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A $300 Trillion Oopsie
00:19:38
So, a huge, huge, like bigger than the entire world’s GDP fat finger episode in the world of stablecoins. Zuck has poached another one from Apple. Potentially huge state sponsored hack of a key infrastructure company. The most interesting new phone concept I’ve seen in a while. And are we in an AI bubble episode 72.
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Write home for Thursday, October 16, 2025 I'm Brian McCullough. Today a huge, huge. Like bigger than the entire world's GDP fat finger episode in the world of stablecoins, Zuck has poached another one from Apple. Potentially huge state sponsored hack of a key infrastructure company. The most interesting new phone concept I've seen in a while and are we in an AI bubble? Episode number 72 here's what you missed today in the world of tech Oopsie. Paxos says it mistakenly minted $300 trillion worth of PayPal's PiUSD stablecoin on October 15th on the Ethereum blockchain and then burned the tokens around 20 minutes later, according to Crypt Crypto. Industry observers were baffled Wednesday afternoon when an on chain transaction showed that Paxos, the issuer behind the PayPal branded PI USD stablecoin, minted $300 trillion worth of the tokens on the Ethereum blockchain. A little over 20 minutes later, all 300 trillion PIUSD tokens were burned or effectively destroyed by sending them to an inaccessible network address. For context, $300 trillion is more than two and a half times larger than the entire world's GDP, which is approximately $117 trillion according to the International Monetary Fund. There is also only $2.4 trillion in physical US dollars in circulation per trading economics. It cost just $2.66 in transaction fees to print this gargantuan amount of money. So what happened? It was indeed a fat finger mistake, as several industry observers were quick to speculate on social media at 3:12pm EST, Paxos mistakenly minted excess PI USD as part of internal transfer. Paxos identified the error and burned the excess piusd, the official account for Paxos, posted on X hours after the incident. This was an internal technical error. There is no security breach. Customer funds are safe. We have addressed the root cause. The two previous PayPal USD transactions made by Paxos just hours prior to the error, according to Block Explorer, Etherscan were both for 300 million PIUSD, decreasing the supply in one instance and transferring tokens in the other. It's what led most onlookers to think the mint was more than likely a mistake rather than a malicious attack, which Paxos has now confirmed. PayPal has yet to comment publicly on the error. The moves come as Paxos is seeking a national trust charter with the OCC under the recently passed Genius act, among several other stablecoin issuers. If approved, the charter would allow Paxos to legally conduct business across the United States. If someone with a fat finger error can increase the total supply of a stablecoin by a factor of 120,000, then perhaps regulators should proceed cautiously league with granting that firm with a national bank charter and keys to the payment system Policy director at Better Markets and ex chief of staff to former SEC chair Gary Gensler, Amanda Fisher told Decrypt. Of course, crypto users on social media have had a field day with the dizzying stablecoin mint. Some jokingly suggested the stablecoins were printed to pay off the US national debt of $37.8 trillion, while others repeated the trillions meme that the plasma stablecoin network uses for its branding as the crypto appeared to be broadly laughing at the situation. Others also expressed deep concerns that such a huge mistake could be made by one of the biggest stablecoin issuers in the world. Certainly not a good look to get the decimals wrong when minting stables and not having procedures in place to catch that early, Martin Koppelman, founder and CEO of Crypto Wallet Gnosis, said on X and quoting Aaron Casali. Wasn't the thing about crypto that minting is a very expensive process that required computational power and alignment and it was all public. And if they can just mint $300 trillion at the press of a button, isn't then this just a slow database, no different from normal banking? End quote. And well, this happened again. Mark Gurman says that Apple Executive Key Yang is leaving for Meta now. The thing about this is Yang was appointed as the head of the Answers Knowledge and Information team developing AI driven web search for Siri just a few weeks ago. That team is central to a major Siri revamp planned for March, part of Apple's broader effort to revive its struggling AI operations. The new version of Siri will also include features delayed from earlier this year, such as the ability to tap into personal data to handle more complex requests. The Answers feature in particular was designed to help Apple better compete with OpenAI Perplexity and Alphabet's Google Gemini in the AI powered search market. A space, rapidly gaining traction among both smartphone and computer users. The new Siri is being developed as a joint effort between Apple's artificial intelligence and machine learning group, known as aiml, and the Siri engineering team, now overseen by Craig Federighi's software organization with aiml. Yang was regarded as the most prominent executive working on the new Siri initiative. His exit ranks among the biggest departures from Apple's AI organization this year, a period marked by a steady exodus of top researchers building the company's AI core models. Roughly a dozen member members of that team, known internally as Apple Foundation Models, have departed, including its founder and lead scientist Ruming Pang. He and a number of others also joined Meta, which is building a new group called Superintelligence Labs. Several of the Apple team's remaining members expect many more people to leave in the coming months. End Quote US cybersecurity company F5 has been forced to disclose an attack it discovered on August 9th by Nation State hackers who stole undisclosed big IP vulnerabilities and source code. Quoting Bleeping Computer F5 is a Fortune 500 tech giant specializing in cybersecurity, cloud management and application delivery, networking, or ADN applications. The company has 23,000 customers in 170 countries and 48 of the Fortune 50 entities use its products. Big IP is the firm's flagship product, used for application delivery and traffic management by many large enterprises worldwide. It's unclear how long the hackers maintained access, but the company confirmed that they stole source code, vulnerability data and some configuration and implementation details for a limited number of customers. Through this access, certain files were exfiltrated, some of which contained certain portions of the company's Big IP source code and information about undisclosed vulnerabilities that it was working on in Big ip, the company states. Despite this critical exposure of undisclosed flaws, F5 says there's no evidence that the attackers leverage the information in actual attacks, such as exploiting the undisclosed flaw against systems. The company also states that it has not seen evidence that the private information has been disclosed. F5 claims that the threat actors access to the big IP environment did not compromise its software supply chain or result in any suspicious code modifications. This includes its platforms that contain customer data, such as its CRM, financial support, case management or iHealth systems. Furthermore, other products and platforms managed by the company are not compromised, including Ingenix, F5 distributed cloud services or Silverline System source code, end quote. But in an update, sources are telling Bloomberg that F5 is blaming this breach on state backed hackers from China who used the Brickstorm malware to infiltrate its network for more than 12 months. The US Cybersecurity and Infrastructure Security Agency issued an emergency directive on Wednesday describing it as a significant cyber threat targeting federal Networks utilizing certain F5 devices and software. It warned all federal agencies to update their F5 technology by October 22. The agency warned that nation state hackers could exploit vulnerabilities in F5 products to gain access to credentials and tools that could allow them to move through a company's network, steal sensitive data, and compromise entire information systems. End quote Real quickly, another model to tell you about Anthropic released Claude Haiku 4.5, claiming it offers similar levels of coding performance to Sonnet 4 at 1/3 the cost and more than twice the speed. Quoting TechCrunch in a statement to press, Anthropic CPO Mike Krieger said the Haiku would make new styles of deployment possible in production. For the first time, it's opening up entirely new categories of of what's possible with AI in production environments, with Sonnet handling complex planning while Haiku powered sub agents execute at speed, krieger said, we're giving people a complete agent toolbox where each model has the right combination of intelligence, speed and cost for different parts of the job. The most immediate applications are likely to come in software development tools where Claude code is already commonly used and latency is often a critical factor. In statements provided by Anthropic, Zencoder CEO Andrew Filev described the new version of Haiku as, quote, unlocking an entirely new set of use cases, end quote.
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Partner with Veeam to increase your data resilience and get the right data recovery options for any kind of disruption so you can undo the unpredictable and get your data back so fast you won't even have time to miss it. With Veeam, it's all good. Keep your business running@veeam.com okay, this is the most interesting new potential gadget I've been able to tell you about in a little while. Not interesting like I'm going to try to run out and get one if it ever comes out, but interesting because you know somebody's trying something. Honor is teasing the robot phone, featuring an AI enabled gimbal mounted camera that unfolds from the phone's rear and can shoot photos and video in any direction. Quoting the Verge, the phone, so far only seen in CGI form in a teaser video with no glimpse of real hardware just yet, looks like a typical, albeit thick, smartphone. Instead of an Honor logo, it bears an alpha representing the company's Alpha plan, corporate vision, and the main giveaway that something's up is the chunky camera module split into two parts. From here, a camera arm unfolds with a cartoonish giggle. It really does giggle, at least in the video, revealing that the main camera can flip up to take selfies, but also to shoot from a variety of positions and angles, seemingly moving under its own direction. That would make this a more advanced successor to the likes of 2019's Asus Zenfone 6, which flipped its main cameras up and over to take selfie shots. It looks for all the world, like the mini gimbal camera on top of the DJI OSMO Pocket. Though Honor's video would like to give the impression that it's been imbued with enough intelligence to frame photographs, soothe babies, and gaze in astonished wonderment at the stars above with the robot phone, Honor envisions the future phone as more than just a tool, the company wrote in a press release. It becomes an emotional companion that senses, adapts and evolves autonomously like a robot, enriching its users lives with love, joy and wisdom. We'll find out more about the robot phone, and maybe even get the chance to see it in the flesh when Honor reveals more at Mobile World Congress next spring. The robot phone was Honor's One more thing announcement at the end of a more typical launch event for Honor's two Magic 8 flagship phones, which go on sale in China this month and will launch internationally before the end of the year. End quote and from the concern trolling file, the FT says that 10 loss making AI startups, including OpenAI just between the 10 of them gained around $1 trillion in private market valuation over the past year, fueling concerns of an inflating bubble in private markets. OpenAI, Anthropic and Elon Musk's XAI have seen their values marked up repeatedly over the past year amid a rush to back young AI companies. Smaller groups building AI applications have also surged, while established startups, including databricks, have soared after embracing the technology. US venture capitalists have splashed $161 billion over the year to date on a technology whose promise has not yet been matched by major economic gains that equates to two thirds of their total spend, according to Pitchbook. The bulk of the investment has been funneled to just 10 AI groups. Perplexity, any sphere scale AI safe superintelligence, thinking machines lab figure AI databricks as well as OpenAI, anthropic and XAI that has pushed up their combined valuations by almost $1 trillion, according to FT calculations. Of course there's a bubble, said Hemant Teneha, chief executive of venture capital firm General Catalyst, which raised an $8 billion fund last year and is backed. Anthropic and Mistral Bubbles are good. Bubbles align capital and talent in a new trend, and that creates some carnage. But it also creates enduring new businesses that change the world. Tech has endured boom and bust cycles. The dot com crash in 2000 decimated a generation of Internet companies, and VCs are still picking through the debris left after a software investment frenzy stoked by low interest rates came to a juddering halt in 2022. But the current scale of investment is of a different magnitude. VCs invested $10.5 billion into Internet companies in the year 2000, roughly $20 billion adjusted for inflation. In all of 2021, they put in $135 billion into software as a service startups, according to PitchBook. VCs are on course to spend well over $200 billion on AI companies this year. We have gone from the doldrums to animal spirits in a few months, said an executive at one U.S. investment firm. It's FOMO. Investors are bullish. The technology will open multiple new multitrillion dollar markets, from automated software engineering to AI companionship. AI is a technology which adds a zero to everything, says Samir Dholakia, an investor at Bessemer Venture Partners. But there are concerns that indiscriminate spending has made valuations unrealistic. Startups with around $5 million in annual recurring revenue a metric used by fast growing young businesses to provide a snapshot of their earnings are seeking valuations of more than $500 million, according to senior Silicon Valley venture capitalists. Valuing nascent businesses at 100 times their earnings or more dwarfs the excesses of 2021, he added. Even during peak ZIRP, these would have been $250 to $300 million valuations. The market is investing as if all these companies are outliers. That's generally not the way it works out, he said. VCs typically expect to lose money on most of their bets, but see one or two pay the rest off many times over. There will be casualties, just like there always will be, just like there always is in the tech industry, said Marc Benioff, co founder and chief executive of Salesforce, which has invested heavily in AI. He estimates $1 trillion of investment on AI might be wasted, but that the technology will ultimately yield 10 times that in new value. The only way we know how to build great technology is to throw as much against the wall as possible, see what sticks, and then focus on the winners, he added. It could be analogous to Internet 1.0, says Lucas Swisher, a partner at CO2 who has backed OpenAI, Databricks and SpaceX. Then a few companies like Google and Meta grew extremely quickly and ended up owning the vast majority of their markets, he added. In this wave, we are seeing that only a few companies matter. They are black holes. Everything else gets sucked in. But it might be 15 companies this time rather than five. Sebastian Malaby, author of the Power Law, about the history of the VC industry, summarized the thinking among investors as if we have AGI, this will all be worth it. If we don't, it won't, he added. It comes down to these articles of faith about Sam Altman's ability to work it out. End quote. Nothing more for you today. Talk to you tomorrow.