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Call it the Buffett bump? Cloud data startup Snowflake's share price massively popped at the start of trading, opening on the market at $245. The company had priced its IPO at $120 per share, raising nearly $3.4 billion for the company in what was already the year's biggest listing.
In a rare move, Warren Buffett's Berkshire Hathaway had agreed to buy over $550 million in shares in the IPO and from its former CEO Bob Muglia.
Biz Carson ( @bizcarson) is a San Francisco-based reporter at Protocol, covering Silicon Valley with a focus on startups and venture capital. Previously, she reported for Forbes and was co-editor of Forbes Next Billion-Dollar Startups list. Before that, she worked for Business Insider, Gigaom, and Wired and started her career as a newspaper designer for Gannett.
Arizona bill would reform Google and Apple app stores
HB2005 would allow app developers to use third-party payment systems.
HB2005 could make it through the Arizona House of Representatives as soon as this week.
Emily Birnbaum ( @birnbaum_e) is a tech policy reporter with Protocol. Her coverage focuses on the U.S. government's attempts to regulate one of the most powerful industries in the world, with a focus on antitrust, privacy and politics. Previously, she worked as a tech policy reporter with The Hill after spending several months as a breaking news reporter. She is a Bethesda, Maryland native and proud Kenyon College alumna.
Arizona State Rep. Regina Cobb hadn't even formally introduced her app store legislation last month when Apple and Google started storming into the state to lobby against it.
Apple tapped its own lobbyist, Rod Diridon, to begin lobbying in Arizona. It hired Kirk Adams, the former chief of staff to Arizona Gov. Doug Ducey and speaker of the Arizona House of Representatives, to negotiate with Cobb on its behalf. It quickly joined the Arizona Chamber of Commerce, which began lobbying against the bill. And lawyers for both Google and Apple went straight to the Arizona House's lawyers to argue that the bill is unconstitutional.
Emily Birnbaum ( @birnbaum_e) is a tech policy reporter with Protocol. Her coverage focuses on the U.S. government's attempts to regulate one of the most powerful industries in the world, with a focus on antitrust, privacy and politics. Previously, she worked as a tech policy reporter with The Hill after spending several months as a breaking news reporter. She is a Bethesda, Maryland native and proud Kenyon College alumna.
The future of computing at the edge: an interview with Intel’s Tom Lantzsch
An interview with Tom Lantzsch, SVP and GM, Internet of Things Group at Intel
An interview with Tom Lantzsch

Senior Vice President and General Manager of the Internet of Things Group (IoT) at Intel Corporation
Edge computing had been on the rise in the last 18 months – and accelerated amid the need for new applications to solve challenges created by the Covid-19 pandemic. Tom Lantzsch, Senior Vice President and General Manager of the Internet of Things Group (IoT) at Intel Corp., thinks there are more innovations to come – and wants technology leaders to think equally about data and the algorithms as critical differentiators.
In his role at Intel, Lantzsch leads the worldwide group of solutions architects across IoT market segments, including retail, banking, hospitality, education, industrial, transportation, smart cities and healthcare. And he's seen first-hand how artificial intelligence run at the edge can have a big impact on customers' success.
Protocol sat down with Lantzsch to talk about the challenges faced by companies seeking to move from the cloud to the edge; some of the surprising ways that Intel has found to help customers and the next big breakthrough in this space.
What are the biggest trends you are seeing with edge computing and IoT?
A few years ago, there was a notion that the edge was going to be a simplistic model, where we were going to have everything connected up into the cloud and all the compute was going to happen in the cloud. At Intel, we had a bit of a contrarian view. We thought much of the interesting compute was going to happen closer to where data was created. And we believed, at that time, that camera technology was going to be the driving force – that just the sheer amount of content that was created would be overwhelming to ship to the cloud – so we'd have to do compute at the edge. A few years later – that hypothesis is in action and we're seeing edge compute happen in a big way.
Everything you need to know about the Coinbase direct listing
Coinbase's IPO valuation could be the largest by a U.S. tech company since Facebook went public.
Coinbase will go public on Feb. 25.
Jane Seidel is Protocol's social media manager. She was previously a platform producer at The Wall Street Journal, creating mobile content and crafting alert strategy. Prior to that, she worked in audience development at WSJ and on digital editorial at NBC Universal. She lives in Brooklyn.
Coinbase, the cryptocurrency exchange, filed its S-1 on Feb. 25 to go public via direct listing on Nasdaq. In the lead-up to the IPO, Coinbase shares traded on the Nasdaq Private Markets at $373, yielding a company valuation of over $100 billion, per Axios. If share prices remain at or above these levels, Coinbase's IPO valuation could be the largest by a U.S. tech company since Facebook went public in 2012. The company hasn't yet set a date for its trading debut.
Depending on who you ask, the Coinbase IPO could be the latest symptom of a major financial bubble or a significant milestone in the restructuring of the global financial system. Coinbase's mission is to "create an open financial system to the world." It believes the prevailing system of global finance, with the U.S. dollar serving as the global reserve currency, is outdated and inefficient. This mission pits the interests of Coinbase squarely against many of the world's most powerful nations, making regulation a grave and — if cryptos continue gaining momentum — probable risk.
What does Coinbase do?
<p>If you want to buy Bitcoin or Ethereum or other crypto, you can begin the costly, labor-intensive and extremely technical process of mining. Or you can turn to a crypto exchange like Coinbase, which allows retail buyers and sellers to meet in the middle.</p><p>Coinbase also believes today's financial system relies on too many intermediaries (banks, brokers, clearinghouses, payment processors, exchanges, etc.), and that relying on this web limits access, efficiency and costs for users. The internet transformed the way we communicate and live, and Coinbase believes that the financial system has hardly been affected in the same way. By enabling anyone with an internet connection — and a bank account, with funds to invest — to easily invest in crypto assets, Coinbase aims to "democratize" access to the crypto economy. </p><p>The company isn't vastly unlike other cryptocurrency exchanges, which have come and gone since crypto trading hit the zeitgeist in 2017. General finance apps have jumped into crypto as of late, including Robinhood and Square, and crypto-specific competitors include Gemini, Kraken and Binance. Coinbase has stuck around largely because of its efficiency, but also by keeping users' personal data secure. "From the early days, we decided to focus on compliance, reaching out to regulators proactively to be an educational resource," CEO Brian Armstrong writes in the S-1. "We invested heavily in cybersecurity, built novel key storage mechanisms, and obtained a cybercrime insurance policy." </p><p>The company's exchange service is its main offering, but it also has a few other lines of business. <a href="https://commerce.coinbase.com" target="_blank" rel="noopener noreferrer">Coinbase commerce</a> provides online retailers with software that lets them accept crypto payments (like PayPal, but for crypto). <a href="https://www.coinbase.com/card" target="_blank" rel="noopener noreferrer">Coinbase Card</a> is in the early stages, giving users a physical Visa debit card and accompanying app. Coinbase even offers its own cryptocurrency, <a href="https://www.coinbase.com/usdc" target="_blank" rel="noopener noreferrer">USD Coin</a>, built on Ethereum and tied to the U.S. dollar, so the price remains stable. </p><p>At the end of 2020, the company had 2.8 million monthly active users and 43 million verified users (about 6.5% of users are active, monthly). </p>Coinbase's financials
<p>Coinbase had a stellar 2020. It recorded $1.1 billion in revenue for the year, up 136% from the $483 million in revenue from 2019. This increase in revenue tracks closely with the 142% increase in trading volume between 2019 and 2020.</p><p>Coinbase derives almost all of its net revenue (96% in 2020) from transaction fees, which have been correlated with fluctuations in the value of cryptocurrencies. The rise in institutional trading volume has been a major source in revenue growth for Coinbase over the course of 2020. For instance, in Q1 2020, institutional trading volume rose to 6x the volume of Q1 2019. And even over the course of the year, institutional trading volume went from $18 billion in Q1 2020 to $57 billion in Q4 2020. Retail trading volume went from $12 billion to $32 billion in that same timeframe. </p><p>Bitcoin accounted for approximately 41% of trading volume on Coinbase in 2020, followed by Ethereum (15%) and other crypto assets (44%). </p><p>Coinbase posted a net income of $322 million in 2020, which is pretty incredible for a company that says it's choosing "to prioritize growth because we believe that global scale is central to achieving our mission and the potential of our business model." The biggest expenses in 2020 were "general and administrative," which represented 22% of total revenue, and "technology and development," which represented 21% of total revenue. In 2019, Coinbase reported a net loss of $31 million. </p>What could go wrong?
<p>The short answer: a lot.</p><p>Coinbase is driven by a techno-utopian/libertarian mission, and its long-term success is predicated on overhauling global power structures. This comes with a long list of risk factors, but some of the most significant include: regulation by a cohort of nations to protect the central banking system, loss of public confidence in cryptocurrencies and revenue loss that would come with greater stability in cryptocurrency prices. </p><p>"If the world 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 human progress would accelerate," Armstrong wrote in the S-1's introduction. </p><p>There's a lot to unpack here, but let's start with the bit about financial standards that "could not be manipulated by any company or country." This vision would mean the U.S. dollar loses its status as the dominant global reserve currency, <a href="https://www.federalreservehistory.org/essays/bretton-woods-created#:~:text=The%20Bretton%20Woods%20system%20was,gold%20at%20the%20official%20price." target="_blank" rel="noopener noreferrer">a system established</a> at Bretton Woods following World War II. It would render The Federal Reserve — with its fiscal toolkit intended to provide economic stability — obsolete. With cryptocurrencies such as Bitcoin, there are a finite number of tokens, so quantitative easing isn't possible. </p><p>It isn't in the interest of many nations, particularly the U.S., to give up central banking control due to cryptocurrencies becoming the global reserve currency. </p><ul><li>Coinbase writes that new regulations and laws "may adversely impact the development of the crypto economy as a whole and our legal and regulatory status in particular by changing how we operate our business, how our products and services are regulated, and what products or services we and our competitors can offer, requiring changes to our compliance and risk mitigation measures, imposing new licensing requirements, or imposing a total ban on certain crypto asset transactions, as has occurred in certain jurisdictions in the past."</li><li>It also details how loss of institutional support could impact its business: "We may face difficulty establishing or maintaining banking relationships due to our banking partners' policies and some prior bank partners have terminated their relationship with Coinbase or have limited access to bank services. … In addition, financial institutions in the United States and globally may, as a result of the myriad of regulations or the risks of crypto assets generally, decide to not provide account, custody, or other financial services to us or the cryptoeconomy generally."</li></ul><p>This regulatory uncertainty hinders institutional adoption of cryptocurrencies. </p><ul><li>For instance, in January, Ray Dalio of Bridgewater Associates <a href="https://www.bridgewater.com/research-and-insights/our-thoughts-on-bitcoin" target="_blank" rel="noopener noreferrer">wrote</a>: "For now, though, we do not see it as a viable storehold of wealth for large institutional investors, thanks mainly to a high degree of volatility, regulatory uncertainty, and operational constraints. Rather, we see it as more like buying an option on potential 'digital gold' — it has a wide cone of outcomes, with one path leading to it becoming a true institutionally accepted alternative storehold of wealth."</li></ul><p>Now let's tackle the first part of Armstrong's statement about a world that runs "on a common set of standards." For Coinbase to succeed, it needs cryptocurrencies to remain valuable and worth transacting.</p><ul><li>"The development of new technologies for mining, such as improved application-specific integrated circuits (commonly referred to as ASICs), or changes in industry patterns, such as the consolidation of mining power in a small number of large mining farms, could reduce the security of blockchain networks, lead to increased liquid supply of crypto assets, and reduce a crypto's price and attractiveness," Coinbase writes.</li><li>Another potential risk factor comes with "security issues, bugs, and software errors" of crypto assets that "could adversely affect its price, security, liquidity, and adoption."</li></ul><p>Finally, there's a contradiction within Coinbase's current business model that bears mentioning: Coinbase derives most of its revenue from transaction fees, which are highly correlated with fluctuations in the value of cryptos. The contradiction lies in the fact that cryptocurrency price volatility is seen as one of the primary barriers in something like Bitcoin realizing its potential as an exchange currency rather than an asset class. </p><p>Coinbase believes this isn't actually an issue, since the dynamics will change over the long term. The company writes: </p><ul><li>"Over the long term, we expect further diversification of market participants, to add support for more crypto assets, and for crypto asset use cases to expand. We believe these factors will contribute to diversification in the composition of our Trading Volume and reduce the correlation to both Bitcoin price and Crypto Asset Volatility, subsequently leading to lower volatility in transaction revenues. Further, we expect that diversifying our sources of revenue towards subscription and services revenue will contribute to less fluctuation in our results from operations."</li></ul>Who gets rich?
<p>Coinbase has divided its shares into Class A and Class B, with Class B receiving 20 votes per share and Class A receiving only one. Class B shareholders are also allowed to convert their shares to Class A at any time.</p><p>This setup makes it difficult to say precisely which entities will own Coinbase when it makes its trading debut. As of Jan. 31, 2021, some of Coinbase's largest institutional shareholders included Andreessen Horowitz, Tiger Global, Ribbit Capital, Union Square Ventures and Paradigm. Some of the largest individual shareholders included Frederick Ernest Ehrsam III (the co-founder of Coinbase), Armstrong and CPO Surojit Chatterjee.</p>What people are saying
<ul><li><strong>"The @coinbase<a href="https://twitter.com/coinbase" target="_blank" rel="noopener noreferrer"> </a>Direct Listing will either confirm direct listings as a reasonable on-ramp for companies or kill it all together by making retail the true bag holders. If institutional investors use this period to manipulate the stock from a $54B valuation on Jan29 to $100B now... And then sell to retail at $100B or greater, it will be the ultimate form of stock manipulation. If the stock snaps back at a much lower valuation, each private txn preceding the DL seems manipulative. Good luck to all the players...I'm sitting out. The process stinks."</strong> —Chamath Palihapitiya <a href="https://twitter.com/chamath/status/1364960892958433285" target="_blank" rel="noopener noreferrer">on Twitter.</a></li><li><a href="https://twitter.com/chamath/status/1364960892958433285" target="_blank" rel="noopener noreferrer"></a><strong>"Given the Crypto Cycle, I expect Coinbase IPO to be very successful and price to pump hard. A NYSE 'exchange' security trading >$100B should help drive up Crypto Exchange tokens. I can see a bull market narrative where something like UNISWAP is compared to Coinbase in cap."</strong> — Bob Loukas <a href="https://twitter.com/BobLoukas/status/1364974896493826054" target="_blank" rel="noopener noreferrer">on Twitter</a>.</li></ul>- Tech companies normally rally behind social and political causes ... ›
- Coinbase confidentially files for an IPO - Protocol — The people ... ›
- The tech IPOs to watch in 2021 - Protocol — The people, power and ... ›
- Coinbase IPO: digital money is unescapable - Protocol — The people, power and politics of tech ›
Blockchain, QR codes and your phone: the race to build vaccine passports
Digital verification systems could give people the freedom to work and travel. Here's how they could actually happen.
One day, you might not need to carry that physical passport around, either.
Mike Murphy ( @mcwm) is the director of special projects at Protocol, focusing on the industries being rapidly upended by technology and the companies disrupting incumbents. Previously, Mike was the technology editor at Quartz, where he frequently wrote on robotics, artificial intelligence, and consumer electronics.
There will come a time, hopefully in the near future, when you'll feel comfortable getting on a plane again. You might even stop at the lounge at the airport, head to the regional office when you land and maybe even see a concert that evening. This seemingly distant reality will depend upon vaccine rollouts continuing on schedule, an open-sourced digital verification system and, amazingly, the blockchain.
Several countries around the world have begun to prepare for what comes after vaccinations. Swaths of the population will be vaccinated before others, but that hasn't stopped industries decimated by the pandemic from pioneering ways to get some people back to work and play. One of the most promising efforts is the idea of a "vaccine passport," which would allow individuals to show proof that they've been vaccinated against COVID-19 in a way that could be verified by businesses to allow them to travel, work or relax in public without a great fear of spreading the virus.
Mike Murphy ( @mcwm) is the director of special projects at Protocol, focusing on the industries being rapidly upended by technology and the companies disrupting incumbents. Previously, Mike was the technology editor at Quartz, where he frequently wrote on robotics, artificial intelligence, and consumer electronics.
Snowflake will help BlackRock clients make more sense of their data
The world's largest asset manager will use Snowflake's technology as the basis for a new addition to its Aladdin investment-management software.
Some of Wall Street's biggest financial services companies use BlackRock's Aladdin cloud service to manage their portfolios and analyze risk.
Tom Krazit ( @tomkrazit) is a senior reporter at Protocol, covering cloud computing and enterprise technology out of the Pacific Northwest. He has written and edited stories about the technology industry for almost two decades for publications such as IDG, CNET, paidContent, and GeekWire. He has written and edited stories about the technology industry for almost two decades for publications such as IDG, CNET and paidContent, and served as executive editor of Gigaom and Structure.
There are meme stonk traders, and then there are BlackRock customers. Those in the latter category will soon be able to use a new data management cloud service built in partnership with Snowflake, the first such collaboration deal struck by the data warehousing darling.
Some of Wall Street's biggest financial services companies use BlackRock's Aladdin cloud service to manage their portfolios and analyze risk. Modern professional investors have a voracious appetite for data that can inform their decisions, and need a sophisticated service that can quickly gather, sort and process reams of investment data, said Sudhir Nair, managing director and global head of Aladdin, BlackRock's technology arm.
Tom Krazit ( @tomkrazit) is a senior reporter at Protocol, covering cloud computing and enterprise technology out of the Pacific Northwest. He has written and edited stories about the technology industry for almost two decades for publications such as IDG, CNET, paidContent, and GeekWire. He has written and edited stories about the technology industry for almost two decades for publications such as IDG, CNET and paidContent, and served as executive editor of Gigaom and Structure.