Bitmain Technologies (Bitmain), a Beijing-based corporation that specializes in cryptocurrency mining equipment, initiated an application to take its company public in late September of 2018 with the Hong Kong Stock Exchange.

Amidst the pending initial public offering (IPO) application, cryptocurrencies, such as Bitcoin, have significantly dropped in value this year. In early 2018, Bitmain’s sales followed suit due to a disproportionately high supply in relation to demand. However, the company is still on track to hit $10 million in annual revenue despite the observed fall in cryptocurrency value.

Since Bitmain’s technology is reliant upon the market for cryptocurrencies, there is great speculation over how well Bitmain will fair once its IPO is issued. Pending success as a publicly-traded company, Bitmain will likely serve as a model for emerging startups engaged in cryptocurrency-related business practices. However, Bitmain’s path to success is largely unpaved and unclear, which may cause risk-averse investors to keep Bitmain at arms-length. For instance, Tencent Holdings and Softbank Group, Uber’s largest shareholder, are reportedly not involved in funding Bitmain’s IPO.

Notwithstanding the close relationship between Bitmain and the cryptocurrency market, Bitmain appears to be relatively prudent in terms of its business dealings. By diversifying its products, Bitmain has made its company more appealing to investors by shielding itself from the seemingly volatile cryptocurrency market. Not only has it focused on creating mining equipment for a diverse group of cryptocurrencies, it also seeks to enter the artificial intelligence space. Investors are likely more willing to financially support a company that not only illustrates its knowledge about the risks associated with the cryptocurrency market but has concrete plans to protect itself from those same risks.

In addition, there has been a notable shift among large corporations to align their interests with the emerging cryptocurrency market. Companies like IBM, Intel, and Amazon, to name a few, are all integrating blockchain into their business dealings. Thus, while some may believe Bitmain’s pending IPO application seems ill-advised, if all goes as planned, it will be one of many publicly-traded corporations that find value in engaging with emerging technologies to remain relevant and attract a new age of technology-focused investors.

Bitmain Technologies – A New Age of Investment Amidst a Pending IPO

Juul, a widely popular e-cigarette startup, is valued at about $16 billion. However, many Silicon Valley investors are wary of investing in the company due to its alleged practice of marketing to young people.

FDA Commissioner Scott Gottlieb has deemed youth e-cigarette use an “epidemic,” and in September announced an initiative against retailers for allegedly selling e-cigarettes to minors. Data shows a 75 percent increase in e-cigarette use among high school students this year compared with 2017. On October 2^nd, the FDA conducted a surprise inspection of the Juul Labs headquarters, seizing over a thousand documents it said were related to the company’s sales and marketing practices.

Juul has faced public criticism from Silicon Valley executives, including David Burke, chief executive of Makena Capital Management; Om Malik, partner with True Ventures; and Bradley Tusk, head of Tusk Ventures. However, many investors have willingly contracted with other nicotine start-ups, such as Lucy Nicotine and Ro, which specialize in “hip” nicotine gum. Further, venture capitalist firms are generally more willing to invest in cannabis companies as well.

In some ways, the skepticism with which investors approach Juul reflects the ethical and moral boundaries venture capitalist firms must draw in this day and age. Indeed, firms are likely aware that they are losing big on potential profits that could be earned by investing in Juul, as Juul’s sales now amount to more than half of all e-cigarette sales. But, with the widespread outrage surrounding the product in recent months, those who did invest in Juul have faced significant criticism.

Venture capitalist firms have seemingly deemed it a safer bet to invest in nicotine gum, and even cannabis products. Nicotine gum is typically associated with efforts to quit smoking, as opposed to Juul, which has the aura of a sleek, hip drug. Similarly, cannabis has entered the wellness industry, and many cannabis companies market their products with an emphasis on its health benefits. It is likely easier for investors to square their moral obligations with “drug” companies whose products are marketed to promote health and wellness, as opposed to those with a stigma of taking advantage of youth addiction. Juul is apparently aware of this, as the company has begun to tailor its marketingpractices to try to curb youth engagement and instead focus on the benefits of Juul for smokers looking to quit.

Silicon Valley Wary of Investing in Juul

On Wednesday, October 10, following the conclusion of an anti-trust review, the Department of Justice gave CVS Health a conditional go ahead to acquire health insurance giant Aetna in a $69 billion deal. CVS’s acquisition of Aetna marks the largest ever American health insurance deal. While the Justice Department said that the initial merger plan could have proven harmful to competition, the acquisition could go forward safely so long as Aetna sold of part of its private Medicare prescription business.

The CVS-Aetna merger is the latest example of large-scale consolidation occurring in the health care industry. Just last month the Justice Department agreed to Cigna’s takeover of CVS competitor Express Scripts. Likewise, major health insurers Anthem and UnitedHealth Group have either implemented or made plans to establish their own in-house pharmacies. As a result, these massive healthcare conglomerates plan to integrate a wide array of services, extending far beyond insurance and running pharmacies.

This development has concerned a number of professional groups and consumer advocacy organizations. Many of the critics of the latest CVS-Aetna deal reference the negative consequences of similar recent mergers. These organizations claim that such massive acquisitions have left consumers with higher medical bills and reduced choices. One such group is the Consumers Union, a consumer advocacy organization. The Consumers Union has stated that mergers like CVS and Aetna’s will lead to fewer major players dominating the consumer health industry, pushing out smaller players. Further, the Consumers Union predicts this will create reduced competition and accordingly higher prices.

The American Medical Association has also come out against the merger. According to AMA president, Barbara McAneny, the AMA has been relentless in attempts to prevent the merger. McAneny claims that the AMA has already presented empirical evidence to regulators demonstrating that the merger would prove harmful to patients. Chief among the AMA’s concerns are potential increases in costs for out of pocket medical expenses and rises in insurance premiums.

CVS and Aetna leaders have suggested otherwise. They claim that the merger will allow for more comprehensive and effective treatment, as well as reduced prices. CVS CEO Larry Merlohas suggested that the deal could result in the prevention of future health problems before they occur due to the highly integrated format CVS and Aetna would offer. Further, Aetna CEO Mark Bertoloni has emphasized that the merger could help customers stay on their medication and perhaps even assist patients that have difficulty showing up for medical appointments. Both companies have emphasized a focus on improving local and community health.

CVS Health and Aetna Merger Approved by DOJ

This summer, telecommunications juggernaut AT&T announced the close of an $85.4 billion acquisition of Time Warner. A federal judge approved the merger, spurning government attempts to prevent the transaction on the grounds that such a deal would constrain consumer choices and lead to greater prices for television and internet services. The merger solidifies AT&T as a powerhouse in the telecommunications and media industries, granting the company an expanded media and entertainment portfolio.

This increasingly forms the future landscape for media, whereupon media executives oft claim “content creation and distribution must be married” in order to compete against large technology companies such as Amazon and Netflix. These are but two entities that pour billions into producing their own original shows that users can easily stream, placing constricting pressure on traditional media providers. As a counter against this, the AT&T and Time Warner merger grants AT&T new revenue streams to tap into, as AT&T can now combine its subscriber data to Time Warner’s networks and sell targeted advertising at a higher price.

In the wake of the merger announcement, a series of other mergers have been prompted in the media industry. Other goliaths in the industry closely followed the case. Comcast, for one, held off on bidding against Walt Disney Company for 21^st Century Fox’s assets, until after the trial decision was handed down. Afterwards, they slammed down an all-cash offer worth $65 billion. This illustrates the heightened burden felt by traditional providers, in needing to expand, in order to survive against Silicon Valley technology companies.

This story is far from over, however. Though the Justice Department did not seek an injunction to prevent the transaction, they have appealed the decision handed down by the federal court judge. The government maintains that the federal judge who presided over the case failed to account for “mainstream economics,” ignoring considerations about how companies negotiate and seek to maximize profits. Until the case is resolved, AT&T has reported it will manage Time Warner’s networks as a separate business subsidiary. The initial defeat of the government’s antitrust claim leaves questions as to how effectively the Justice Department may prevent large corporate consolidation in the future and whether this will prompt more big business acquisitions.

Implications of Potential AT&T Acquisition of Time Warner

With the recent boost in technological advances, it is no surprise automated vehicles (AVs) are slowly but surely making their way to the forefront. The National Highway Traffic Safety Administration(NHSA) is reconsidering the necessity and appropriateness of some 75 current safety standards amidst the call for exemptions of requirements purportedly only relevant when humans are driving, such as steering wheels and mirrors.

AVs will certainly impact the approximate 15.5 million U.S. workers currently using cars or involved in the production of cars for occupational purposes. For certain types of industries, including truck drivers and taxi cabs, AVs may ultimately eliminate jobs and diminish income capacity. Still, some analysts predict that in the near future AVs will create the innovation needed to shift the workforce and workforce demands in a positive light, so that substantial changes in these industries result in new types of output activity. By creating new needs and new skillsets, the introduction of these vehicles might create unique opportunities for human drivers to work alongside them.

But the mark of AVs also ventures into uncharted legal territory, as important differences in humans and machines could change how we think about accountability in the law. Where humans use judgement to make decisions that effectively break laws, such as swerving into the next lane to avoid a car door opening, automated vehicle technology may not have such luxury. And if given such capacity to disobey the law in emergencies, who will be held liable when accidents occur at the hands of the machine? While our laws are rooted in morality, reasonableness, and prohibitions, such principles do not squarely apply where a machine does not have equivalent capability. Therefore, both foreseeable and unforeseen consequences of integrating automated technology will consistently affect our societal, legal, economic, and political landscapes.

Whether we are prepared or not, automated vehicles are coming and bringing both the potential for great benefits and unintended effects that will change our understanding of the world around us. What does all of this mean for human drivers? We have yet to know. It does, however, present an opportunity to get ahead of all the issues sure to surface from the use of the technology.

The Inevitability of Automated Vehicles Brings Hope, Uncertainty, and Many Questions

Last June, Senior District Court Judge Richard Leon delivered a blistering decision on the AT&T-Time Warner case. Judge Leon concluded that the Justice Department failed to show that the merger of the two behemoths would violate antitrust law by raising prices and hurting competition.

Judge Leon specifically criticized the Department’s top expert witness, U.C. Berkeley economist Carl Shapiro. Judge Leon rejected Shapiro’s argument that a post-merger AT&T would have leverage over rivals on the ground that such an argument was based on thin evidence at best. Judge Leon’s opinion helped the merger move forward — or at least pushed the case to the D.C. Court of Appeals and possibly into the fateful hands of liberal judges.

Typically, liberals and progressives oppose mega mergers like that of AT&T-Time Warner. For example, Senators Bernie Sanders and Elizabeth Warren moved to shut down the merger prior to Judge Leon’s opinion. They claimed that a massive content creator, comprised of phone, internet, and TV services, would hurt consumers. However, political lines were blurred early on when the conservative Department’s division chief, Makan Delrahim, opted to take on the case. Now, the merger could be in the hands of three liberal judges who have the power to aid the Department’s case in the D.C. Court of Appeals.

The Department is appealing Judge Leon’s lengthy decision on the ground that he, along with the district court majority, ignored the government’s main argument — namely, that Time Warner would have added bargaining power over rival distributors that pay for its programming. The decision will undoubtedly determine the future of mergers between media and telecommunication companies for years to come.

Liberal Judges May Lend a Hand to Justice Department in AT&T Case

Bird, a dockless scooter-sharing company, was founded in 2017 in Santa Monica, CA. Since then, Bird has placed more than 1,000 scooters in 22 U.S. cities and the company announced that customers had taken more than 1 million rides in the past year. This past June, Bird announced that it raised more than $400 million in funding and is valued at around $2 billion.

While Bird has seen astounding growth in such a short period of time, they also have faced issues in regard to safety. In September, over 20 scooter accidents, including pedestrian injuries and vehicle collisions, were reported in Indiana alone. While many riders understandably feel unsafe on the street next to cars, pedestrians feel similarly unsafe with Bird riders sharing the sidewalk with them. Bird is weighing their unprecedented growth with the fact that many major cities continue to decide if the public safety concerns will allow for the service to continue. Already, San Francisco, Denver, and parts of Los Angeles, have opted to ban the scooter-sharing service until new city regulations have been passed to ensure the safety of its citizens.

Despite these concerns, Bird has continued its expansion to international markets. Bird already has scooters in Paris, Brussels, Tel Aviv, and Vienna, and recently announced that it will soon enter Mexico City and Brazil as well. Latin America could be a major frontier for Bird. Company officials stated that the region has much less regulatory hurdles for scooter companies as opposed to car ride shares, such as Uber. Further, while it does not have specific permission from local government, the company claims to adhere to local regulations and cites that the cities already have other scooter-sharing services available.

While companies like Bird continue to receive major funding and chances for further growth in new regions, they also face increased competition and regulatory issues. These obstacles could prevent Bird from living up to the lofty expectations created by their evaluations. Excitement regarding convenience and low pricing may continue to fuel Bird’s growth, however, a communal waning of interest and an oversaturated U.S. market could prove detrimental to the company’s long-term sustainability. Expansion into international cities and territories may help to boost revenue and growth as the U.S. market becomes more accustomed to the ever-present scooter found parked on the sidewalk.

Scooter Company, Bird, Enters Latin American Market

Offsetting its recent loss in a bidding war against the Walt Disney Company for control of 21st Century Fox, Comcast successfully won its September 22 bid to acquire Sky—a British media and telecommunications broadcaster. The takeover comes shortly after Disney outbid Comcast in July in the fight over the acquisition of Fox. With its $40 billion winning bid ($22.57 a share) for Sky, Comcast is giving Fox and Disney a taste of their own medicine.

Comcast’s victory presents a devastating blow to Fox. Fox holds 39 percent of Sky and Fox’s Executive Chairman Rupert Murdoch had always hoped to take over the rest of Sky. In the growing landscape of video streaming, players like Netflix and Amazon are pushing viewers to abandon traditional cable television. As a result, traditional media companies like Comcast are strengthening their efforts to stay afloat. With its acquisition of Sky, Comcast will not only gain a stake in the streaming business through Sky’s streaming option Now TV, but will also be able to diversify its business across international borders. Sky boasts an impressive and crucial twenty-three million paying subscribers across five European countries. Its strong portfolio in those markets includes original programming, a news channel, exclusive partnerships with HBO, Showtime, and Warner Bros. Studio, and an invaluable deal with the English Premier League of soccer. As a traditional broadcaster, Comcast will greatly benefit from both Sky’s subscriber base and its creative content portfolio.

Comcast is not the only media company making bold moves to gain market share. The age of video streaming is marked by two distinct features: a subscription-based model of membership and the creation of original content. Since beginning to develop its own content in 2012, Netflix has proven to be a formidable player in successfully harmonizing the two features, creating a $142 billion empire. With Netflix’s success, competitors will undoubtedly have to intensify efforts to focus on building competitive advantages across both features while still remaining profitable. From Amazon Video’s distribution of its own original content for Prime subscribers to Apple’s upcoming slate of original television shows, new players are targeting Netflix’s market dominance. And for older companies like Comcast that are not built on subscription-based models of streaming original content, expensive mergers and acquisitions may be a necessary strategy for remaining competitive.

Comcast Fights Back

After losing roughly $7 billion in value in late September, Tesla’s stock surged recently in response to Elon Musk’s settlement with the U.S. Securities and Exchange Commission as well as promising Model 3 production numbers. However, many remain worried about Tesla’s ability to pay its debts. Despite Musk’s ability to sell equity investors on the future of Tesla, the company’s serious debt problem has plummeted Tesla’s bond price to a record low.

In its early years, Tesla took on a substantial amount of debt to achieve a sizeable advantage in the electric car space. Tesla was able to successfully seize control of the electric car market and became the most valuable car company in America. Nevertheless, Tesla has yet to turn a profit. Tesla’s newest car, the Model 3, was intended to boost profitability as a result of mass production and relative affordability in comparison to the Model S.

Unfortunately, Tesla has failed to meet Model 3 delivery expectations. Meanwhile, more than $9 billion of Tesla’s debt is scheduled to mature before 2025, $2.7 billion of which will mature over the next two years. Still, Tesla’s cash is rapidly depleting. Tesla has about $2.7 billion on hand and a burn rate of about $6,500 a minute as the company attempts to ramp up production and delivery of the Model 3. Moreover, Tesla is particularly susceptible to financial distress because the electric car business is highly competitive and capital-intensive.

What should the company do? It’s unlikely that Model 3 profits will be substantial enough to simultaneously pay off the company’s debts, maintain market share, and finance Elon Musk’s vision for the future. Given Tesla’s current credit rating, leveraging the company would be extremely expensive as a result of hefty interest payments. Instead, Tesla should capitalize on the recent surge in stock price and renewed sense of optimism among equity investors by selling a sizable chunk of the company to pay the company’s debts, finance its future, and stave off bankruptcy.

Tesla Forced to Make Tough Choices as Debt Comes Due

Thomson Reuters (NYSE: TRI) recently announced it would return $10 billion to shareholders after selling the majority position of its Financial & Risk (F&R) unit to private equity firm Blackstone (NYSE: BX). Of that $10 billion, representing the majority of the $17 billion sale price, Thomas Reuters announced it would use $9 billion to buy back shares, largely in connection with a substantial issuer bid (SIB). While some stockholders might be rejoicing, their exuberance may be misplaced.

Thomson Reuters is not alone in its desire to give back to its investors. Corporate tax cuts and steady earnings have prompted record stock repurchases with no indication of slowing down. By repurchasing shares, companies increase net earnings per share by decreasing the total number of outstanding shares. For instance, Apple (NASDAQ: AAPL) repurchased $112.8 million shares in the second quarter, adding five cents to its earnings. As a result, companies may hope to make their stock more attractive to potential buyers, though the extent to which higher earnings per share are driving stock prices is not without contention.

Not everyone agrees buybacks are a good idea. Critics of stock repurchases argue that buybacks are ineffective and irresponsible. By paying out surplus capital to shareholders, companies may miss out on critical investment opportunities they need to stay competitive. Moreover, stock repurchases that place a premium on the purchased stock, as with an SIB, may be hugely inefficient, overvaluing the company stock. Buybacks may also present a moral dilemma regarding the duties a corporation has towards its shareholders and the duties it owes its employees or society as a whole.

Granted, there are good reasons to like buybacks. Proponents argue they reward investors who carry the risk associated with holding the stock. In addition, stockholders may have a strong sense of how the company’s money should be spent and should only want management to invest that capital if it can produce a higher return with it than they can do with it themselves.

Still, even for those who subscribe to the notion that a corporation’s first priority is its shareholders, it is worth pondering what effect, if any, repurchases of this size and on this scale may have on how directors are expected to manage their money in future markets.

Thomson Reuters’ Blackstone Deal Raises Questions for Shareholders in an Age of Buybacks