WHAT’S INSIDE

👇️ Todays’ Feature: Why Nations Are Investing In Sovereign AI

• Tech News: Jobs data, AI Education, Tariff Case, SEC Spring, Google Breakup

• Company Watch: Real Intent x RealScout, Polymarket, IQM, Exa, ID.me

• Buzzy Tools: Latest Buzzy tech, AI and financial tools

• Deep Tech: The latest in deep tech, biotech, futurism and more

• Space Tech: Latest news in the space race and aerospace tech

• Crypto: Blockchain and crypto policy and startups or protocols to watch

TECH IN THE NEWS

Markets — U.S. equity and bond prices rose Thursday as soft U.S. jobs data boosted hopes for an interest rate cut from the Fed later this month. That may be determined by today's critical August employment report.

$1.2B+ for AI Education — Big tech commits over $1.2B including: Google ($150M to AI literacy in US high schools), Amazon ($30M to train 4M in AI skills by 2028) & NVIDIA ($25M targeting 1M students, boosts AI literacy in K-12).

Chip Tariffs — President Trump announced coming substantial tariffs on chip imports while exempting companies like Apple that commit to US manufacturing. He also appeals to the Supreme Court to maintain tariffs deemed beyond his authority.

SEC Spring — The SEC's Spring 2025 Regulatory Agenda focuses on innovation, capital formation, and investor protection, including potential crypto asset rule proposals to reduce compliance burdens, rethinking the Consolidated Audit Trail.

Google Breakup — The tech giant must end exclusive search deals and share certain data to curb anticompetitive practices, as ordered by a federal judge but doesn’t have to divest Chrome. The ruling could influence its ad rech antitrust case.

UK’s AI Fortress — A high-security supercomputer facility in Bristol, England, boasts anti-crash barriers and surveillance. Operated by AI experts, it has a formidable presence akin to "Jurassic Park gates," highlighting its critical role in AI.

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Why Nations Are Investing In Sovereign AI

Vivien Wang

As AI continues to eat the world, the world itself is increasingly questioning the US dominance of the sector. Many nations are accelerating efforts to develop sovereign AI models, and investing heavily in local alternatives to US big tech AI. Their goals are to gain more control over what is increasingly deemed critical technology economically, geopolitically, and from a national security standpoint. 

Why is Sovereign AI Being Developed? 

Sovereign AI refers to artificial intelligence systems built and governed by national entities, often emphasizing local language, regulatory compliance, and national security. Developing such systems would allow countries to ensure that data stays within their borders, protecting both their constituents' interests and guarding against foreign corporate influence. Sovereign AI also provides easier access to tailored solutions for each country’s government, which could also prove helpful in context of the rise of AI in defense tech that we discussed last week. 

Despite these ambitions, US-based companies remain dominant; OpenAI’s GPT-4o, Google’s Gemini, and Anthropic’s Claude lead in overall model size, performance, and global reach. Most nations lack the technical depth and commercial leverage to rival US players directly, but heavily value transparency, data sovereignty, and public trust and protection – qualities sometimes lacking from the private sector, especially with the US’s looser AI regulations. 

Global Sovereign AI Developments

On Tuesday, Switzerland launched Apertus, an open-source LLM designed as a more transparent alternative to ChatGPT. The team of Swiss universities behind the model have stated it isn’t intended to compete with the US leaders; instead, it’s meant to be a safer tool for scientific researchers and commerce. Its open-source nature allows the public to see transparently what goes into response generation, thus hopefully easing concerns and building trust among its users. 

Although Swiss industry and banks are praising Apertus for its focus on data privacy and compliance with strict European regulations, many are still deploying models from OpenAI and Microsoft, preferring speed and scale. This raises questions for homegrown AI – it may meet regulatory requirements easier, but limited practicality could also result in limited adoption. 

South Korea is another nation fervent in its sovereign AI efforts, with many companies striving to fulfill Korea’s AI demands through models tailored to Korean language and culture. A Korean initiative is led by five major consortia, including LG AI Research, SK Telecom, Naver, Upstage, and NCSoft, that are all developing competing LLMs for the country. After the teams are evaluated, two will be chosen as the final developers. LG AI Research’s Exaone 4.0 seems to be the main contender, performing well against specialized benchmarks and ranking highly on the global Artificial Analysis Intelligence Index. 

While not strictly aimed at fulfilling France’s desire for fully sovereign AI, Mistral AI is working closely with the French and EU governments and quickly becoming a major global player, bolstering France’s domestic AI capabilities along the way. On Wednesday, it was reported that Mistral is finalizing a massive $2.3B funding round, bringing its valuation to $14B. Mistral boasts open-source models and its Le Chat chatbot, together with an $11B deal for a gigawatt-powered AI supercomputer, aim to challenge American scale deepening capabilities. Mistral holds close partnerships with the French government and pan-European data centers, underscoring strategic moves towards infrastructure dependence. 

The UK also sees opportunity within sovereign AI in the form of its newest and biggest supercomputer, Isambard AI. Commissioned in August 2023 in the wake of the then prime minister’s projection of Britain as a tech superpower, Isambard went into operation in July of this year. As the 11th-fastest supercomputer, it is an early success for British AI infrastructure, but still lags behind leaders and other middle powers. Even with a relatively abysmal amount of money allocated towards AI investment, Britain still sees a chance to win in the unpredictable AI race through nurturing AI talent– it’s a world leader in machine learning research. 

It’s difficult to discuss sovereign AI without mentioning China, whose domestic models like DeepSeek-R1 are demonstrating capabilities on par with top US models.  July’s AI action plan announcement served to stake China’s flag as a sovereign AI leader and telegraph its intentions. 

The gap of previous years has been narrowing for some time, and national strategy has shifted accordingly from catch-up to global leadership. China’s AI policy now blends economic incentive with an applied AI strategy actively encouraging domestic models to be widely used across society to improve efficiency.

As we covered on Tuesday, Xi’s comments at the Shanghai Cooperative Organization summit were an overt shot across the bows, effectively putting US AI domination on notice. On Wednesday, China’s Victory Day parade also served as a protest against US power and influence. These shows of military and tech power, along with China’s recent governance plans, tie AI projects directly to national defense and strategic competition with the US. 

Weaning The World Off Big Tech 

AI isn’t the only area in which nations are trying to separate themselves from US influence. Yesterday, Nepal’s government announced an immediate ban on Facebook, X, YouTube and other social media platforms for failing to comply with the country’s registration requirements. While this effort at digital sovereignty and separation from foreign tech influence could be with the ultimate goal of the people’s protection in mind, critics argue that such bans stifle free expression and harm creators. The EU’s Digital Services Act is also under attack from Trump and the FTC as anticompetitive, but the EU is holding fast on digital sovereignty for now.  

Trump’s Trade Policy And Possible Outcomes

The surge in national AI initiatives is an explicit response to US dominance, but it’s unclear yet whether it will effectively counter the consumer-first strategy that has seen US big tech dominate in the web and web 2.0 tech cycles. These developments reflect policy cycles, where nations invest into AI not only for technological progress, but also to assert regulatory control and ratchet up bargaining power abroad. 

The lines between tech, policy, and defense are blurring further, as Trump continues to push for US semiconductor dominance by doubling down yesterday on imposing tariffs on chip imports. He assured companies like Apple of safe haven if they commit to US manufacturing by way of exemptions and protection from the trade war. This assumes he is in control and has the power to do so, which is far from clear. 

With Trump’s policy, combined with mounting foreign efforts for sovereignty, the world could become increasingly “multi-polar” as Xi and Putin have predicted. A technologically and politically fragmentation of the global AI market into power blocs would be a radical time of transition as the reshaping of both the power map and the economy plays out. Times of transition bring both precarity and opportunity for savvy investors, so emerging economies and non-US companies could be worth a look. 

COMPANIES TO WATCH

Apple — Partnering with Google to integrate Gemini AI into Siri, enhancing iPhone user interaction. This addresses AI strategy delays to compete with OpenAI, while offering Google access to a vast user base. Apple maintains personal data.

OpenAI — Increased its employee stock sale to $10.3B at a $500B valuation, reflecting confidence before a potential IPO. Also acquired Statsig for $1.1B, appointing Vijaye Raji as CTO of applications to boost enterprise offerings.

Anthropic — Closed a $13B Series F at $183B. Led by ICONIQ, co-led by Fidelity and Lightspeed, Its AI revenue soared from $1B to $5B in eight months, serving 300,000+ businesses. The funding will enhance capacity, safety, and global expansion.

Mistral AI — The French AI startup is approaching a $2B+ investment, boosting its valuation to $14B to challenge Silicon Valley with its open-source AI solutions.

Real Intent x RealScout — A strategic partnership introduces the Listing Engine, enhancing lead generation for real estate agents by integrating exclusive lead data with automated nurturing tech. 8% better lead-to-appointment conversion rates.

Polymarket — The prediction market platform has gained CFTC approval for its U.S. launch. The company acquired QCX, a derivatives exchange, to enhance its services, with the CFTC waiving certain data regulations to facilitate this expansion.

IQM — Finnish quantum computing startup has become a unicorn with a $300M Series B to expand into the U.S., enhance its quantum hardware and software, and deploy 150-qubit systems, while considering local U.S. assembly to drive sales.

Exa — A San Fran startup developing an AI-centric search engine secured a $85M Series B at a $700M valuation led by Benchmark, a major bump on previous rounds.

ID.me — Raised a $340M Series E to enhance digital identity solutions and combat AI-driven fraud. Prevented $270B+ in unemployment fraud during the pandemic, serves 152M users and aims to strengthen its leadership in secure digital id.

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BUZZY TOOLS

Buzzy Tech Tools To Watch & Use

OpenAI — ChatGPT Projects expands to all, with memory mgmt, custom folders.

Amazon — Launches Lens Live for instant AI visual product search, shopping help.

X — Expands XChat encrypted messaging to non-premium, rivals Signal, WhatsApp.

ElevenLabs — Generate, modify text-based sound effects for film, gaming, social.

PayPal/Venmo — Early access AI-powered browser Comet +1 yr free Perplexity .

DeepL Agent — Autonomous AI for business tasks in sales, marketing, & finance.

LinkedIn — Rolls out AI-powered hiring assistant globally. OpenAI launches a rival.

BUZZY TECH

The Latest Deep Technology & Trends To Watch

OpenAI for Science — GPT-5 aids scientific discovery by automating research.

Biological Qubits — Quantum sensing inside cells for advanced imaging studies.

EHang VT35 — New long-range electric air taxi enhances range and speed.

GE Aero x Beta — $300M investment boosts hybrid-electric aircraft.

Spinal Injury Repair — 3D-printed scaffolds & stem cells restore rats movement.

CRYPTO WATCH

SEC & CFTC Crypto Initiative — The SEC and CFTC are collaborating to streamline trading of spot crypto assets. It aims to boost regulatory clarity and innovation, offering guidance on margin, clearing, and market monitoring for transparency.

Uniswap's DAO Push — The Uniswap Foundation leads 18 crypto organizations urging the Treasury Secretary for federal DAO compliance guidance, advocating for Wyoming's DUNA framework. Seeks bipartisan support for clearer regulation.

Uniswap's DUNI — Uniswap established DUNI as a legal entity in Wyoming under the DUNA structure. This aims to enhance governance, legal protections, and operational capacity, positioning Uniswap Governance as the largest DAO.

Caliber's Crypto Move — Caliber unveils a digital asset strategy focusing on LINK tokens to boost balance sheet and liquidity. A Crypto Advisory Board will oversee the plan, leveraging Chainlink's tech. Funding comes from cash reserves, equity.

Utila's Crypto Surge — Utila raised a $22M Series A expansion led by Red Dot Capital Partners, tripling its valuation in six months. The fintech's platform has facilitated over $60B in secured crypto transactions, supported by 200+ institutions. .

Kite's Flight — Kite secured $18M in Series A funding, co-led by General Catalyst and PayPal Ventures, to enhance its Kite AIR platform. With a total of $33M raised, Kite aims to be the default stablecoin payment layer for AI agents.

SPACE_RACE

SpaceX_Falcon 9 launches were approved to double to 120 launches per year

NASA Nuclear Battery_Americium-241 extends battery power life to 433 years

Amazon Project Kuiper_JetBlue to install LEO connectivity by 2027

Orbital Paradigm_Minimal capsule aims to reduce reentry costs

Moon Race_Experts urge NASA Artemis to counter China's moon race progress

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