Happy Monday, Munchers! 🙏

Hope you lot had a lovely weekend. Bless up, and have a great day.

As always, here is your daily dose of the news that matters, from Wall Street to Dalal Street - in 5 minutes and 17 seconds.

Yesterday, TikTok’s losses ticked up, Huawei ditched Dubai for Saudi, and the big boys of the banking world got sued. 🔥

Let’s dive in.

What’s hot, what’s not?

Market Commentary

• Investors are loading up on insurance against a fresh round of turmoil in the US banking sector. Earnings season is gonna start soon, so lenders are gonna be revealing just how much the SVB saga squeezed their margins.

• The options market is saying that price swings in bank stocks may be up to 3x more than normal.

• Not much else. The hotshots on Wall Street had a calm Easter weekend. 🤷🏻

Story Roundup

1 - Bytedance boosted ahead to record profit. 💸

TikTok’s tech titan Bytedance is now the most profitable Chinese “startup”.

They raked in a staggering $25 billion in pure profit over the last year.

Numbers like that give a gut-punch to China’s other tech giants - Alibaba and Tencent.

Bytedance has been eclipsing them by scale for a long time, and just overtook them in profit.

The most interesting thing though - the TikTok business unit was responsible for big losses. Showing the world cat videos and badly edited memes costs them $9 billion a year, but it’s a massive profit engine for the future.

TikTok’s growth is the most explosive out of any social network that we’ve seen in a long time.

The average TT user spends 95 minutes a day on the app. Multiply that by their 1.53 billion active users, and you have a BIG number.

Time is money. 💰

2 - Huawei puts some roots down in Saudi. ✈️

For the longest time, Saudi soil was neglected for Dubai’s deserts.

Cut to today, and it looks like the Middle East’s center of power might be shifting.

Huawei wants to put down their headquarters in Riyadh - which is a perfect example of why Saudi has been pushing so hard to open themselves up.

Saudi also announced that their government will be forbid from working with private companies who DON’T have a regional office in the Kingdom.

They’re also forging deeper ties with every single Eastern heavyweight - India, China, and Russia.

The game is no longer about developed and developing economies.

It’s about ascending and descending ones. 🚀

3 - Wall Street’s heavyweights take gut punches. 🥊

KPMG, Goldman Sachs, Bank of America, and Morgan Stanley.

That sounds like a finance major’s list of job applications, but it’s actually a list of businesses that just got sued over the collapse of SVB.

KPMG was SVB’s auditor, and the rest were responsible for underwriting deals and selling stakes to investors.

These guys “misrepresented the strength” of Silicon Valley Bank’s balance sheet and “concealed the magnitude” of the risks taken by buying SVB stock.

Keep in mind, 75% of Wall Street “analysts” had a Buy rating on SVB just one week before the saga happened.

KPMG’s auditor report was also “silent” about SVB’s ability to keep the lights on in the office.

Every dog has his day. 🙈

4 - a16z stays hopeful. 😅

Forget the funding winter, forget the market downturn, forget interest rates.

One of the world’s biggest tech VCs thinks that there is still room for a crypto boom.

Andreessen Horowitz is gonna continue tailoring their crypto funds toward “new opportunities”.

a16z has dug their claws deep into the world of crypto - which meant that 2021’s beautiful outperformance ultimately resulted in 2022’s crypto chaos.

They want to put their big bucks toward businesses that are building consumer-facing products.

And that’s the biggest problem with “web3” - the user doesn’t care about whether your product is “blockchain-enabled”, he just cares about his work getting done faster, easier, or cheaper.

5 - Eth gets ready to go Shanghai. 🇨🇳

April 12 is gonna be a pretty nice milestone for crypto bros across the world.

Ethereum is gonna go thru it’s “Shanghai” update. It’s the world’s most commercially important crypto platform, and this one is a biggie.

Up until 6 months back, Eth relied on a cost-intensive, energy-intensive, and resource-intensive process to proof transactions.

This was called Proof-of-Work, where a computer had to solve a crazy difficult maths problem to verify that a transaction happened.

All of this maths-solving made Ethereum super expensive to use, so the blockchain shifted to a Proof-of-Stake system of verifying transactions.

Here, users could lock their money up with the blockchain to verify transactions and get some income in return.

About 16% of Eth supply worth $37 billion has been “locked up”. And this Shanghai update is gonna change exactly that.

This “locked up” money will now be unstuck for investors.

But you don’t care about that.

This is what it could mean for you - investors who’ve been burned by the turmoil in crypto markets might want to pull their big bucks.

If some big Eth holders run for the hills, it’s gonna be bye-bye crypto for a while.

RIP Crypto bros. 💀

Hope you enjoyed this issue of Market Munch. If you’ve got any feedback - good or bad (😏) you can hit reply to this email and I'll get a ping in my inbox. Thanks a ton for reading!

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Cheers, and have a lovely day. 🙏

- Aryaansh ⚡