Big Tech Explores Stablecoin Payments

CRYPTO
Big Tech Explores Stablecoin Payments

Apple, Airbnb, X (formerly Twitter), and Google are reportedly in early talks with crypto firms to integrate stablecoins into their payment systems, according to Fortune. These digital tokens, pegged to fiat currencies like the U.S. dollar, processed over $27.6 trillion in payments in 2024—outpacing Visa and Mastercard.

The surge in interest follows the explosive IPO of Circle, the issuer behind the USDC stablecoin, whose shares soared over 40% Friday after more than doubling on its debut. Apple is exploring stablecoin use in Apple Pay, while Airbnb is assessing the technology to reduce card network fees. X is also said to be in discussions with Stripe to enable crypto payments.

Analysts say the growing embrace of stablecoins has been bolstered by regulatory optimism. A proposed bill—the GENIUS Act—may offer clearer rules, and political shifts like Donald Trump’s re-election have eased corporate caution around crypto adoption.

TECH
Tesla Board Silent Amid Chaos

Elon Musk’s recent public attacks on Donald Trump — including calls for a new political party and controversial Epstein claims — triggered a media storm and a 14% drop in Tesla’s stock, wiping out $150 billion in market value. While such outbursts would likely get any other CEO fired, Tesla’s board has remained silent.

Governance experts say the board is too close to Musk, lacking independence and the authority to act. With Musk holding 22% of voting power and multiple directors having personal or financial ties to him — including his brother — removing him is unlikely. Despite reports of a potential CEO search, Tesla denied any such move.

Analysts and shareholders warn Musk’s political distractions could jeopardize Tesla’s future, especially if Trump eliminates EV tax credits. Yet governance experts remain skeptical the board will intervene, citing a long history of inaction. As one put it, “This board won’t do anything — they never have.”

TECH
Musk’s Trump Clash Rattles xAI Funding

Morgan Stanley recently pitched investors on a $5 billion debt sale for xAI, Elon Musk’s AI venture. The call focused on building data centers and scaling Grok, xAI’s chatbot. But as executives spoke, Musk ignited controversy online — accusing Donald Trump of ties to Jeffrey Epstein and political ingratitude — overshadowing the pitch.

The feud now threatens xAI’s financing plans. Investors worry Trump’s retaliation could cut federal support to Musk’s businesses, impacting Tesla, X, and xAI. Tesla shares dropped 7% Thursday, and X debt traded down to 95 cents on the dollar before rebounding slightly.

Morgan Stanley may now need to offer higher interest or discounts to complete the deal. xAI is also planning a $300 million equity raise at a $113 billion valuation, even as it burns through cash, posting a $341 million Q1 loss.

TECH
Broadcom Eyes AI Growth

Broadcom projected third-quarter revenue of $15.8 billion, slightly above Wall Street’s $15.71 billion forecast, fueled by demand for AI and networking chips. Despite the positive outlook, shares dipped 3% in premarket trading after surging nearly 30% over the past month — a sign that investors expected even stronger guidance amid the AI boom.

The company, a critical supplier of custom processors for firms like OpenAI and Google, highlighted the rollout of its Tomahawk 6 networking chip, which doubles performance and enhances data center efficiency. CEO Hock Tan said AI chip revenue is set to accelerate to $5.1 billion in Q3, marking ten straight quarters of growth.

Still, Broadcom’s non-AI chip business remains sluggish, nearing the bottom of the cycle. Overall Q2 revenue rose to $15 billion, just above expectations, with the semiconductor segment growing 16.7% to $8.41 billion. Despite strong fundamentals, investor sentiment remains cautious in the overheated AI sector.

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.