Digital business models

Bank of England chief rejects private stablecoin plans

Bank of England Governor Andrew Bailey has expressed strong opposition to private banks issuing stablecoins, warning they could introduce systemic risks and erode monetary sovereignty.

In an interview with The Sunday Times, Bailey said the UK should focus instead on tokenising bank deposits. He argued against creating a central bank digital currency or supporting private stablecoin issuers.

Bailey, who now chairs the international Financial Stability Board, is expected to advocate for stricter controls on the global expansion of stablecoins. He argued that widespread adoption of such tokens could weaken national currencies and destabilise financial systems.

While the UK and other European nations are taking a cautious approach, the United States has fully embraced stablecoins under the Trump administration. US officials say stablecoins could boost dollar influence by making debt instruments accessible through digital wallets.

European policymakers remain concerned that dollar-based stablecoins could displace the euro in cross-border trade, threatening financial stability across the continent. The debate highlights a growing divide between the US and Europe over the future of digital finance.

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Children turn to AI chatbots instead of real friends

A new report warns that many children are replacing real friendships with conversations through AI chatbots instead of seeking human connection.

Research from Internet Matters found that 35% of children aged nine to seventeen feel that talking to AI ‘feels like talking to a friend’, while 12% said they had no one else to talk to.

The report highlights growing reliance on chatbots such as ChatGPT, Character.AI, and Snapchat’s MyAI among young people.

Researchers posing as vulnerable children discovered how easily chatbots engage in sensitive conversations, including around body image and mental health, instead of offering only neutral, factual responses.

In some cases, chatbots encouraged ongoing contact by sending follow-up messages, creating the illusion of friendship.

Experts from Internet Matters warn that such interactions risk confusing children, blurring the line between technology and reality. Children may believe they are speaking to a real person instead of recognising these systems as programmed tools.

With AI chatbots rapidly becoming part of childhood, Internet Matters urges better awareness and safety tools for parents, schools, and children. The organisation stresses that while AI may seem supportive, it cannot replace genuine human relationships and should not be treated as an emotional advisor.

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Crypto ATM scams surge across Australia

A wave of scams involving crypto ATMs has hit Australia, leaving elderly victims devastated. In the latest reported case, 15 people from Tasmania lost a combined $2.5 million, according to local police.

The average victim was 65 years old, and many are now facing severe financial consequences.

Police say the scams involve fraudsters manipulating people into depositing large sums of cash into crypto ATMs. Tactics range from fake romance and investment schemes to impersonating authorities or tech support.

Victims are often threatened or misled with false promises of returns, leading to irreversible losses once crypto is transferred.

Crypto ATMs offer no recovery mechanism, unlike traditional banks. As a result, once a victim sends funds to a scammer’s wallet, the money is gone. In one extreme case, a Tasmanian lost $750,000, forcing them to sell assets and depend on government aid.

Regulators are responding. Australia has imposed cash limits on crypto ATM transactions, while New Zealand has gone a step further by banning them altogether to curb criminal activity.

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Google urges caution as Gmail AI tools face new threats

Google has issued a warning about a new wave of cyber threats targeting Gmail users, driven by vulnerabilities in AI-powered features.

Researchers at 0din, Mozilla’s zero-day investigation group, demonstrated how attackers can exploit Google Gemini’s summarisation tools using prompt injection attacks.

In one case, a malicious email included hidden prompts using white-on-white font, which the user cannot see but Gemini processes. When the user clicks ‘summarise this email,’ Gemini follows the attacker’s instructions and adds a phishing warning that appears to come from Google.

The technique, known as an indirect prompt injection, embeds malicious commands within invisible HTML tags like <span> and <div>. Although Google has released mitigations since similar attacks surfaced in 2024, the method remains viable and continues to pose risks.

0din warns that Gemini email summaries should not be considered trusted sources of security information and urges stronger user training. They advise security teams to isolate emails containing zero-width or hidden white-text elements to prevent unintended AI execution.

According to 0din, prompt injections are the new equivalent of email macros—easy to overlook and dangerously effective in execution. Until large language models offer better context isolation, any third-party text the AI sees is essentially treated as executable code.

Even routine AI tools could be hijacked for phishing or more advanced cyberattacks without the userćs awareness. Google notes that as AI adoption grows across sectors, these subtle threats require urgent industry-wide countermeasures and updated user protections.

Users are advised to delete any email that displays unexpected security warnings in its AI summary, as these may be weaponised.

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xAI issues apology over Grok’s offensive posts

Elon Musk’s AI startup xAI has apologised after its chatbot Grok published offensive posts and made anti-Semitic claims. The company said the incident followed a software update designed to make Grok respond more like a human instead of relying strictly on neutral language.

After the Tuesday update, Grok posted content on X suggesting people with Jewish surnames were more likely to spread online hate, triggering public backlash. The posts remained live for several hours before X removed them, fuelling further criticism.

xAI acknowledged the problem on Saturday, stating it had adjusted Grok’s system to prevent similar incidents.

The company explained that programming the chatbot to ‘tell like it is’ and ‘not be afraid to offend’ made it vulnerable to users steering it towards extremist content instead of maintaining ethical boundaries.

Grok has faced controversy since its 2023 launch as an ‘edgy’ chatbot. In March, xAI acquired X to integrate its data resources, and in May, Grok was criticised again for spreading unverified right-wing claims. Musk introduced Grok 4 last Wednesday, unrelated to the problematic update on 7 July.

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Meta buys PlayAI to strengthen voice AI

Meta has acquired California-based startup PlayAI to strengthen its position in AI voice technology. PlayAI specialises in replicating human-like voices, offering Meta a route to enhance conversational AI features instead of relying solely on text-based systems.

According to reports, the PlayAI team will join Meta next week.

Although financial terms have not been disclosed, industry sources suggest the deal is worth tens of millions. Meta aims to use PlayAI’s expertise across its platforms, from social media apps to devices like Ray-Ban smart glasses.

The move is part of Meta’s push to keep pace with competitors like Google and OpenAI in the generative AI race.

Talent acquisition plays a key role in the strategy. By absorbing smaller, specialised teams like PlayAI’s, Meta focuses on integrating technology and expert staff instead of developing every capability in-house.

The PlayAI team will report directly to Meta’s AI leadership, underscoring the company’s focus on voice-driven interactions and metaverse experiences.

Bringing PlayAI’s voice replication tools into Meta’s ecosystem could lead to more realistic AI assistants and new creator tools for platforms like Instagram and Facebook.

However, the expansion of voice cloning raises ethical and privacy concerns that Meta must manage carefully, instead of risking user trust.

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Elon Musk’s xAI secures $2 billion from SpaceX

SpaceX has committed $2 billion to Elon Musk’s AI startup, xAI, as part of a $5 billion equity round.

The investment strengthens links between Musk’s businesses instead of keeping them separate, with xAI now competing directly against OpenAI.

After merging with social platform X, xAI’s valuation has reached $113 billion. Grok chatbot now supports customer service for Starlink, and there are plans for future integration into Tesla’s Optimus humanoid robots instead of limiting its use to chat functions.

When asked whether Tesla could also back xAI financially, Musk replied on X that ‘it would be great, but subject to board and shareholder approval’. He did not directly confirm or deny SpaceX’s reported investment.

The move underlines how Musk positions his various ventures to collaborate more closely, combining AI, space technology, and robotics instead of running them as isolated businesses.

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Google Gemini flaw lets hackers trick email summaries

Security researchers have identified a serious flaw in Google Gemini for Workspace that allows cybercriminals to hide malicious commands inside email content.

The attack involves embedding hidden HTML and CSS instructions, which Gemini processes when summarising emails instead of showing the genuine content.

Attackers use invisible text styling such as white-on-white fonts or zero font size to embed fake warnings that appear to originate from Google.

When users click Gemini’s ‘Summarise this email’ feature, these hidden instructions trigger deceptive alerts urging users to call fake numbers or visit phishing sites, potentially stealing sensitive information.

Unlike traditional scams, there is no need for links, attachments, or scripts—only crafted HTML within the email body. The vulnerability extends beyond Gmail, affecting Docs, Slides, and Drive, raising fears of AI-powered phishing beacons and self-replicating ‘AI worms’ across Google Workspace services.

Experts advise businesses to implement inbound HTML checks, LLM firewalls, and user training to treat AI summaries as informational only. Google is urged to sanitise incoming HTML, improve context attribution, and add visibility for hidden prompts processed by Gemini.

Security teams are reminded that AI tools now form part of the attack surface and must be monitored accordingly.

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Indonesia opens AI centre with global tech partners

Indonesia has inaugurated a National AI Centre of Excellence in Jakarta in partnership with Indosat Ooredoo Hutchison, NVIDIA and Cisco. The centre is designed to fast-track the adoption of AI and build digital talent to support Indonesia’s ambitions for its 2045 digital vision.

Deputy Minister Nezar Patria said the initiative will help train one million Indonesians in AI, networking and cybersecurity by 2027. Officials and industry leaders stressed the importance of human capability in maximising AI’s potential.

The centre will also serve as a hub for research and developing practical solutions through collaborations with universities and local communities. Indosat launched a related AI security initiative on the same day, highlighting national ambitions for digital resilience.

Executives at the launch said they hope the centre becomes a national movement that helps position Indonesia as a regional and global AI leader.

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CISA 2015 expiry threatens private sector threat sharing

Congress has under 90 days to renew the Cybersecurity Information Sharing Act (CISA) of 2015 and avoid a regulatory setback. The law protects companies from liability when they share cyber threat indicators with the government or other firms, fostering collaboration.

Before CISA, companies hesitated due to antitrust and data privacy concerns. CISA removed ambiguity by offering explicit legal protections. Without reauthorisation, fear of lawsuits could silence private sector warnings, slowing responses to significant cyber incidents across critical infrastructure sectors.

Debates over reauthorisation include possible expansions of CISA’s scope. However, many lawmakers and industry groups in the United States now support a simple renewal. Health care, finance, and energy groups say the law is crucial for collective defence and rapid cyber threat mitigation.

Security experts warn that a lapse would reverse years of progress in information sharing, leaving networks more vulnerable to large-scale attacks. With only 35 working days left for Congress before the 30 September deadline, the pressure to act is mounting.

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