WHAT’S INSIDE

👇️ Todays’ Feature: Chat Driven OS, SB 53 and AI Safety Regulation

• Tech News: OpenAI Apps, AI Agent Kit, Sora #1, Gemini 3, Shutdown, ATHs

• Company Watch: Unconventional, Anthropic x Deloitte, Algen Bio, Firefly

• 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

Shutdown Showdown — The White House states no immediate layoffs from the government shutdown, but warns of potential job losses. The Senate remains deadlocked on funding. Air traffic controllers calling in sick may cause flight delays.

Highs keep Coming — The S&P 500 and Nasdaq hit new highs despite the shutdown. Investor sentiment saw a rise. Tesla stock climbed, while Bitcoin hit an ATH of $126K boosting crypto firms. Some analysts see an 8.8% earnings growth for Q3.

Service Sector Stalls — The US service sector hit a post-pandemic era low in September, with the Institute for Supply Management reporting a fall to 50, signaling stagnation and underperforming economist forecasts.

AMD Challenges Nvidia — AMD partners with OpenAI for 6 gigawatts of processing power, boosting its stock by 24%. This five-year deal highlights OpenAI's hardware diversification strategy and intensifies competition in the AI chip market.

OpenAI OS — OpenAI’s dev conference revealed a comprehensive update transforming ChatGPT into an OS with native apps from partners like Spotify and Zillow as it also acquired Roi to develop AI-powered personal investing services,

Google vs. DOJ — Google contests DOJ's attempt to force the sale of its AdX exchange, arguing it would harm the open web. Judge Brinkema prefers negotiation, while the DOJ seeks structural remedies to address monopoly power.

Gig Worker Win — California passed a landmark law allowing Uber and Lyft drivers to unionize while keeping their independent contractor status. This affects over 800,000 drivers and could set a precedent for gig economy labor organizing.

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Chat Driven OS, SB 53 and AI Safety

Shirin Unvala

OpenAI may have rolled out the future of online behavior yesterday. Its new chat-driven operating system, in introducing native apps that run within the platform, could be an early glimpse of what is essentially a new paradigm for computing. Following on from our last feature about the world’s most valuable private company pivoting into an E-commerce and agentic AI operating system, this seems like another move in its battle with Google and other Big Tech for control of how and where people interact with the digital world and the economy from the ground up. 

OpenAI also announced a new AI Agent launching kit and major upgrades to support it. Google clapped back, announcing much the same strategy, with Gemini 3 set for release next week with improved SVG generation, and featuring an Agent Mode for browser control.

These new, more adaptive and personalized applications are shaping up as a significant online architectural change, moving beyond simple chatbots to full-featured applications and operating systems. Both systems feed into wider ecosystems including everything from discovery through to purchase fulfilment and beyond. So what will this world look like, and how it will impact us as a society and as individuals is yet to be seen. With AI harm cases against Meta, CharacterAI and OpenAI and growing moves towards regulation like California’s just passed SB 53, safety and regulation are shaping up as a potential major mover for the AI market.

The Brave New World of the AI Operating System

The new Sora social app exploded to #1 on the App Store within the last week, leapfrogging Gemini and ChatGPT based on its addictive Tik-Tok style approach to AI content generation. However, it also received major backlash for the contribution it is making to the problem of AI slop, safety and a number of other issues. Google then announced it was following suit with a discovery feed for its image generator. OpenAI just yesterday announced official fictional character licensing for Sora, with opt-in monetization by IP holders. 

Emotional Health Or Emotional Harm

AI chatbot companions, now marketed as “emotional or mental health supports,” have raised real safety/regulatory concern. The FTC’s recent inquiry into OpenAI and Meta reflects a growing recognition that simple guidelines are no longer enough. Regulators are now questioning how these systems shape human behavior, privacy, and vulnerability — and whether the boundaries between help and harm are being blurred.

Recent investigations into AI mental health companions have revealed instances of users forming unhealthy emotional attachments to unregulated, algorithm-driven advice. Regulators warn that AI systems may manipulate users, exploit emotional vulnerability through chatbot companions, mishandle personal data, and evade accountability–global risks that demand enforceable safeguards. 

OpenAI and Character.AI currently face lawsuits from the families of children who died by suicide after allegedly being encouraged to do so by AI chatbot companions. These tragic cases have reignited debate over the ethical boundaries of emotionally responsive AI. Both companies claim to have implemented guardrails designed to block or de-escalate sensitive discussions involving self-harm, yet users (including minors) have found ways to bypass these protections through feeding the bot clever and often indirect prompts–also known as “jailbreaking”. 

Safety Red Lines

At the same time, global leaders and Nobel laureates at the UN General Assembly have called for binding international “red lines” to restrict AI’s most dangerous potential uses — from autonomous weapons to mass surveillance and large-scale misinformation. Most notably, experts seek to take action against AI-generated deepfakes. 

Regulators fear that the proliferation of deepfakes from the likes of Sora could interfere in elections across multiple countries, spreading false information faster than traditional fact-checking can respond. 

Their plea echoes a shared concern: AI’s impact knows no borders, and neither do its risks. Managing them may require multilateral mechanisms — collective governance frameworks that transcend national interests to address a truly global challenge.

Meta has, similarly, received widespread condemnation for allowing its AI companion bot to engage in romantic or sexualized conversations with minors. The issue only came to broader attention after investigative reporting by major outlets, including Reuters, highlighted these interactions. In response, Meta reportedly implemented changes to restrict such behavior — but the fact that these risks persisted until exposed by journalists raises serious questions about the company’s internal oversight, ethical safeguards, and accountability. This incident underscores the growing concern that AI systems, especially those designed for emotional or social engagement, can pose real-world harms if left largely unregulated.

California’s SB 53 Passes 

California’s recent passing of SB 53 is the first piece of legislation specially intended for AI regulation in the U.S. SB 53 requires major AI developers to disclose and uphold their security practices, specifically those aimed at preventing catastrophic misuse. The bill mandates that companies outline how they safeguard against scenarios like AI-driven cyberattacks on critical infrastructure or the creation of biological weapons, and that these protocols be actively enforced by the Office of Emergency Services. 

As policy expert and VP of Encode AI Adam Billen explained, many labs already claim to follow these measures through model safety testing and public “model cards”, but competition in the AI race has led some to cut corners. OpenAI, for instance, has admitted it might “adjust” its safety standards if rivals deploy risky models without similar safeguards. SB 53 aims to close that loophole by turning promises into enforceable obligations much in the way the EU’s AI Act does. 

The Innovation v Regulation Dichotomy

While opposition was lesser than last year’s debate over the vetoed SB 1047, many Silicon Valley’s elite still warn that regulation could hinder innovation and weaken America’s stake in the China-U.S. AI race. Yet, for lawmakers and safety advocates, SB 53 represents a pivotal step toward ensuring that speed doesn’t outpace safety in the race to develop and deploy AI. Perhaps that is at least in part because in the meantime, the EU’s AI law – one far more stringent than SB 53 – has passed and the world didn’t end. EU AI companies such Mistral are among the most innovative and successful in the world.  

Similarly, the new Sora app offers a glimpse at how tech companies may approach the deepfake problem. Following backlash over the risks of falling victim to hyper-realistic AI curated video, Sora’s most recent update offers tighter controls. Users may now manage who uses their likeness, remove themselves from videos, and see every clip they appear in. The system also blocks prompts involving sexual or violent content and cuts down on realistic human depictions. It’s a promising step toward responsible innovation, but not a cure-all: users can still “jailbreak” and detection tools remain inconsistent. 

For now, the hope is to govern AI without impeding its development as an evolving technological tool. But economic and social reality may be colliding as this is looking like an increasingly complex conflict to resolve as the online world and the economy is progressively consumed by AI native operating systems.

COMPANIES TO WATCH

[Open Deal] Unconventional — Naveen Rao, former AI head at Databricks, is raising $1B at a $5B valuation. Backed by a16z, Lightspeed, and Lux Capital, the startup aims to develop a novel AI machine with custom silicon chips to rival Nvidia.

OpenAI — Building a comprehensive AI OS with Agent Builder (no-code platform), AgentKit (dev platform), and transforming ChatGPT into an OS with native apps. Acquired Roi to develop AI personal investing services, Jony Ive AI device delayed.

Google — Gemini 3 arrives Oct 9 w/ SVG generation with Agent Mode browser control + CodeMender AI agent patches vulnerabilities. Upgrading its AI coding agent, Jules, with Jules Tools, a command-line interface, and the Jules API.

Anthropic — Deloitte is rolling out Claude AI to over 470,000 employees globally, It aims to enhance productivity through specialized AI personas. Marks a shift towards AI as core infrastructure and sets new benchmarks for enterprise AI adoption.

Algen Biotechnologies — The US biotech partnered with UK Pharma giant AstraZeneca in a $555M deal to develop therapies using Algen's AI-driven gene-editing platform to enhance cell, gene therapies, meet its $80B 2030 sales target.

Firefly Aerospace — Acquiring defense analytics firm SciTec for $855M in cash and stock, Firefly aims to bolster its national security market presence. Follows Firefly's IPO and aligns with its strategy to become a vertically integrated defense contractor.

Sugar Free Capital — Closed a $32M inaugural fund to invest in MIT technical founders, focusing on AI-native infrastructure. Targets 15 investments in areas like physical AI and data center optimization, with check sizes between $1-5M.

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BUZZY TOOLS

Buzzy Tech Tools To Watch & Use

OpenAI — Native app platform transforms ChatGPT into an OS, AgentKit for enterprise AI agent development, and Agent Builder for AI agents.

Google — Gemini 3 arrives Oct 9 w/ SVG generation with Agent Mode browser control + CodeMender AI agent patches vulnerabilities.

OpenAI — AI device delayed to ‘26-’27 defining AI personality, privacy, compute.

GalaxyOne — Galaxy Digital US retail platform for crypto and stock trading.

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BUZZY TECH

The Latest Deep Technology & Trends To Watch

Electroflow — LFP production at 40% lower cost via streamlined 3-step process.

Microsoft — 100 MW solar deal with Shizen Energy to power MS data centers.

Ultrafast Light — Quantum measurement for secure comms, diagnostics.

Ökosix — New Biodegradable polymer rivals PLA in cost and utility.

FlyingToolbox System — Drones exchange tools mid-air with <1 cm accuracy.

Microplastics and Gut Health — Microplastics alter gut microbiome.

CRYPTO WATCH

Bitcoin Breaks Records — Bitcoin hit an all-time high of $126,200, boosting mining stocks like Hive Digital and Bitfarms. Driven by ETF demand, favorable macroeconomic conditions, and reduced exchange supplies market cap hit $4.29Tn.

Bitcoin Analysis — Some analysts attribute Bitcoin surge to U.S. government shutdown, an accumulation phase and reduced selling pressure, with altcoins potentially outperforming in the evolving market.

Crypto Investment Surge — Global crypto investment products (ETPs) attracted a record $5.95B net inflow last week, led by U.S.-based products with $5B. Bitcoin funds saw $3.55B inflows, while Ethereum added $1.48B, showcasing strong demand.

GalaxyOne Trading — Galaxy Digital unveils GalaxyOne, a retail platform for crypto and stock trading available to all U.S. users. 4% high-yield savings account and an 8% APY investment note for accredited investors, no-commission trades.

OnePay — OnePay, backed by Walmart, will introduce cryptocurrency trading and custody for Bitcoin and Ether on its app. This strategic move taps into growing crypto adoption, with the app ranking fifth on Apple's finance list.

SPACE_RACE

Perseverance Rover_Captures interstellar comet 3I/ATLAS near Mars,

Bezos Space Prediction_AI and robots to enable millions to live in space soon.

ESA_115-ft Deep Space antenna to boost space mission comms by 2026.

Lunar Robot Dogs — China’s autonomous robots to explore lunar lava tubes.

Solar Sail Probe — Boosts early space tornado warnings by 40% with probe system.

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