vice president of Cloud and AI at Microsoft. The deal is expected to close later this year.
Microsoft has been busy striking deals this year. Last month, the company was in talks to acquire social media platform Discord. It also closed a deal to buy video-game maker Zenimax Media for $7.5bn (£5.45bn) cash earlier this year.
"Microsoft is on the M&A warpath over the next 12 to 18 months," Dan Ives, analyst at advisory firm Wedbush said in a note, adding the deal "fits like a glove" into Microsoft's healthcare endeavors at a time when doctors are embracing next generation healthcare tools.
12:05 PM
$100bn club welcomes two new members
An elite club of people with fortunes worth more than $100bn (£73bn) has welcome two new members after a rally in tech shares, reports my colleague Matthew Field.
He writes:
Google co-founders Larry Page and Sergey Brin joined the centibillionaires group last week, according to the Bloomberg Billionaires Index, after adding more than $20bn each to their wealth this year.
Page is currently the world's sixth wealthiest person with a fortune of $103.6bn while Brin, worth $100.2bn, comes in at eighth.
PensionBee to be valued as high as £384m in London float
Romi Savova, founder and CEO of Pension Bee - Telegraph
Pensions start-up PensionBee is set to be valued as high as £384m when it floats in London later this month, James Cook writes.
The business said this morning that it expects its float valuation to be between £346m and £384m, an increase on the initial £300m valuation given last month.
The increased valuation could see chief executive Romi Savova’s 45pc stake in the company rise to be worth as much as £172m, cementing her position as one of the UK’s most successful female technology entrepreneurs.
PensionBee’s float will see Ms Savova’s net worth overtake Starling Bank chief executive Anne Boden, whose stake is valued at £125m following its recent fundraise.
The pensions start-up plans to raise £55m in funding from the float to help it pick up more customers. PensionBee currently has around 130,000 active customers who use its app to manage their pension.
Ms Savova told The Telegraph last month that the business has been planning to go public since 2016.
“It's always been on the roadmap because I think large financial services companies that serve consumers ultimately end up being public,” she said.
The start-up plans to reach breakeven by the end of 2023 before beginning to generate profits for the first time.
“Our view is that at the end of the day, businesses need to be profitable,” Ms Savova said.
The start-up remains focused on growth in the UK rather than international expansion. “For us it feels like the growth opportunity here is just so big that it's tough to make a business case to be abroad,” Savova said.
PensionBee’s raised valuation comes as Darktrace, another British technology start-up, confirmed its plan to float on the London Stock Exchange later this month with a valuation that could reach as high as £3bn.
Deliveroo’s market debut last month was one of the City’s worst recorded floats after its share price crashed more than 25pc, wiping £2bn off its valuation.
11:01 AM
China tells Ant to restructure as financial holding firm
Chinese Fintech giant, Ant Group, has been directed by the country’s central bank to restructure, transforming itself from a technology business into a financial holding company.
The People's Bank of China said on Monday Ant has formed a "comprehensive and feasible restructuring plan," at the request of financial regulators.
The change in structure means the affiliate of tech giant Alibaba will be subject to strict capital requirements and stronger banking regulations.
Since billionaire co-founder Jack Ma made comments critical of the Chinese Communist Party in October, efforts have been made to reign in the influence of both him and his companies.
The government shocked markets when it cancelled Ant Group's planned $35bn (£26bn) initial public offering in Shanghai and Hong Kong in November.
Two days ago, Alibaba was also handed a record $2.8bn antitrust fine, although the amount was smaller than some expected.
The enforced overhaul is expected to dramatically reduce the valuation of Ant Group in any future IPO, even as the company retains the title of the world’s largest mobile payments provider.
Estimates by Bloomberg Intelligence have revised the company's value to less than 700bn yuan (£74.5bn), down from valuations that ran as high as £232bn before the company retracted its record initial public offering in November.
10:04 AM
Bitcoin nears all time high in anticipation of Coinbase debut
Bitcoin neared an all-time high on Monday in anticipation of a listing by Coinbase, the largest U.S. cryptocurrency exchange.
The world's most popular cryptocurrency reached $61,229 earlier today, just short of the March 13 peak of $61,742.
Coinbase's public debut on the Nasdaq on Wednesday is the first listing of a major cryptocurrency company and will test investor appetite for the wider blockchain sector.
08:25 AM
Poll shows Toshiba CEO losing employee support
Toshiba Corp's CEO Nobuaki Kurumatani attends a news conference at the company's headquarters in Tokyo in 2018 - Issei Kato/Reuters
Toshiba CEO is losing support among executives and other employees, according to internal surveys at the company.
Less than 60pc of employees have confidence in Nobuaki Kurumatani, down from 90pc last year, according to a January internal poll reported by Bloomberg.
Kurumatani has been CEO and president since 2018 but the poll suggests his future is now in doubt as Toshiba faces a potential buyout offer from UK-based CVC Capital Partners.
Cybersecurity company Darktrace confirms London float
British cybersecurity CEO, Poppy Gustafsson, is expected to net £20m as her firm Darktrace confirms its intention to float in London.
In a statement published on Monday, the company said it plans to sell shares to fund product development and announced revenue had risen to $199m (£145m) in the year ending June 2020, up from $137m (£99.8m) the previous year.
Darktrace is expected to be valued at close to £3bn, as the company benefits from the cybersecurity challenges created by the nation's offices working from home.
Founded in 2013, Darktrace uses artificial intelligence to automatically detect cyber threats, ranging from insider attacks to state-sponsored espionage.
The blockbuster IPO in London is likely to revive optimism surrounding UK tech listings after the disastrous Deliveroo debut — seen as a major blow for the city which is overhauling its listing rules to attract more technology firms planning to go public.
Gustafsson said on Monday: “Our intention to list on the London Stock Exchange marks a major milestone in Darktrace’s history of rapid growth, and a historic day for the UK’s thriving technology sector."
However the company's path to IPO has not been smooth. In February, investment bank UBS resigned from the float amid compliance issues, raised during the extradition proceedings surrounding controversial tech entrepreneur Mike Lynch.
Mr Lynch’s venture capital firm Invoke was Darktrace’s first major investor in 2013, and he stepped down from the company’s board in 2018. The US government is seeking to extradite Mr Lynch from Britain to the US so he can face fraud charges. Mr Lynch denies the charges.
The British tech sectors most likely to spawn $1 trillion companies
06:33 AM
Alibaba shares rally after record $2.8bn antitrust fine
Jack Ma, billionaire founder of Alibaba Group, arrives at the "Tech for Good" Summit in Paris, France in 2019 - Charles Platiau/Reuters
Alibaba shares have leapt 8pc in Hong Kong, after the tech giant was fined $2.8bn (£1.9bn) as part of a Chinese antitrust investigation.
Despite the record amount and the accompanying “rectifications” Alibaba is required to put in place, the fine was less severe than some expected and is expected to put an end to the uncertainty caused by the four-month long investigation.
“We’re happy to get the matter behind us,” Joseph Tsai, co-founder and vice chairman, said on an investor call on Monday.
He added he was not aware of any more antitrust investigations against the company.
Among the changes Alibaba must introduce, Regulators have instructed the tech giant to curtail its practice of forcing merchants to choose between Alibaba and a competing platform.
“Despite the record fine amount, we think this should lift a major overhang on BABA [Alibaba] and shift the market’s focus back to fundamentals,” Morgan Stanley wrote in a note.
The company thanked regulators for the fine, which amounted to 4pc of its 2019 domestic revenues, but was significantly less than the 10pc threshold allowed by China's antitrust law.
"Alibaba would not have achieved our growth without sound government regulation and service, and the critical oversight, tolerance and support from all of our constituencies have been crucial to our development,” the company said in an open letter.
Jeff Bezos amassed his wealth through Amazon stocks and owns hundreds of millions of dollars worth of real estate, but one of his most valuable possessions may surprise you: art. Among his collection is the renowned piece "Hurting the Word Radio #2 (1964)" by Ed Ruscha, purchased by Bezos for almost $53 million. This artwork, a prime example of Ruscha’s text-based paintings, stands as a signature piece in Bezos’ collection. As concerns over stock market volatility persist, the world’s wealthiest
AI startup Anthropic is changing its policies to allow minors to use its generative AI systems -- in certain circumstances, at least. Announced in a post on the company's official blog Friday, Anthropic will begin letting teens and preteens use third-party apps (but not its own apps, necessarily) powered by its AI models so long as the developers of those apps implement specific safety features and disclose to users which Anthropic technologies they're leveraging. In a support article, Anthropic lists several safety measures devs creating AI-powered apps for minors should include, like age verification systems, content moderation and filtering and educational resources on "safe and responsible" AI use for minors.
