Economic

ESMA sets guidance for crypto perpetuals and CFDs

The European Securities and Markets Authority (ESMA) has clarified that many crypto-perpetual contracts, including those for Bitcoin and Ether, are likely to be classified as contracts for difference (CFDs).

Due to their leverage, complexity, and risk, these products should target a narrow audience, with distribution strategies aligned accordingly.

The announcement came as Kraken launched perpetual futures for ten tokenised assets, including major indices, gold, and top tech and crypto stocks. ESMA warned that mass marketing or promotions targeting inexperienced investors are inappropriate under its guidance.

Firms must ensure that derivatives falling within the CFD category comply with product intervention requirements. Requirements include leverage limits, risk warnings, margin close-outs, negative balance protection, and a ban on incentives or benefits.

Non-advised services must include an appropriateness assessment to protect investors from unsuitable offerings.

ESMA also emphasised the importance of identifying and managing conflicts of interest arising from these products. The statement seeks to ensure firms market and distribute leveraged crypto products responsibly.

Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot! 

Microsoft backs Australia’s next phase of digital government with new AI and cloud agreement

Australia’s rise to second place in the OECD Digital Government Index signals renewed momentum for national digital transformation.

A shift that comes as Microsoft signs a new five-year Volume Sourcing Arrangement with the Federal Government, designed to underpin modernisation across public services and create a secure, future-ready foundation for responsible AI adoption.

The agreement led by the Digital Transformation Agency gives agencies access to Microsoft Copilot, Azure, Microsoft 365, Dynamics 365 and a strengthened security and compliance framework instead of continuing reliance on ageing systems.

The arrangement sets clearer strategic pathways for innovation, procurement and skills development through an enhanced governance structure.

It recommits both sides to national security requirements, including the Security of Critical Infrastructure legislation, the Cloud Hosting Certification Framework and IRAP.

These measures allow agencies to expand AI use while retaining control of data and meeting the expectations placed on government institutions.

A successful Copilot trial in 2024 already demonstrated personal productivity gains of around one hour per day for participating staff.

Microsoft is also establishing a $1.55 million training fund for the Australian Public Service to support capability building in ethical AI use and modern cloud operations.

The company emphasises that Australia’s partner ecosystem will gain new opportunities because the agreement simplifies how local firms engage with government agencies. Such an approach forms an important part of the wider public sector reform agenda announced last year.

The new deal aligns with national priorities set out in the Whole-of-Government Cloud Computing Policy and the National AI Plan.

Australia now enters a pivotal period in which digital transformation is guided not only by technological capacity but by the frameworks of trust, resilience and public benefit that shape how government services evolve.

Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot!  

AI misuse exposed as OpenAI details global disinformation and scam networks

OpenAI said criminal and state-linked groups misused ChatGPT for disinformation, scams and covert influence. Its latest threat report details coordinated account bans and highlights how AI tools are embedded within broader operational workflows rather than used in isolation.

One investigation linked accounts to Chinese law enforcement engaged in what were described as ‘cyber special operations’. Activities included planning influence campaigns, mass-reporting dissidents and drafting forged materials, with related efforts continuing through other tools despite model refusals.

The report also outlined a Cambodia-based romance scam targeting young men in Indonesia through a fake dating agency. Operators combined manual prompting with automated chatbots to sustain conversations and facilitate financial fraud, leading to account removals.

Separately, accounts tied to Russia’s ‘Rybar’ network used ChatGPT to draft and translate posts distributed across multiple platforms. OpenAI noted that campaign impact depended more on account reach and coordination than on AI-generated content alone.

Across China, Russia and parts of Southeast Asia, actors treated AI as one tool among many, alongside fake profiles, paid advertising and forged documents. OpenAI called for cross-industry vigilance, stressing the need to analyse behavioural patterns across platforms.

Would you like to learn more about AI, tech, and digital diplomacy? If so, ask our Diplo chatbot!

Meta AI flood of unusable abuse tips overwhelms US investigators

Investigators in the US say that AI used by Meta is flooding child protection units with large volumes of unhelpful reports, thereby draining resources rather than assisting ongoing cases.

Officers in the Internet Crimes Against Children network told a New Mexico court that most alerts generated by the company’s platforms lack essential evidence or contain material that is not criminal, leaving teams unable to progress investigations.

Meta rejects the claim that it prioritises profit, stressing its cooperation with law enforcement and highlighting rapid response times to emergency requests.

Its position is challenged by officers who say the volume of AI-generated alerts has doubled since 2024, particularly after the Report Act broadened reporting obligations.

They argue that adolescent conversations and incomplete data now form a sizeable portion of the alerts, while genuine cases of child sexual abuse material are becoming harder to detect.

Internal company documents disclosed at trial show Meta executives raising concerns as early as 2019 about the impact of end-to-end encryption on the firm’s ability to identify child exploitation and support investigators.

Child safety groups have long warned that encryption could limit early detection, even though Meta says it has introduced new tools designed to operate safely within encrypted environments.

The growing influx of unusable tips is taking a heavy toll on investigative teams. Officers in the US say each report must still be reviewed manually, despite the low likelihood of actionable evidence, and this backlog is diminishing morale at a time when they say resources have not kept pace with demand.

They warn that meaningful cases risk being delayed as units struggle with a workload swollen by AI systems tuned to avoid regulatory penalties rather than investigative value.

Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot!  

Colorado targets AI chatbot safety

AI chatbots operating in Colorado would face new child safety and suicide prevention requirements under a bipartisan bill introduced in the Colorado legislature. Lawmakers say the measure addresses parents to concerns about harmful chatbot interactions.

House Bill 1263 would require companies to clearly inform children in Colorado that they are interacting with AI rather than a real person. Platforms would also be barred from offering engagement rewards to child users.

The proposal mandates reasonable safeguards to prevent sexually explicit content and to stop chatbots from encouraging emotional dependence, including romantic role-playing. Parental control options would also be required where services are accessible to children in Colorado.

Companies would need to provide suicide prevention resources when users express self-harm thoughts and report such incidents to the Colorado attorney general. Violations would be treated as consumer protection infractions, carrying fines of up to $1,000 per occurrence in Colorado.

Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot! 

Conduent breach exposes data of 25 million people across US

More than 25 million people across the United States have had personal information exposed following a ransomware attack on government contractor Conduent. Updated state breach notifications indicate the incident is larger than initially understood.

Conduent provides printing, payment processing, and benefit administration services for state agencies and large corporations. Its systems support food assistance, unemployment benefits, and workplace programmes, reaching more than 100 million individuals, according to the company.

US State disclosures show Oregon and Texas account for most of the affected records, with additional cases reported in Massachusetts, New Hampshire, and Washington. Compromised data includes names, dates of birth, addresses, Social Security numbers, health insurance information, and medical details.

Public information from Conduent has been limited since the January 2025 attack. An incident notice published in October carried a ‘noindex’ tag in its source code, preventing search engines from listing the page, which critics say reduced visibility for affected individuals.

The breach ranks among the largest recent ransomware incidents, though it is smaller than the 2024 Change Healthcare attack that affected 190 million people. Regulators and affected users continue seeking clarity on the Conduent case and its security failures.

Would you like to learn more about AI, tech, and digital diplomacy? If so, ask our Diplo chatbot!

Anthropic faces data theft claims from Musk

Elon Musk, CEO of Tesla and xAI, has publicly accused Anthropic of stealing large volumes of data to train its AI models. The allegation was made on X in response to posts referencing Community Notes attached to Anthropic-related content.

Musk claimed the company had engaged in large-scale data theft and suggested that it had paid multi-billion-dollar settlements. Those financial claims remain contested, and no official confirmation has been provided to substantiate the figures.

Anthropic, known for developing the Claude AI model, was founded by former OpenAI employees and promotes an approach centred on AI safety and responsible development. The company has not publicly responded to Musk’s latest accusations.

The dispute reflects a broader conflict across the AI industry over how companies collect the text, images and other materials required to train large language models. Much of this data is scraped from the internet, often without explicit permission from rights holders.

Multiple lawsuits filed by authors, media organisations and software developers are testing whether large-scale scraping qualifies as fair use under copyright law. Court rulings in these cases could reshape licensing practices, impose financial penalties, and alter the economics of AI development.

Would you like to learn more about AI, tech, and digital diplomacy? If so, ask our Diplo chatbot!

CarGurus data leak surfaces as ShinyHunters publishes archive

The ShinyHunters extortion group has published a 6.1GB archive, which it claims contains more than 12 million records stolen from CarGurus, a US-based automotive platform. Have I Been Pwned listed the dataset, reporting that roughly 3.7 million records appear to be new.

The exposed information includes email addresses, IP addresses, full names, phone numbers, physical addresses, user account IDs, and finance-related application data belonging to CarGurus users. Dealer account details and subscription information were also reportedly included in the archive.

CarGurus has not issued a public statement confirming a breach. However, Have I Been Pwned said it attempts to verify the authenticity of datasets before adding them to its database, suggesting a level of validation of the leaked material.

Security experts warn that the availability of the data could increase the risk of phishing. Users are advised to remain cautious of unsolicited communications and potential scams that may leverage the exposed personal information.

ShinyHunters has recently claimed attacks against multiple large organisations across telecoms, fintech, retail, and media. The group is known for using social engineering tactics, including voice phishing and malicious OAuth applications, to gain access to SaaS platforms and extract customer data.

Would you like to learn more about AI, tech, and digital diplomacy? If so, ask our Diplo chatbot!

AI automation quietly reshapes core insurance operations

A Business Reporter analysis notes that AI in the insurance sector has progressed from pilots and back-office experiments to core operational automation, spanning underwriting, claims processing, customer servicing, document interpretation and financial workflows.

This shift is driven by the need to reduce high operating costs, estimated at roughly 22% of global premiums, which have long limited the industry’s growth and agility.

Modern AI systems are increasingly deployed as intelligent processing layers that interpret applications, policy documents and financial records, route work, reconcile data and assist human judgement without requiring wholesale replacement of legacy systems.

Insurers see potential for real-time underwriting support, dramatically faster claims intake and near-instant reconciliation of finance tasks, enabling staff to shift focus from repetitive administration to higher-value activities such as risk assessment, customer relationships and portfolio insights.

The commentary suggests that resistance to broader AI adoption in insurance is cultural rather than technical, as the industry’s traditionally cautious stance can slow integration even when automation delivers measurable value.

The core message is that AI’s role in insurance is not to replace humans but to remove friction and elevate human work by automating routine functions efficiently and at scale.

Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot!

UiPath launches agentic AI to streamline healthcare operations

UiPath has unveiled new agentic AI solutions for healthcare providers and payers. The tools focus on medical record summarisation, claim denial prevention, and prior authorisation, connecting data to speed workflows and improve efficiency.

Healthcare organisations face labour shortages and fragmented systems, making revenue cycle management challenging. Providers produce large volumes of clinical documentation that must be quickly turned into actionable insights for accurate reimbursement.

The platform converts records into concise, citation-backed summaries, automates claim review and appeals, and streamlines eligibility checks. AI predicts risks, reduces errors, and accelerates clinical and administrative processes for providers and payers alike.

UiPath partners with innovators such as Genzeon to embed domain expertise. The solution addresses rising costs, complex regulations, and labour challenges, helping teams make data-driven decisions and improve patient outcomes.

Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot! 

Diplo chatbot can make mistakes. Consider checking important information.