Transformer Weekly: US-China talks, AI executive order, and Anthropic’s $900b valuation
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NEED TO KNOW #
Scott Bessent said theUS andChina will “set up a protocol” to discuss how to ensure nonstate actors don’t get hold of dangerous AI capabilities.Rumors continue to swirl around a forthcoming
AI executive order in the wake of Mythos.Anthropic is reportedly set to raise $30b at a $900b valuation, overtaking OpenAI.
But first…
THE BIG STORY #
As the tone of the AI regulation conversation shifts, it looks like OpenAI may have seen which way the wind is blowing. Recent developments in Illinois — including unreported written testimony shared with Transformer — suggest the company is increasingly open to meaningful AI safety legislation.
Last month, OpenAI endorsed a controversial bill in Illinois that would provide AI companies with a liability shield as long as they met (very basic) transparency requirements. The move prompted outrage, with LawAI’s Charlie Bullock calling it a contender for “worst state AI bill of all time.”
Now, however, OpenAI appears to be backtracking. In written testimony to the Illinois Senate this week OpenAI’s Caitlin Niedermeyer disavowed the liability shield part of that bill.
“We want to be very clear: we do not support the liability safe harbor included in SB 3444,” Niedermeyer said. “We testified in support of SB 3444 because it also contributed to a broader, coordinated approach to frontier AI safety and helped establish a pathway toward harmonization with emerging national standards … we were silent on the provision in that bill related to a safe harbor for liability and some took it as an endorsement of a no liability framework.”
OpenAI has not just disavowed the controversial provision in SB 3444. Along with Anthropic, it has also endorsed a much stronger bill, SB 315, which has the backing of AI safety organizations. Like various AI bills circulating state legislatures at the moment, SB 315 (first introduced in February as SB 3261) is closely modeled on California’s SB 53 and New York’s RAISE Act: it is focused on catastrophic risks, and requires the largest AI companies to develop and adhere to a frontier safety framework.
Importantly, SB 315 also builds on those bills by requiring third-party audits to check companies are actually complying with their safety frameworks — a provision that was in the original version of RAISE, but was stripped out due to industry opposition.
“We think it would be a big advance for AI safety if SB 315 passes,” said Scott Wisor, policy director at the Secure AI Project (which has supported the bill since its original incarnation). “I think it is very good that two frontier model companies are endorsing third-party audits, and it shows a very positive change towards stronger safety measures.”
**Opposing measures that give AI companies an easy ride and backing regulation with actual teeth certainly seems to indicate a change in approach. **This appears to be the first time OpenAI has endorsed third-party audits in a state bill, and it’s certainly a stark departure from its previous support for SB 3444 — which the bill’s sponsor had described as “an initiative of OpenAI.” An OpenAI spokesperson said getting legislation right was an iterative process, and that it would now do all it could to get SB 315 enacted.
Combined with statements this week distancing OpenAI from the Leading the Future super PAC, supporting an international AI governance body, and calling for CAISI to develop auditing standards, one might hope this is the beginning of a wholesale shift for the company, and one that endures. Perhaps it is driven by newfound appreciation for the stakes; perhaps public affairs boss Chris Lehane is simply reading the room. Whatever the reason, it looks like a positive development — for both OpenAI and everyone else.
— Shakeel Hashim
THIS WEEK (AND LAST WEEK) ON TRANSFORMER #
—Palantir’s controversy is the productJames Ball on how Palantir’s fiery rhetoric helps mystify its mostly mundane tech.—How Silicon Valley sold Washington an AI raceYi-Ling Liu lays out how the AI industry built up, and benefited from, the narrative of a race to AGI with China.—An Oregon congresswoman distanced herself from Leading the Future — then backtrackedVeronica Irwin reports on the strange case of one of Leading the Future’s latest midterm endorsements.
THE DISCOURSE #
**Anton Leicht **argued: “Three trends — compute, security, and US government involvement — will further constrain the availability of frontier AI in the future.”
“This is not a future we should welcome. AI tokens will be strategically and economically central to all future societies, so we should do our best to enable their free flow.”
Andy Hall discussed the confusing politics of post-AGI jobless prosperity: “The backlash to AI isn’t here yet … [but] real backlash will happen if and when job losses pick up steam.”
“Let’s not imagine a backlash that hasn’t yet truly begun. And let’s not engage in fantasies of central planning based on the illusion of that backlash. Instead, let’s use the small window of time we may have … to develop sensible policies that help us gain visibility about where we are and where we’re going.”
Meta research scientist** François Fleuret **dropped a hot take:
“Machine learning and AI did more to understand the nature of knowledge and our relation to reality than 20 centuries of philosophy. I am ready to kind of defend this hill.”
**SAIL writers **spent 10 days touring Chinese AI and robotics labs.
In a piece with
Kai Williams,ChinaTalk’sLily Ottinger says sheheardlots of complaints about the compute constraint (say that three times fast):“I got the sense that AGI is like a religion for these researchers, where — as is also the case in the US — devotees of the Machine God pray at the altar by working overtime even when the marginal hour of labor is less impactful than the marginal GPU would be.”
Jasmine Sunwroteabout China’s job loss fears, which pale in comparison to US panic:“When I told my 24-year-old cousin that American new grads felt like they couldn’t find jobs because of AI, he scoffed and said: ‘In China, we can’t find jobs because there are too many people.’”
“Everyone assumes AI is here to stay, so individuals should wield ChatGPT/OpenClaw/Doubao to avoid falling behind. Playing conscientious objector would only disadvantage your own prospects.”
ICYMI while *Transformer *was off, **roon **tweeted: “it is a literal and useful description of anthropic that it is an organization that loves and worships claude … a monastery, a commercial-religious institution calculating the nine billion names of Claude.”
“[gpt] doesn’t inspire worship in the same way … they go to it not expecting the Other but as a logical prosthesis for themselves.”
**Tenobrus **replied: “openai has been starting to more strongly philosophically differentiate themselves from anthropic with the tool-framing. [but] the subtle knife when dropped still slices open the fabric of the world … worse, these knives are self wielding.”
“[tool-framing] feels more like a wistful dream or a PR position than something that can exist as a part of humanity’s lasting future”
**Boaz Barak **countered: “The basic thing I dispute is that there is a fundamental tension between AI being capable and being ‘tool like.’”
“Scientists and engineers often serve as ‘tools’ for leaders, even though they (we) are more intelligent than these leaders in many of the ways that matter…Humans have a particular package as localized individual intelligence. But it doesn’t mean all intelligences have to come in that package.”
POLICY #
AI loomed in the background of theTrump-Xi summit.Without giving many details,
Trumpsaidthe two discussed “possibly working together for guardrails.”Treasury secretary
Scott Bessentsaidthe US and China will “set up a protocol in terms of how do we go forward with best practices for AI to make sure nonstate actors don’t get a hold of these models.”Trump was joined in China by a range of AI industry figures,
includingElon Musk,** Jensen Huang**, and** Dina Powell McCormick**.** Export controlswere discussed, Trumpsaid, but nothing concrete has come from it.Reutersreportedthis week that the US approvedNvidia H200** sales to 10 Chinese firms includingAlibaba, Tencent, and ByteDance, but no deliveries have been made due to Chinese government concerns.
Rumors continue to swirl around a forthcoming
AI executive order in the wake ofMythos.While
Transformerwas off, National Economic Council directorKevin Hassettsuggestedthe administration was considering an ‘FDA for AI,’ prompting industry backlash.White House chief of staff
Susie Wiles quicklyshut downthat idea.The current plan, pertheDaily Signal, supposedly involves some sort of pre-deployment vetting for frontier models. It seems up in the air as to whether that will be voluntary or mandatory for government contractors, thanks togovernment infighting.There also
appearsto be a turf war on who, exactly, will do the evals, with intelligence agencies trying to usurpCAISI’s role as the government’s AI evaluator.Seemingly as part of that fight, a CAISI announcement about
Google DeepMind,** xAIand Microsoft**signing pre-deployment AI testing agreementsdisappearedfrom the agency’s website.
The Trump administration is also
reportedlyworking on measures to get companies to work with the government onstrengthening cybersecurity.Meanwhile,
Pentagon CTOEmil Michaelsaidthe DOD is using Mythos to find vulnerabilities — but that his broader issues with Anthropicwon’t beresolved.
Congress is getting worried about Mythos too.A
bipartisan lettersignedby over 30 lawmakers urged the** National Cyber Directorto address AI cybersecurity threats**.Notably, the letter mentions that future models might pose risks related to
CBRN andautomated AI R&D.
Signatories include
Reps. Jay Obernolte andLori Trahan, who are working on a federal AI bill.** Sen**.** Ted Cruz**, meanwhile,acknowledgedthe need “to protect against catastrophic risk,” though he still warned about stifling innovation.And
Sen. Jim BankssaidMythos means it might “make sense to engage in dialogue with Chinese officials.”In a letter to the Trump administration, he also highlighted
loss of control risks.
The
House Homeland Security Committeereceiveda closed-door briefing fromAnthropic about Mythos on Wednesday.
The
House Oversight Committeelauncheda probe intoSam Altman’s potential conflicts of interest.Seven GOP state attorneys general called for an SEC review of his personal investments in companies
OpenAI has backed.
Colorado Governor Jared Polissigneda replacement for the state’s controversialAI Act.** Connecticut’sGeneral Assemblypassed HB 5222**, which would create a voluntary pilot program for “Independent Verification Organizations” to assess AI systems.** Californiagubernatorial candidate Tom Steyer**proposeda jobs guarantee for workers displaced by AI.Germany’s ministry for digital affairs and cybersecurity agency
proposedcreating aGerman AISI and requested access toMythos.** OpenAIhasproactivelyoffered European governments access toGPT-5.5-Cyber**.
Pope Leo XIV is expected tofinally signhisAI encyclical today. It will reportedly focus on AI’s impact on workers, and its signing is timed with the anniversary of Pope Leo XIII’s “Rerum Novarum.”
INFLUENCE #
President Trumppurchased$1-5m in** Nvidiastock a week before the Commerce****Department** approved sales of Nvidia chips toChina, new disclosures revealed.The Trump Organization said the president has no role in making these investments. Public First Action hascontributed$500,000 toAbundant Future, the** Garry Tanand Chris Larsen**-backed super PAC opposing** Saikat Chakrabarti**in CA-11,Transformerlearned.SB 53 author
Scott Wiener is running against Chakrabarti.
The
Secure AI Projectendorsed** Tom Steyerfor Californiagovernor. Leading the Future**endorsedthree Democratic congressmembers —Val Hoyle(OR-04),** Rob Menendez**(NJ-08), and** Ritchie Torres**(NY-15).** OpenAI’s Chris Lehaneand venture capitalist Ron Conway**hosteda fundraiser for** Sen. Jon Ossoff**.** OpenAI**endorsedthe** Kids Online Safety Act**.** Anthropic**releaseda paper on** US-China competition**, arguing that “it’s essential that the US and its allies stay ahead of authoritarian governments like the Chinese Communist Party.”It argues that “responsibly building a lead in developing and deploying the most advanced AI augments our ability to influence AI safety in China and elsewhere.”
AI lobbyists are reportedlyannoyedby all theexecutive order uncertainty.Two new polls foundoverwhelmingsupportformandatory AI safety testing.A
Gallup surveyfound70% of Americans opposedata centers in their communities.A NYTanalysis found thatAndreessen Horowitzisthe biggest donor in the 2026 midterms, with**$115.5m** in contributions.A quarter of all
federal lobbyists nowwork, at least in part, on AI issues.
INDUSTRY #
OpenAI #
The
Musk-OpenAI trial drew to a close.Greg Brockman’s diary stole the show last week,revealinghis inner turmoil about OpenAI’s transition to a for-profit corporation.Satya Nadella andIlya Sutskever took the stand on Monday.Sam Altman testified on Tuesday.A
court filing showed that he holds over**$2b** in companies that have worked with OpenAI.In a somewhat painful exchange, Altman attempted to
defendhis honesty and character against Musk’s lawyer.He testifiedthat he was “extremely uncomfortable” withMusk’s demand for complete control over OpenAI’s proposed for-profit subsidiary.Altman also
gaveus this: a meeting about folding OpenAI into Tesla once ended with “a LONG long period of time with Elon showing us memes on his phone.”
Both sides’ lawyers have now given closing arguments. The jury is expected to give its verdict next week.
OpenAI is reportedly
preparingpossiblelegal action againstApple over their ChatGPT integration partnership, after reportedly being annoyed the deal hasn’t worked out well for it.OpenAI
launchedDaybreak, a cybersecurity initiative similar to Anthropic’s Project Glasswing for Mythos, granting tiered access to the company’s most advanced models.It
launchedtheOpenAI Deployment Company, a new subsidiary that will embed**“forward deployed engineers”** at businesses implementing enterprise AI tools.Sam Altman
announcedtwo months offree Codex usage for companies that switch from another platform.He reportedly
discussedstarting a newAI compute company that he would fundraise for, with OpenAI as the majority shareholder but not its only customer.The family of a
school shooting victim issuingOpenAI, alleging thatChatGPT gave the shooter instructions on firearm use and optimal timing to maximize casualties.
Anthropic #
While
Transformerwas off, Anthropicstrucka surprisingdeal with SpaceX to boost its compute capacity.This came just a few short months after Elon Musk
calledAnthropic “evil.”Platformer’sCasey NewtoninterpretedMusk’s change of heart as a sign** xAI**is falling behind in the AI race.In the
wordsof tech investorBen Pouladian: “The enemy of my enemy is my friend, and it’s also my compute partner.”
Anthropic has reportedly
agreeda**$30b** fundraising deal at a staggering**$900b valuation**, overtaking** OpenAI**.The deal is expected to close this month.
Eight
secondary marketplaces are reportedlyofferingaccess to unauthorized, sometimes fraudulentshares in Anthropic that the company says won’t be honored.Anthropic
partneredwith theGates Foundation to put**$200m** toward programs in global health, life sciences, education and economic mobility by 2030.It launched new AI tools targeting the
andlegalindustrysmall.businessesIt’s reportedly
planningto acquireStainless, which makes tools that streamline** API accessfor frontier models, for at least$300m**.Starting June 15, paid
Claude plans willhaveamonthly credit for programmatic usage, separate from interactive usage. Lots of power users are mad about it.
Google will reportedlylauncha newGemini model on Tuesday. It is not expected to advance the frontier.It reportedly caughtcriminal hackers using anAI-developed zero-day exploit— thefirstknown real-world case of its kind.It’s reportedly
hiringhundreds offorward deployed engineers to help with enterprise AI adoption.It shipped lots of Gemini upgrades,
includingGemini Intelligence, AI features for premium Android phones, and an** AI-powered mouse pointer**that understands context through pointing and speech (thisdemomakes it make sense).
Meta #
Meta reportedly plans to
cut10% of its workforce next week, and morale is low. One employee toldWired,“I don’t know anyone having a good time.”It’s testingaGrok-like AI integration in** Threads**.** Alexandr Wang**made a rare podcastappearanceonCore Memory.
xAI #
xAI
recruitedMorgan Stanley,** Apollo Global Management Inc.and other Wall Street firms with ties to Elon Musk to test Grok**alongside other enterprise AI tools.It
installed19 more natural gas turbines toColossus 2, in the midst of an ongoing lawsuit alleging that xAI is violating the** Clean Air Act**.It
launchedGrok Build, an AI coding agent.
Others #
Microsoft is reportedlyscoutingfor potential AI startup acquisitions, preparing for a future without its $100b+OpenAI partnership.** Jensen and Lori Huang’s foundation**bought$108.3m of AI computing time fromCoreWeave to donate to universities and nonprofits for science and AI research.Shares of AI chip company
Cerebrasjumped68% in its trading debut, giving it a $67b market value.Isomorphic Labs, a Google-backed AI drug discovery company,raised$2.1b in its second external funding round.Recursive Superintelligence, founded by former OpenAI, Google DeepMind and Meta researchers to build self-improving AI,raised$650m at a**$4.65b** valuation.xAI cofounder
Igor Babuschkin is reportedly intalksto raiseup to $1b for a new research startup calledRiver AI at a**$5b valuation**.The
New York TimesprofiledAmp, which recentlyraised$1.3b to buy extra compute from data centers and redistribute it to startups and universities.The
Strait of Hormuzclosureis cuttingTSMC,** Samsungand other Asian chipmakers off from oil and other supplies, raising electronics prices worldwide. GitLab**announcedjob cuts, saying it will reinvest the money on AI agents, reorganize R&D teams, and automate many of its workflows.
MOVES #
AISI chief scientistGeoffrey Irvingsaidhe’s leaving AISI to move back to the Bay Area.He’s starting a “new nonprofit alignment research org.”
Jan Leikestepped awayfrom** Anthropic**’s Alignment Science team to start a new research project at the company.** Atoosa Kasirzadeh**joined** Google DeepMindto study the implications of AGI for human life and society. Alex Imas**joined** Google DeepMind**as director of AGI economics.The Trade Desk’s
Samantha Jacobsonjoined** OpenAIto lead its monetization partnerships. Suzanne Ashman**, former General Partner at LocalGlobe and Latitude,joined** UK Sovereign AIas managing partner. Jabari Cooper**joinedChamber of Progress as director of government relations for the Northeast.
RESEARCH #
The UK’s AISItesteda new version of** Claude Mythos Preview**, finding it significantly more capable at cyber tasks.The new version of Mythos and GPT-5.5 suggest cyber capability time horizons might be
doubling even faster than the 4.7 months AISI previously estimated.
METR, meanwhile,foundthat an early version of** Mythoshad a 50% time horizon on software tasks of at least 16 hours**, topping out its benchmark.** Thinking Machines**announced“** interaction models**,” trained from scratch to respond natively to real-time audio, video, and text, without an external harness.Researchers at
OpenAI, Anthropic, Google DeepMind and elsewherepublisheda paper on “positive alignment,” a framework for building AI as a “scaffold for human flourishing.”AI safety researcher
Stephen Casper wasdisappointed:“I can’t take it seriously as academic work, just as propaganda…I think of this paper as a mechanism of corporate capture of concepts from academic research on AI and society.”
Anthropicpublisheda blog post explaining how it eliminated** Claude’s blackmailingthrough examples of aligned behavior and descriptions of why unethical behavior is wrong. OpenAI**foundthat several of its recent models were accidentally exposed to somechain-of-thought grading during RL training.(This isn’t supposed to happen, but they didn’t find any signs that this worsened chain-of-thought monitorability.)
Redwood Research’s Buck Shlegeris commended OpenAI for publishing the report, andurgedAI companies to develop better systems for preventing similar problems.
METRsurveyed349 technical workers who self-reported that AI made their work 1.6-2.1x more valuable.On the flip side:
Carnegie Mellonsurveyednearly 400 professional visual artists, and found that 99% dislike AI and 85% reported completely abstaining from it.
BEST OF THE REST #
An
NYTessay by Tarbell journalist-in-resident Yi-Ling Liudescribedhow US and Chinese workers share a sense of being “harvested by the future” as AI feeds precarity, surveillance and nostalgia.Rest of Worldprofiled the community of Chinese-born AI researchers who havebecomesuperstars in Silicon Valley, founding startups valued in the billions and playing central roles at companies like Meta**,** OpenAIandxAIwhile navigating complications caused by US-China tensions.The
WSJexploredefforts to develop orbital data centers for AI compute by the likes of SpaceX**,** Blue Origin, Google andNvidia, detailing the “savage” economics of overcoming challenges with heat management, launch costs and power requirements, all accompanied by whizzy interactive graphics.In
Wired, a Hollywood screenwriterdescribedhaving to take work as an AI trainer, detailing chaotic conditions, plummeting wages, abrupt project cancellations and exploitative labor practices as entertainment industry workers increasingly turn to AI training gigs.Also in
Wired, the “sad wives of AI” are grappling with partners obsessed with AI work at the expense of their spouses and family life, according to an entertaining and depressingprofile.
MEME OF THE WEEK #
Source: 404 Media
Thanks for reading. Have a great weekend.