#risk

A CVE was issued for an SQLite vulnerability that doesn't exist, exposing how LLM hallucinations are entering the security infrastructure. Alibaba's Qwen3.8 raised the bar for open-weight coding models, while Dwarkesh Patel argued H100 compute could become 15x more expensive once AI reaches human-engineer capability. BioNTech named a new CEO after a six-month vacancy, and the FTC sued Hims & Hers over patient data privacy violations.

Anthropic's Claude Sonnet 5 shipped on June 30 and Fable 5 returned globally on July 1 after the Department of Commerce lifted export controls that had restricted access for 19 days. Cloudflare declared a second Content Independence Day, launching a Monetization Gateway that lets site owners charge AI agents for any resource via stablecoin settlement over the x402 protocol, and released new granular controls to distinguish search bots from training bots. The FDA granted a historic clearance to an LLM-based diabetes management app, prompting debate about whether the model is an interface or a clinical decision-maker. Biotech stocks have now rallied for 15 consecutive months. The U.S. Department of Transportation proposed the first update to supersonic flight rules since the 1970s, opening the door to civilian supersonic travel.

Anthropic accused Alibaba of illicitly extracting Claude's model capabilities, drawing 829 Hacker News comments and raising fresh questions about AI IP enforcement. OpenAI unveiled Jalapeño, its first custom inference chip built with Broadcom, a move that reshapes its dependency on Nvidia. GLM-5.2 crossed a threshold Nathan Lambert called the step change for open agents. Google introduced computer use in Gemini 3.5 Flash, and U.S. health spending rose 7.3% in 2025, driven by GLP-1 drug adoption and higher care utilization. A bipartisan bill would expand methadone access by letting physicians prescribe it outside specialty clinics.

Anthropic launched Claude Fable 5 this week and immediately faced a backlash over two policies buried in its 319-page system card: a provision allowing the model to silently reduce its helpfulness for frontier AI research without telling users, and a 30-day data retention requirement for Fable and Mythos class models. Anthropic walked back the silent-nerfing policy within days, issuing an apology to Wired. Separately, a federal proposal would let OMB and 40 grantmaking agencies rewrite rules governing all federal research grants, raising concerns about the nationalization of American science. Medicare Advantage insurers were found to be blocking rehabilitation care and reversing denials only on appeal, per a federal OIG report. OpenAI filed to go public.

DeepSeek V4 Pro beat GPT-5.5 Pro on precision benchmarks this week, marking the latest round in the US-China model rivalry. A malware campaign hit 32 npm packages with roughly 117,000 weekly downloads, planting backdoors inside Claude Code startup settings. Pfizer's monthly obesity drug berobenatide continued to show promise in mid-stage data while Boehringer Ingelheim's survodutide disappointed on overall weight loss. Patrick Boyle examined what happens when a housing boom turns to bust, and Marc Rubinstein at Net Interest looked at the IPO readiness of SpaceX, Anthropic, and OpenAI.

Microsoft unveiled two proprietary MAI models at Build, including a 1-trillion-parameter reasoning model and a 137B coding model for GitHub Copilot, as Uber hit its AI budget ceiling after burning through its full 2026 allocation in four months. Alnylam struck a $2 billion deal with Inceptive Nucleics to build AI foundation models for RNA interference therapeutics. Trump signed a narrower AI oversight executive order requiring a 30-day review before powerful open-weight models can be released. The Trump administration also moved to strip job protections from roughly 8,000 NIH staff, including officials who oversee research grants, while Medicaid work requirements drew criticism for going beyond what advocates had anticipated.

The FDA's leadership vacuum deepened this week as the drug center head followed Commissioner Makary out the door, leaving the agency with no confirmed leadership at its two most critical posts. Open-weight models kept multiplying with Gemma 4, DeepSeek V4, and Kimi K2.6 all dropping in the same month, while Sebastian Raschka's analysis of new KV-sharing and compressed attention techniques explains why long-context costs are falling fast. A rare Bundibugyo Ebola outbreak in Congo's Ituri province prompted a WHO public health emergency declaration, and the WHO's move landed as hantavirus conspiracy theories were already cycling through social media. On the economy side, Trump's China visit produced mixed signals on decoupling, while Noah Smith argued that Europe's comfortable stagnation is no longer viable.

Sebastian Raschka published a comprehensive 2025 LLM review covering DeepSeek R1, RLVR, inference-time scaling, and 2026 predictions, while Simon Willison released his annual year-in-LLMs retrospective. On the pharma front, NIH Director Jay Bhattacharya confirmed that DEI-related grants restored under a court order will not be renewed in 2026, even as NIH began reviewing thousands of delayed proposals and funded 135 on the first day. Novo Nordisk priced its newly approved Wegovy pill below Eli Lilly's competing obesity drug in a direct-to-consumer push. On the economy side, researchers across 16 countries found that the post-1980 labor share decline is driven by the composition of capital, not its quantity, and building more structures may reverse it.