The US crypto market saw a significant shift in 2024 as the Securities and Exchange Commission authorised the first crypto-asset-backed exchange-traded funds (ETFs).
Regulated ETFs allowed institutional investors, including hedge funds and banks, to invest in Bitcoin and Ether, with assets reaching USD 115 billion and USD 17 billion, respectively, by November 2025.
Nearly 2,000 institutional investors gained exposure to Bitcoin ETFs in 2024, accounting for approximately 30% of the market by year-end. Hedge funds and asset managers led investments, while major banks acted as market makers and asset managers, boosting crypto-ETF growth.
The SEC’s 2025 authorisation of direct crypto-asset exchanges between broker-dealers and ETF issuers also enhanced market efficiency. Institutions increasingly use futures contracts to leverage positions and arbitrage between spot ETFs and futures markets.
Hedge funds often hold short positions in futures to profit from price differences, while asset managers and pension funds maintain net long positions. ETFs provide greater liquidity and lower transaction costs compared with direct crypto holdings.
Systemic risk concerns grow as a few custodians, including Coinbase with 80% of crypto-assets, dominate the market. Volatility, liquidity gaps, and concentrated custody could transmit crypto shocks to the wider financial system, underscoring the need for regulatory oversight.
Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot!
The European Commission has proposed extending the Interim Regulation that allows online service providers to voluntarily detect and report child sexual abuse instead of facing a legal gap once the current rules expire.
These measures would preserve existing safeguards while negotiations on permanent legislation continue.
The Interim Regulation enables providers of certain communication services to identify and remove child sexual abuse material under a temporary exemption from e-Privacy rules.
Without an extension beyond April 2026, voluntary detection would have to stop, making it easier for offenders to share illegal material and groom children online.
According to the Commission, proactive reporting by platforms has played a critical role for more than fifteen years in identifying abuse and supporting criminal investigations. Extending the interim framework until April 2028 is intended to maintain these protections until long-term EU rules are agreed.
The proposal now moves to the European Parliament and the Council, with the Commission urging swift agreement to ensure continued protection for children across the Union.
Would you like to learn more aboutAI, tech and digital diplomacy? If so, ask our Diplo chatbot!
From 1 February, the US Transportation Security Administration will charge a $45 fee to travellers who arrive at airports without a valid form of identification, such as a REAL ID or passport.
A measure that is linked to the rollout of a new alternative identity verification system designed to modernise security checks.
The fee applies to passengers using TSA Confirm.ID, a process that may involve biometric or biographic verification. Even after payment, access to the secure area is not guaranteed, and the charge will remain non-refundable, valid for a period of ten days.
According to the TSA, the policy ensures that the traveller, instead of taxpayers, bears the cost of verifying insufficient identification. Officials have urged passengers to obtain a REAL ID or other approved documentation to avoid delays or missed flights.
The agency has indicated that travellers will be encouraged to pay the fee online before arrival. At the same time, further details are expected on how advance payment and verification will operate across different airports.
Would you like to learn more aboutAI, tech and digital diplomacy? If so, ask our Diplo chatbot!
Britain plans to banAI-nudification apps that digitally remove clothing from images. Creating or supplying these tools would become illegal under new proposals.
The offence would build on existing UK laws covering non-consensual sexual deepfakes and intimate image abuse. Technology Secretary Liz Kendall said developers and distributors would face harsh penalties.
Experts warn that nudification apps cause serious harm, mainly when used to create child sexual abuse material. Children’s Commissioner Dame Rachel de Souza has called for a total ban on the technology.
Child protection charities welcomed the move but want more decisive action from tech firms. The government said it would work with companies to stop children from creating or sharing nude images.
Would you like to learn more about AI, tech, and digital diplomacy? If so, ask our Diplo chatbot!
Technology giant IBM has announced a major education initiative to skill 5 million people in India by 2030 in frontier areas such as AI, cybersecurity and quantum computing.
The programme will be delivered via IBM’s SkillsBuild ecosystem, which offers over 1,000 courses and has already reached more than 16 million learners globally.
The initiative will span students and adult learners across schools, universities and vocational training ecosystems, with partnerships planned with bodies such as the All India Council for Technical Education (AICTE) to integrate hands-on learning, curriculum modules, faculty training, hackathons and internships.
IBM also plans to strengthen foundational AI skills at the school level by co-developing curricula, teaching resources and explainers to embed computational thinking and responsible AI concepts early in education.
The CEO of IBM has described India as having the talent and ambition to be a global leader in AI and quantum technologies, with broader access to these skills seen as vital for future economic competitiveness and innovation.
Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot!
A video circulating online, purported to show a US military officer announcing that the United States would take control of the Nigerian Army, is false.
Independent analysis has revealed that the clip was likely generated or heavily manipulated using AI, and no official announcement or credible source supports this claim.
Fact-checkers used AI-detection tools and found high levels of manipulation, and investigations uncovered inconsistencies in uniform insignia and microphones linked to non-existent media outlets. No verified reports indicate that US military forces are intervening in Nigerian defence operations.
The false claim has spread on platforms including X (formerly Twitter), generating alarm and misinterpretation about foreign military involvement in Nigeria.
Experts warn that deepfakes and AI-generated misinformation are becoming harder to spot without specialised tools and verification.
Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot!
The UK Foreign, Commonwealth and Development Office was hacked in October, according to minister Chris Bryant. Officials say there is a low risk to any individual from the breach.
Reports suggest that a Chinese group, Storm 1849, may have been involved, but Bryant cautioned that the perpetrator has not been confirmed. Tens of thousands of visa details could have been targeted, though the exact scope remains unclear.
The attack shares similarities with a 2024 campaign called ArcaneDoor, linked to state-sponsored actors. Cybersecurity experts warn that the incidents may be connected and highlight risks of large-scale data targeting.
Officials have quickly closed the vulnerability and continue to investigate the matter. Bryant emphasised that speculation is unhelpful and said the investigation could take some time to identify the responsible party.
Would you like to learn more about AI, tech, and digital diplomacy? If so, ask our Diplo chatbot!
Russia has reported a sharp decline in cyber fraud following the introduction of new regulatory measures in 2025. Officials say legislative action targeting telephone and online scams has begun to deliver measurable results.
State Secretary and Deputy Minister of Digital Development Ivan Lebedev told the State Duma that crimes covered by the first package of reforms, known as ‘Cyberbez 1.0’, have fallen by 40%, according to confirmed statistics.
Earlier this year, Lebedev said Russia records roughly 677,000 cases of phone and online fraud annually, with incidents rising by more than 35% since 2022, highlighting the scale of the challenge faced by authorities.
In April, President Vladimir Putin signed a law introducing a range of countermeasures, including a state information system to combat fraud, limits on unsolicited marketing calls, stricter SIM card issuance rules, and new compliance obligations for banks.
Further steps are now under discussion. Officials say a second package is being prepared, while a third set of initiatives was announced in December as Russia continues to strengthen its digital security framework.
Would you like to learn more about AI, tech, and digital diplomacy? If so, ask our Diplo chatbot!
For the first time, the UK has published a detailed, evidence-based assessment of frontier AI capabilities. The Frontier AI Trends Report draws on two years of structured testing across areas including cybersecurity, software engineering, chemistry, and biology.
The findings show rapid progress in technical performance. Success rates on apprentice-level cyber tasks rose from under 9% in 2023 to around 50% in 2025, while models also completed expert-level cyber challenges previously requiring a decade of experience.
Safeguards designed to limit misuse are also improving, according to the report. Red-team testing found that the time required to identify universal jailbreaks increased from minutes to several hours between model generations, representing an estimated forty-fold improvement in resistance.
The analysis highlights advances beyond cybersecurity. AI systems now complete hour-long software engineering tasks more than 40% of the time, while biology and chemistry models outperform PhD-level researchers in controlled knowledge tests and support non-experts in laboratory-style workflows.
While the report avoids policy recommendations, UK officials say it strengthens transparency around advanced AI systems. The government plans to continue investing in evaluation science through the AI Security Institute, supporting independent testing and international collaboration.
Would you like to learn more about AI, tech, and digital diplomacy? If so, ask our Diplo chatbot!
Cybersecurity researchers have uncovered a rapidly expanding Android botnet known as Kimwolf, which has already compromised approximately 1.8 million devices worldwide.
The malware primarily targets smart TVs, set-top boxes, and tablets connected to residential networks, with infections concentrated in countries including Brazil, India, the US, Argentina, South Africa, and the Philippines.
Analysis by QiAnXin XLab indicates that Kimwolf demonstrates a high degree of operational resilience.
Despite multiple disruptions to its command-and-control infrastructure, the botnet has repeatedly re-emerged with enhanced capabilities, including the adoption of Ethereum Name Service to harden its communications against takedown efforts.
Researchers also identified significant similarities between Kimwolf and AISURU, one of the most powerful botnets observed in recent years. Shared source code, infrastructure, and infection scripts suggest both botnets are operated by the same threat group and have coexisted on large numbers of infected devices.
AISURU has previously drawn attention for launching record-setting distributed denial-of-service attacks, including traffic peaks approaching 30 terabits per second.
The emergence of Kimwolf alongside such activity highlights the growing scale and sophistication of botnet-driven cyber threats targeting global internet infrastructure.
Would you like to learn more aboutAI, tech and digital diplomacy? If so, ask our Diplo chatbot!
