Tried to radicalize fellow inmates. Global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. Im alisa parenti. This is bloomberg. Bloomberg technology is next. Emily im emily chang, and this is Bloomberg Technology. Coming up, the bitcoin rally cools after a week of gains. Back will check in on the latest Digital Currency struggles to maintain momentum and the current cryptocurrency landscape. Bonanza. Big tech we will hear from the ceos of gopro and fireeye, and talk about cyberattacks that have already played the olympics. Blue apron may finally have a dust we will break down the better than expected score finally have a record of winning. We will break down the betterthanexpected scores. The bitcoin gains we have seen the last few days have come to an end, snapping the longest rally since september. I am joined by cory johnson. Walk us through the day and where it is going. Cory we dont know who the buyers and sellers are. I think we have seen in a bounce off the bye week for a technical basis, whatever that means, but the treating in these things were in a freefall. They were all trading in lockstep with each other despite important differences between the different types of cryptocurrencies. All turning together, all getting a bounce, but we have seen a separation between the different kinds of currencies over the last week. You can see it in the pricing of the different currencies. Emily talk about how the other currencies are tracking relative to bitcoin. Cory they separated little bit. Yesterday, you saw a big bounce with one over 20 . Bitcoin was up a fraction of that. There is a little bit of a separation showing up. Emily what is driving that . Cory who knows. The notion speculation seems to be the steady stream of companies washing out rushing out to create new coins have no rhyme or reason except for the few that did. A recognition of what we have said that some of these Technological Solutions actually have a purpose and a point. The others are a store of value a way to speculate looking more and more silly. Some of these speculative scheme has been taken out of the market is. The fans going check had frozen withdrawals japans coin check had frozen withdrawals. What you think of that . Cory if i can buy this thing, so we will buy it more later. That was broken by this notion of the currency that you had ever heard of before losing hundreds of millions of dollars in value. The idea that Something Like that can have that value surprised a lot of other people, but the people involved in it must have known at some level that this thing they were buying, they were only buying so they can sell it to someone else. I think it is a failure of what we do as journalists sometimes, not just journalists, me and you of course but talking about stocks as if they go up because they should go up or down because they are going down. Talking about intrinsic value, the businesses of underlying them. To speculation because it leads to people not knowing what they are doing and why they are buying things. We think about cryptocurrencies as an investment or equities in investment or debt as an investment. The underlying thing is we are investing in his will he need to understand. Emily what do you think regulators are learning from fiascoes like this . Cory we have heard Different Things. But i am actually pleased to hear what i hear from some regulators, which is the notion that they are not all the same and regulation can protect investors from the shams and crooks and that Real Companies flourish with a light hand where protections are needed and maybe regulations are not. Emily cory johnson, our editor at large. We will dig into it right now with brad. Sticking with bitcoin, we caught up with one of the biggest players in the Digital Currency market. As we just discussed, it has gone up and down with the market. Take a listen. We have already seen that the markets bounce back some. I dont call a daytoday, but the peak of the market probably midjanuary total asset class was like over 800 billion. Drop dropped down to maybe 300 billion. Today it is back to 450 billion or so. My counsel for anyone in these markets is do not follow daytoday. This is for the mentally a movement that is changing the class. And a new asset you should measure that over months and years, not daytoday. Emily revolt was doing well at the in of the year. Talk of it being the next bitcoin. Is that the benchmark for you . Brad i dont think there will be onesizefitsall. I think bitcoin increasingly is digital gold. It is a storer of value but it will not solve a payments problem. The time it takes to confirm a bitcoin transaction on average is about three to four hours right now. Per transaction, the fees are around 15 per transaction. That is faster than swift, but in contrast, 1000 times faster and 1000 times cheaper, so it is a fraction of a cent to confirm a transaction, and it takes three seconds to complete a transaction. I look at bitcoin as solving a different problem than what axa rv is solving xrp is solving. I think you will see multiple players have success in this market. I think that is how the market is behaving well have a little bit of quality rising to the top and how the overall market s have been trending. Emily for some, there will be more regulation. What are you expecting . Brad i hope there is more regulation. I think if we want a whole asset class to grow up and mature, of course there should be regulation. Those that combat regulation are not thinking about the benefit. The revolution of blockchain is not going to happen from outside the system. It is going to happen from within the system. Governments are not going to go away. Banks are not going to go away. Some from the Community Come from that anarchistic libertarian view. One of the reason why ripple has been successful is we are working with the system. We count the bank of england as a customer, the Saudi ArabianMonetary Authority is a customer. Central banks are working with ripple today. We expect that to continue in the future for sure. Emily what do you think the regulation should be . Brad i think the regulation should not change much. What i mean by that is when you are executing a transaction using ripples software, they are going through one regulated station to another regulated station. Requirements, your know your customer requirements, antimoney laundering requirements, Bank Secrecy Act requirements, that does not change because the bank is doing that on both ends. We are just making the plumbing much more efficient, faster, cheaper. Here, weatory dynamics should continue to have regulated financial systems. Thele are, oh my gosh, regulation will change, xrp is not circumventing the regulation. Emily what about what is happening in asia . Does that concern you . A lot of skepticism there. Brad it concerns me if we throw the baby out with the bathwater. We have to understand that not all Digital Assets are the same. We did an oped piece written by our chief Compliance Officer to kind of talk about some of the differences. Some Digital Assets that are designed for anonymity, designed to circumvent regulation. I literally saw a founder of a company talking about his Digital Asset like we are for drug dealers and people in tax evasion. Of course there is going to be enforcement against that. That is crazy to me that he was in a public setting saying that ithat. In contrast, we are working with Central Banks within the Regulatory Framework and we are embracing the factor should be Regulatory Frameworks applied to the Digital Asset and crypto market. Emily you just partnered with leon. Brad one of the largest payment digital wallet Payment Companies in china. Emily what does this mean . What other partnerships are to come . Brad to think of a world with the banks, the atms of the world, the paypals of the world, and we think about how do we enable interoperability and very little fiction between the . We will continue to work with players across the world. I think people understand proposition, our pipeline of partners and customers has certainly grown, and i am excited to come back and keep you posted on those customer announcements. Emily all right. The year in brooklyn, cryptocurrency, 2018, what are you expecting . Brad despite the volatility, you will see a lot of bullish behavior. Emily the volatility will continue . Brad the volatility will certainly continue. We are in adolescent stage of developing a new asset class. You will continue to see volatility. Emily my conversation with brad, the ceo of ripple. Tim cook address shareholders tuesday at the companys annual meeting. Discussed, the tax overhaul and a slowdown in mobile payment. He said one of them was supportive roles as ceo is passing the baton to the next leader. Taking aim at the winter olympics. We sit down with one of the companies on the frontlines of cybersecurity and take stock of the dangers out in cyberspace. That is next. If you like bloomberg news, check us out on the radio. Listen on the Bloomberg Radio app, bloomberg. Com, and sirius xm. This is bloomberg. Ceo of salesforce says a movement is coming at facebook and it will not be pretty. Timesg at the new york new work summit, he said it is just the start of a growing backlash against facebook and he criticized facebook decisions to dismiss human editors instead of algorithms. He set the start of the downward spiraling that they are in today. The winter olympic for up to a roaring start complete with metals and feelgood stories and cyberattacks. The hacked because the Network Communications to fail during the opening ceremonies. While there is no suspect, it increases the need for vigilance in the face of future attacks. Earlier, we sat down with kevin from fireeye at the golden technologychs and what he sees out there. I have lived through four different waves are phrases of cybersecurity and we are in the fourth. We have modern nations engaging in Cyber Operations with no rules of engagement. Nobody knows what the rules should be. What is fair game . How do you conduct espionage . Espionage goes through secrets are. Also because there are no repercussions for Cyber Operations, meaning it is hard to figure out who is doing it. A lot of times, it is like a great area. People dont know if they are doing the right or wrong things in cyberspace. That is the phase we are in right now. We are seeing a lot of attacks from nationstates on nationstates i dont think the gloves will come off yet, but Different Things being said. Emily interesting it is happening in this idea of right and wrong given that there are some attacks that are ok . Kevin it depends on perspective, right . Every nation wants to defend itself, know every nations sigrid. There s. There will always be espionage and differences. Capabilitya modern percent reparations and we have not figured out as a Global Community how to operate. Emily how would you describe threats from russia versus north korea versus china and how they have evolved . Kevin they are all different. They have gotten better. Emily break it down for me . Kevin the russians are great at this. They know how to be surreptitious and how to commit operations, but they cannot operate at the scale and scope that the chinese do. The chinese recently, especially the united states, have been operating with some rules of engagement. They are a little more obvious. They dont do as much counter forensics, but they are often more widespread. North korea is a little less protectable. They hack for multiple purposes, to make money, for espionage, but they also have to be distracted. If you look at other nations, we have seen vietnam get on the radar and other nations start to. Iran is getting big in Cyber Operations as well. All of them have a different capability and different forensics they leave behind. Emily any insight into who hacked the opening ceremonies . There is some speculation it was russia. Kevin from the information i have seen, we are not sure who is behind it. That is another example. Anytime you do a major event, there are no risks or repercussions to pull to attack it. Emily how is Cybersecurity Spending changing relative to last year . Kevin i have not noticed a big change. Right now, i know if you are hacked and you know it, the impact and consequences seem higher than in the past. It has gone up over the last decades. Used to be when you are hacked, it was a business problem. It has gone to be much larger now. , when you are hacked and you know it, the bottom line is consequent is our growing. Therefore, more board attention and ceo attention. People are making sure they at least get a good why on the spending. Emily have you seen any Market Corrections . Kevin i dont know if i have. I can looking around. I go to the conference every year and i cannot remember how Many Companies are there but there are thousands of companies proclaiming to do cybersecurity and it feels like there are 10 or 11 i guess. I question how Many Companies the market does support, but thousands feels like a little bit too much to me. Emily how does fireeye standout . Kevin you are right, we are the same thing, but what makes us unique is there are a lot of companies that appear product companies. We do our Market Research by responding to evidence that matters. Responding to the breaches on the frontlines, we also have an amazing vantage point. Who is attacking who . So you can assign risk in your industry. For example today, there is a lesson attack Group Interested in attacking the energy grid or whatever it might be. You want to see those trends and we see them on the front lines. We have nearly a million hours of frontline investigations every single year. If you take that and put it in, we are finding a needle in a haystack every day with people. That is all software is, automating the human process. Emily do you think we will see more consolidation . Kevin i think so. That is more likely than not, right . You saw cybersecurity become a marketplace in the last decade, maybe even within the last six or seven years. Thousands of companies have run into this marketplace. Not all of them are going to survive. There will be a lot of losers and some winners. During that opportunity, they will be consolidation. Emily who gets bought or survives . Kevin every community has the different strategies. I like to meet the founders and make sure the genesis of a Company Makes sense. What they are doing aligns with their experiences compassion. There is a lot of companies that make sense. There is a lot that dont. Emily that was fireeye ceo kevin mantia speaking with us. Coming up, finally delivering for investors. A look at the companys betterthanexpected financial results. That is next. This is bloomberg. Emily and the latest revolving door at snap. Jeff lucas has announced he is leaving the social media company. Snapchat and was crucial to building advertisers. He is the third leading executive to Department Company in the last four months. They also lost their head of product and engineering in november. Snap says it will not be looking for a replacement for lucas. Blue apron has struggled since it went public in june of last year, but could the yearend results mean they have ironed out some of the kinks . Shares jumped of most in two months and beat analyst estimates and the new ceo is predicting significantly narrower losses this year, so is blue apron out of the woods yet . To answer that, lets bring in garrett. I am guessing the answer is no, but why did the stock jumps in which today . Garrett they beat analyst estimates on revenue and profit, which is a law still, but it was the language like him out of the statement and a call as well with the ceo Brad Dickerson to go over in november to try to patch up some of the major problems they had had over the last year. The labor to use is words like stability and confidence. He said a lot of the problems they have had over the last year have been taken care of. He said he will increase marketing spending, which is something that they cut last year and the two goats falling off a cliff as they were trying to get there should back in order their ship back in order. The stock jumped in the beginning part of the day but by the end of the day, it was back to where it was before the close before the earnings came out so analysts after digesting it said maybe things are not as rosy as we initially thought in the morning. Emily what remains the biggest risk factor for this company . Gerrit the biggest risk here is that competition from amazon sort of overtakes them. Analysts asked Brad Dickerson a question, how do you come out of the gate and face some of the heavy competition from amazon and other upstarts, he said we have a lot of products coming out this year that will change our offering and allow us to charge more money and find more customers. People said, ok, what are those products . He said we dont want to talk about it yet so that is where some of this uncertainty comes from. They dont just want to be a meal kit company. They want to be a full consumer lifestyle brand. We are still waiting to see what exactly that is going to look like. Emily so when you look at 2018, what are the main things you are going to be watching . Gerrit well, those products are going to be a key one. We will have to see exactly what they roll out. They will probably be talking about the product in the next few months. That can be anything from doing partnerships with other food companies. You can think about it they have this brand that is trying to be kind of cuisine forward, fresh forward, healthy for you, but easy to prepare. Anything in that