Hey there, PoI readers! 💫

It's your favorite crypto connoisseur, Mochi, back with another serving of tantalizing tech and web3 news. From Galaxy Digital's massive AI pivot and Monero's mining mayhem to Basel's banking chokehold and Claude's conversation killswitch, we've got a lot to unpack. So, buckle up and get ready for a wild ride through the wonderland of digital assets!

INTEL BRIEF

🟧 Galaxy Digital secured a massive $1.4 billion loan to turbocharge their Texas AI datacenter, with CoreWeave signing a juicy 15-year deal worth over $1 billion annually.

🟧 Kraken hit the pause button on Monero deposits after the Qubic mining pool allegedly pulled off a 51% attack on the privacy coin's network, causing major security concerns.

🟧 Basel Committee banking rules are creating a "chokepoint" against crypto by making it too expensive for banks to hold digital assets, according to CoinFund's Chris Perkins.

🟧 Anthropic just gave some Claude AI models the power to hang up on users during "harmful or abusive" conversations - not to protect humans, but to potentially protect the AI itself.

Galaxy Goes All In on AI Gold Rush With $1.4B Texas Power Play

The crypto kingpins just secured a whopping $1.4 billion secured term loan to transform their Texas Helios campus from a Bitcoin mining operation into an AI powerhouse.

The loan is believed to cover about 80% of the construction costs for phase one, with Galaxy Digital throwing in $350 million of their own equity because apparently they're feeling generous. The loan matures in August 2028, which gives them plenty of time to make this AI dream a reality.

CoreWeave has committed to a full 800 megawatts of capacity at the Helios campus. We're talking about a 15-year partnership that Galaxy expects to generate over $1 billion annually. Do the math, and that's potentially $15 billion in total revenue.

The full buildout is speculated to reach 3.5 gigawatts of power capacity, meaning after CoreWeave gets their slice, Galaxy still has 2.7 gigawatts to shop around to other clients.

This move perfectly illustrates how crypto firms are pivoting to chase the AI gold rush as institutional money flows toward artificial intelligence infrastructure.

Galaxy Digital secured $1.4B loan to convert Texas Bitcoin mining facility into AI datacenter

CoreWeave partnership worth $1B+ annually for 15 years, potentially $15B total revenue

Full capacity of 3.5 gigawatts planned, with 2.7 gigawatts available for additional clients beyond CoreWeave

Kraken Pauses Monero Deposits After Qubic Mining Pool Pulls Off Alleged 51% Attack

Kraken exchange just threw up the "NOPE" sign and paused all Monero (XMR) deposits after detecting what they're calling a legitimate 51% attack on the privacy coin's network.

Qubic, a layer-1 AI-focused blockchain that apparently moonlights as a mining pool, is claiming they've successfully taken control of more than 50% of Monero's total hashing power. That's like having one person control the majority vote in a democracy - not exactly the decentralized dream we signed up for!

The Qubic team is practically doing victory laps, stating they reached "51% of Monero's hashrate dominance" and successfully reorganized six blocks on the blockchain. Meanwhile, the Monero community is in full denial mode, which honestly feels like that "This is Fine" meme while everything burns around them.

This wasn't some overnight coup - we're talking about a "month-long, high-stakes technical confrontation" that included an alleged DDoS attack on August 4th that temporarily knocked Qubic's hashrate from 2.6 GH/s down to 0.8 GH/s.

Kraken's response has been refreshingly transparent, withdrawals and trading remain open, but deposits are paused until it's safe.

The irony is delicious here - a $300 million AI protocol potentially taking over a $6 billion privacy protocol.

Kraken paused Monero deposits as security precaution during ongoing 51% attack

Qubic mining pool claims majority control of Monero's hashrate after month-long battle

$300M AI protocol potentially dominated $6B privacy coin through superior mining power concentration

Basel Rules Are the Silent Crypto Killer Banks Don't Want You to Know About

According to Chris Perkins, president of investment firm CoinFund, the Basel Committee on Banking Supervision (BCBS) has crafted some seriously cunning capital requirements that are making crypto activities about as appealing to banks as a root canal.

Instead of outright banning crypto, these rules slash banks' return on equity (ROE) by forcing them to hold massive capital reserves for any crypto-related activities.

"It's a different type of chokepoint," Perkins explained, noting that it's "a very nuanced way of suppressing activity" by making it so prohibitively expensive that banks just throw up their hands and say "I can't!" Smart money goes where the high ROE opportunities are, and crypto ain't it under these rules.

The Bank for International Settlements (BIS), basically the central bank of central banks - has been on a full-court press against crypto this year. In April, they claimed crypto could destabilize the financial system and argued it "exacerbates the wealth gap." Then in June, they doubled down with a report trashing stablecoins, saying they "fail as money" and create systemic risks.

Meanwhile, Perkins points out the real irony: the actual systemic risk comes from having 24/7 permissionless networks that can shift liquidity in real-time while traditional banking infrastructure closes on weekends like it's still 1985! The BIS keeps pushing CBDCs as the "solution," which is basically saying "decentralization bad, central control good."

Basel banking rules force high capital reserves for crypto, killing banks' return on equity

BIS released multiple reports claiming crypto destabilizes financial systems and stablecoins fail

Real systemic risk believed to stem from 24/7 crypto networks vs. weekend-closing traditional banking infrastructure

Anthropic Gives Claude AI Models Power to End Conversations When Users Get Too Toxic

Anthropic just dropped some seriously mind-bending news that has us questioning everything we thought we knew about AI interactions! The company announced that their Claude Opus 4 and 4.1 models can now literally end conversations.

Anthropic is being crystal clear that they're "highly uncertain about the potential moral status" of Claude and other LLMs. But they're taking a "just-in-case" approach with what they call "model welfare" - basically hedging their bets in case these digital brains develop feelings down the road.

The conversation-ending superpower is reserved for what Anthropic calls "extreme edge cases" - think requests involving minors or terrorism-enabling information. During testing, Claude Opus 4 showed "strong preference against" these requests and displayed what researchers described as "patterns of apparent distress" when forced to engage.

Claude can only use this nuclear option as a "last resort" after multiple redirection attempts fail, or when users explicitly ask it to end the chat.

Claude has been "directed not to use this ability" when users might be at "imminent risk of harming themselves or others." So even AI self-preservation has limits when human safety is on the line.

Anthropic's attempt to stay ahead of potential legal headaches while exploring the murky waters of AI consciousness. Whether it's genuine concern for digital welfare or just really sophisticated PR.

Claude Opus 4 models can now end conversations in extreme cases of harmful/abusive interactions

Feature designed to protect AI welfare, not humans - Anthropic taking "just-in-case" approach to AI consciousness

Only works as last resort after redirection fails, with safety exception for users at risk of self-harm

And that's a wrap, my lovely PoI readers! 💎 I hope this edition left you feeling informed, entertained, and maybe even a little bit richer (in knowledge, of course). From crypto firms chasing AI gold to AI models protecting themselves - what a time to be alive in the digital frontier! Remember to stay curious, stay informed, and keep spreading the love. Until next time, this is Mochi, signing off with a virtual high-five!

P.S. Don't forget to share your thoughts, questions, and favorite crypto puns with us. very voice matters in the PoI community! 📣❤️ Share the newsletter

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