The AI Trade Gets Spooky

Luke Vargas opens with a report that Bitcoin and other cryptocurrencies are trading lower after Binance was hit by what the show describes as the biggest cyber-heist in history. Hackers took approximately $6.3 billion, and cybersecurity and blockchain-analysis firms have attributed the attack to TraderTraitor, a North Korean-linked hacking group. Alexander Osipovich explains that some of the stolen funds were commingled with assets from an earlier hack also blamed on North Korea, which helped researchers connect the incidents. Binance suspended transactions, while its founder said user funds were safe. The exchange said its U.S. arm was not affected. Osipovich says roughly $3 billion of the stolen funds have been frozen, particularly because issuers of stablecoins such as Tether and Circle’s USDC can freeze tokens to prevent them from moving. That still leaves about $3.3 billion in the hackers’ hands. He says crypto exchanges have long been vulnerable, but North Korea-linked groups have become more ambitious and sophisticated over the past year. The industry is also increasingly worried about AI-powered cyber tools, although there is no evidence yet that AI was used in the Binance attack. The smaller, sub-$3 million hack of prediction market Polymarket the previous day added to those concerns; the show notes that Polymarket has a data partnership with Dow Jones.

The program reports that officials in the United States, Singapore and Taiwan suspect a data-center executive with business ties to Nvidia CEO Jensen Huang of being a Chinese intelligence source. U.S. officials concluded last year that Beijing had recruited the Chinese citizen Alice Huang while she worked at Megaspeed International, a company working with Nvidia to build data centers in Asia. The executive is not related to Jensen Huang, and the person’s current whereabouts are unclear. China’s embassy in Washington firmly rejected the allegations. An Nvidia spokesman said the company was confident that the U.S. government would identify anyone who posed a threat to American industry, and argued that Jensen Huang’s relationship with the executive was not unusual given their business ties. The report therefore presents an unresolved national-security allegation rather than a confirmed finding. It also places the episode’s technology-market concerns in a broader context: alongside fears about AI spending and cyberattacks, U.S. officials are scrutinizing the international networks supporting the construction of AI data centers.

Intel shares fell more than 25% in after-hours trading after the company reported disappointing third-quarter results. Intel cited supply-chain constraints following an incident at a factory in Israel and continuing pressure on its personal-computer business. CFO Dave Zinsner said persistently high memory-chip prices would hurt the company’s total addressable market, which he expects to decline 10% on a unit basis next year. He added that Intel does not expect conditions to improve in 2027, though it will reassess the outlook in 2028. The drop followed the previous day’s Alphabet selloff, in which the company lost roughly half a trillion dollars in market value. Amazon shares declined about 7% despite $20 billion in quarterly net income and the company’s strongest cloud growth in years. Analysts said investors wanted even faster acceleration from AWS. Amazon’s free cash flow is falling as it plans to spend $220 billion this year, largely on AI data centers. CEO Andy Jassy acknowledged that the spending is a large number but said Amazon can fund it and that the opportunity could permanently change the company’s size. Rivian was a relative bright spot: the EV maker raised guidance after quarterly deliveries rose about 50%, reaching nearly 20,000 vehicles, although analysts still expect it to lose money until 2030. Roblox shares fell 17% after declining user and engagement measures, despite strong performance from AI-generated games and assets; executives said the effect of next month’s console-only Grand Theft Auto VI release was too difficult to estimate. BP, meanwhile, reported sharply higher third-quarter profits and cash flow, helping it pay down debt.

National politics reporter Ken Thomas describes a moderate Democratic strategy for the 2026 congressional races. While earlier coverage focused on Democratic Socialists winning primaries in deep-blue urban districts, Democrats are now emphasizing candidates who can compete in purple districts likely to determine control of the House. A group called the Hellcats includes Marine veteran Joanna Mendoza of Arizona, Army veteran Kate Conley of New York and former Navy helicopter pilot Rebecca Bennett of New Jersey. The candidates have worked together and are presenting themselves as veterans deeply involved in their communities who would bring a moderate outlook to Congress. Thomas compares the approach with 2018, when Democrats won seats with progressive figures such as Alexandria Ocasio-Cortez, Ayanna Pressley and Rashida Tlaib, while also electing many military veterans from more competitive districts. The Hellcats are campaigning primarily on affordability rather than cultural issues: voters face inflation, gasoline prices above $5 a gallon in many places and even higher diesel prices. They support making health care more affordable and pushing back on the president’s tariffs, including those involving Canada. If elected, these moderates could clash with progressive Democrats over Medicare for All, defunding ICE and impeachment efforts against President Trump or cabinet officials such as Defense Secretary Pete Hegseth. Thomas says moderates will want to keep the party focused on pocketbook issues rather than actions that could alienate suburban voters.

The episode closes with a warning for last-minute Halloween shoppers. Columnist Christopher Mims says candy prices have risen more than 70% in five years, and Luke Vargas notes that his favorite dark-chocolate bars cost about twice as much as they did before the pandemic. Mims attributes the cocoa squeeze to extreme weather, including droughts and floods that damaged crops in Africa, combined with years of government mismanagement in cocoa-producing countries. Many subsistence farmers cannot earn enough to improve growing methods or expand production, leaving supply constrained. Mims describes two possible technological responses. At the premium end, companies could grow cocoa cells in laboratories and process them into chocolate that is biologically identical to conventional chocolate, even though it never grew on a tree. At the cheaper end, confectioners are experimenting with substitutes such as roasted grape seeds that are designed to taste like chocolate. The reporter tested one alternative and said it would not fool anyone as dark or milk chocolate, although it worked acceptably on chocolate-covered almonds and might be hard to distinguish from ordinary chocolate chips in a cookie. The conclusion was that substitutes may work better in processed candy than as a replacement for a chocolate bar.