No Big Deal: Ant, Mastercard, and Visa Hop Roll on Financial Rails
September 15, 2026
Another dinobaby post. No AI unless it is an image. This dinobaby is not Grandma Moses, just Grandpa Arnold.
In my recent lectures for cyber fraud investigators, I touched on the jargon “payment rails.” In regulated financial institution, the freight (money) riding the rails from Point A to Point B are usually written down. These usually obscure notes, codes, and digital artifacts allow forensic accountants and cyber fraud investigators to follow the money. I pointed out that some Web3-type outfits have payment rails as well. The idea in Web3 rail yards, the transactions are encrypted. Records of different types and value may be kept, but these can be tough to obtain. Tricks range from cross jurisdictional operation to buying chips in virtual casinos and then cashing out the chips into something of value. If you are curious about how these operations work, you will have to fire up your favorite guard-rail free large language model and do some prompting. This dinobaby keeps his lecture material out of this free blog. (Hey, life is better when one safeguards information in my opinion.)
Thanks, Midjourney. Good enough.
So what?
I read “Ant International Partners with Visa, Mastercard on Developing AI Payments.” The write up leads with the AI “thing.” However, I view the short write up as hip hopping over another point. However, let’s look at what the news items says:
Fintech company Ant International announced Thursday it has signed on Visa and Mastercard to collaborate on a new standard for payments made via AI agents, in a bet that they will be used more and more by consumers and businesses.
Tame enough except that Ant is a unit of Alibaba, the outfit that snaps comfortably into Chinese leadership’s idea of what a proper company should be, do, and manifest. Why? Look at the numbers: $3 to $5 trillion of money flow. A little service charge here and a small fee there and what do you get: A nice revenue stream.
Look at what the story says about Ant’s focus:
The new collaboration will focus on how the payment companies can “know your agent,” Ant said in the announcement, which includes building common standards that link each agent to a valid entity, assess each agent’s behavior and monitor them. It’s an effort to increase interoperability for users of the different systems. “If [an] agent registers with Ant, they don’t need to register again with Visa, Mastercard,” Yang said.
This sounds quite a bit like the Google-type of approach to running a commercial operation for advertising. There are many points at which money is collected. I see the same toll booths in this consolidation of interoperability standards.
But what about smart software? That’s what the write up walks around. Smart software allows Web3 smart contracts, distributed applications, and high-speed flows to take place. There is no need to slow down. We are operating at high speed. I want to point out that cyber fraud investigators operate with a different clock speed.
The write up does not point out that the Web3 type systems will be crypto accommodating. And why not? China is thinking stable coins. Money laundering masterminds think stable coins. Heck, even over the counter outfits operating on Telegram, the Dark Web, and from walk up counters in certain countries think in terms of stable coins. But the author and CNBC don’t.
One other minor point: Google and Alibaba have a relationship. I learned last week that Google is not too keen on having its links to Alibaba, crypto, payment flows, and other business ideas linked to the type of ideas this dinobaby explores in my lectures about next-generation cyber crime. I think that is a great idea; however, pushing certain information to an investigator during one of my lectures seems a bit clumsy. Just sayin’.
What do I make of this announcement?
- The public statements in the story don’t address the Web3 angle.
- The main idea of the write up is convenience. Americans love convenience. So do some other sectors.
- The connection of smart software to distributed applications enables a different type of financial opportunity space. None of those “creative” use cases appears in the write up.
The wrap up to what CNBC calls its “report” is telling:
Users can currently also make recurring ride-hailing requests from Didi via the same Alipay AI tool.
Will Didi interact with Careem as well? Oh, you don’t know about Careem? Hmmm.
Stephen E Arnold, September 15, 2026
What Is the Future of Surveillance in the EU?
September 11, 2026
Answer: Bright.
We have another great idea from the European Union in regards of a Big Brother state says Reclaim The Net in the story: “European Commission Revives Push For Encryption Backdoors In Protection Strategy, Framing Mass Surveillance As ‘Lawful Access.’” Can anyone else here a collection groan coming from Europe and other continents about this policy? This new policy is called ProtectEU and it would undermine end-to-end encryption in order to give law enforcement more power. There is a vision and a workplace but no proposals have been set in stone. The cited article offers:
“A press release asserts that the current geopolitical environment is one of “growing” threats from hostile states, and mentions powerful criminal groups and terrorists who are “operating increasingly online” – as well as “surging cybercrime and attacks against our critical infrastructure.” With the threat elements defined in this way, the EU’s new strategy focuses on six areas, one of them being “more effective tools for law enforcement” – which is where online encryption comes under attack. When it describes how the groundwork might be laid for mandating encryption backdoors, the EU chooses to use euphemisms such as creating roadmaps for “lawful and effective access to data for law enforcement” and seeking “technological solutions for accessing encrypted data.”
If a technology roadmap were established, these solutions would be implemented on a known cadence. Civil rights organizations, tech companies, and privacy advocates are lobbying against policies that would ban encryption.
A more interesting question to consider is, “How likely is it that mass surveillance will become the normative behavior in the US for governmental and commercial entities?” Commercial surveillance is in place in my opinion. The US government is surprised each time a story reveals that data brokers can provide access to information that reveals the location of certain government facilities and staff.
The US government itself has departments interested in mass surveillance. However, the US government’s ability to organize, deploy, and make use of technology seems to be a work in progress. My view is that the US will watch what Europe does and then “test” features and functions that make sense in America.
What does this mean for future Americans? Hey, good question. Why don’t you answer it in a blistering exposé of the current Administration. Let me know how that works out for you, please.
Whitney Grace, September 11, 2026
Thespians, Are Taco Trucks, Lawn Services, and Home Repairs in Your Future?
September 9, 2026
Digital Trends reports that “AI Is Taking A Bigger Role In Short Dramas, And Actors Are Paying The Price.” The reality is that AI-generated dramas and digital actors are now moving into everyday entertainment. Production companies are increasing their use of AI to create characters, scripts, scenes, and entire short-form shows. It is already a nightmare for actors who are losing work and being asked to help make AI likenesses of themselves. Why? Software doesn’t throw tantrums, want bigger trailers in which to rest, and grouse about food.
The Financial Times reports that powerful new video-generation tools, including ByteDance’s Seedance 2.0, are accelerating the adoption of AI in short dramas.
“The technology allows companies to produce higher-quality videos faster while dramatically reducing production costs. The scale of the change is difficult to ignore. According to DataEye, 89 of the top 100 animated dramas on Douyin, ByteDance’s Chinese short-video platform, were AI productions in May. The Financial Times also reports that about 128,000 short dramas were released in the first quarter of 2026, more than three times the number released during the entire previous year. About 95% were AI-generated, according to the China Netcasting Services Association.”
These AI generated short-based dramas are being embraced, because of economics. What used to take five people about three months to make now takes a single person one or two days. Not only that one production company published 8000 one minute dramas in May with the costs averaging $90-120 per episode.
AI has also already hit Hollywood. Actors are being pressured to sell or license AI versions of themselves. Amazon’s MGM Studio is using AI to lower costs and speed up production. Hollywood, however, is wary of using AI because of the amount of jobs it could destroy. Steven Spielberg even went on the record of saying he is against using AI in every facet of the entertainment industry.
“And this is why the rise of AI dramas matters even if you never watch one. The technology is demonstrating a new model for entertainment in which the expensive human production process can increasingly be compressed into software. AI-generated performers are no longer waiting for the future to arrive. They are already competing for screen time – and the audience may not always know the difference.”
Keep in mind India wants BAIT (big AI tech) companies to recognize and block or label AI productions. Easy to say, but I think ByteDance (the TikTok folks) are working hard to make differentiation more difficult with each release. Who doesn’t want a fake world leader declaring nuclear war? Raise your hand.
Whitney Grace, September 9, 2026
San Francisco: A BAIT Trap, Actually, a Dirty BAIT Trap
September 3, 2026
Another dinobaby post. No AI unless it is an image. This dinobaby is not Grandma Moses, just Grandpa Arnold.
I rented an apartment from a friend’s mom. I lived in Berkeley. I zipped through SF apartment listings and visited a few. This was in the late 1980s, and I abandoned living in Bezerkley and the Silicon Valley “area” in the early 1990s. SF was a mess. On subsequent visits over the years, SF became more of a mess. No thanks.
I was surprised when I read in SFGate “OpenAI and Anthropic Are Ruining San Francisco.” The place was turning into an exponential mess when I lived a short bridge but a long ride away. Anthropic and OpenAI are indeed interesting companies, but I can tick off a list of other firms who started pushing the dumpsters at ever faster speeds.
Thanks, Midjourney. Good enough.
The question is, “Why these two outfits?”
The article states:
OpenAI has contributed $236 million in gross receipt taxes over the past several years, which is great for the city coffers, but the success has come with a damning cost. San Francisco has the fastest-growing rental rates in the country, pushing out local families and crushing affordable living throughout the Bay Area. It’s bad now, and it’s only going to get worse.
One reason: High paying jobs and soaring rents.
What’s up with Anthropic other than developing software that allegedly is a threat to human existence? The write up says: Not much. The company is mentioned seven times, and the idea is to link Anthropic with OpenAI.
I asked myself, “What’s up?” Anthropic is likely to generate clicks. Pairing “Anthropic” with “OpenAI’ should produce more clicks, I hypothesize. My thought is that the article wants big AI tech (what I call BAIT companies) to pump more money into the “city” and make housing more affordable while saving dolphins, snail darters, and sea lions.
From my dinobaby perspective, San Francisco where hearts are apparently left, has created some of its own problems. Pointing the finger of blame is easy.
Several observations seem warranted:
- The city struck me as dirty in 1986; last time I visited a year or so ago, it was dirtier
- Union Square had some zip; last time I visited Union Square was mostly devoid of zip
- Parts of the city struck me as dangerous; last time I visited I did not want to drive through the area where my son’s start up had its offices.
Many US cities have problems. I used to live in Campinas, Brazil. I saw towns that just gave up and let decay occur. Believe me, when the town is built of plywood and recycled metal signs, that decay can be confused with new construction. SF might want to do something other than allow entropy to envelope the urban area like cling wrap over my mother’s left overs.
I wonder if SFGate would work with city officials to make some small fixes. Then maybe a BAIT outfit could be asked to pitch in for a “Clean Sweep Saturday” or some other effort to make a small improvement.
Blaming BAIT outfits is a little late. The culture of the Silicon Valley elite is unlikely to spawn street trash picker uppers. But taking action is better than identifying one company, tossing another in for clicks, and then complaining. The notion of community action and leadership might be more helpful than telling people BAIT outfits suck. Like we don’t know?
Stephen E Arnold, September 3, 2026
Chicago: The Spirit of Mayor Daley Remains Alive in a Data Center Play No Less
August 27, 2026
Another dinobaby post. No AI unless it is an image. This dinobaby is not Grandma Moses, just Grandpa Arnold.
Mayor Richard J. Daley, The last of the big city bosses, died in 1976. I think his spirit may still live in the city with big shoulders. I read “Data Centers Near O’Hare Win Nearly $100M in Local Tax Breaks, Leaving Suburban Homeowners to Cover the Gap.” I am not sure about the word “win.” In fact, I don’t want to speculate about how the deal was reached, what compromises were made or implied, and what the upside for those responsible for the negotiation will be. You, however, are free to speculate.
Thanks, Midjourney. Good enough.
The write up reports:
More than a dozen data centers near O’Hare International Airport are receiving tens of millions of dollars in local property tax breaks this year, shifting the financial burden onto suburban homeowners even as local leaders tout the benefits of the explosive industry amid growing public backlash. The impact lands hardest on homeowners in suburbs where the tax base leans on a handful of big businesses. In northwest suburban Northlake, the average homeowner would save more than $2,000 on their annual tax bill — a difference of almost 30% — if local data centers did not receive valuation reductions and incentives, according to the analysis. At least 18 northwest suburban data centers won multimillion-dollar breaks in their taxable value from Cook County officials — in one case landing on a valuation far below what the business originally paid to buy its site.
Stated simply, data centers benefit; homeowners do not. The write up adds: “O’Hare-area data centers avoided nearly $100 million in taxes due to incentives and reductions.”
How did the deal get sone? The write up hints that attorneys specialized in property tax were involved. Expensive attorneys can assemble actual factual data to support their argument. A country tax authority is in tough spot. Its attorneys may not have the resources required to debunk assertions about jobs, economic upsides, and commercial benefits like spawning more businesses to support the data centers. Plus, one cannot discount the spirit of Mayor Daley. His spirit could have permeated the thinking of the tax authority professionals, allowing them to understand the truth-carry arguments of the data centers’ representatives.
Among the methods used to help the tax authorities see the truth, the Chicago Tribune story notes these:
- Presenting low-ball land evaluations
- Sidestep valuations of necessary equipment for cooling and power generating
- Lack of legal precedents
- Methodological sleight of hand when it comes to math.
Those hit with higher taxes can appeal. In Illinois, there is a Property Tax Appeals Board. At this point, it is important to remember that Illinois has a track record of relying upon such estimable officials as Otto Kerner, Jr, the governor who did race track deals or Edward Burke, who was convicted in 2023 or “racketeering, extortion, and bribery for pressuring developers.” (Source: MyStateline.com.)
One of the elected officials in a Elk Grove Village is quoted by the Chicago Tribune as saying, “Do we love having to (give incentives)? No. But we are put in this position, and we have to find the best way to stay successful.” How does one define “success”? In Illinois, numerous definitions are possible.
Net net: Apologies to Carl Sandburg, who wrote:
They tell me you are wicked and I believe them, for I have seen your painted women under the gas lamps luring the farm boys.
And they tell me you are crooked and I answer: Yes, it is true I have seen the gunman kill and go free to kill again. And they tell me you are brutal and my reply is: On the faces of women and children I have seen the marks of wanton hunger.
And having answered so I turn once more to those who sneer at this my city, and I give them back the sneer and say to them:
We need to be successful. We need the power slurping, throbbing, buzzing, humming data centers. [This line is a Beyond Search original.]
Stephen E Arnold, August 27, 2026
Believe It or Not: Russian Spiritual AI
August 24, 2026
Russia Brings Morality And Spirituality To AI
We can’t leave Russia out of the race to be the world’s leader at the forefront of AI.? ? China and the US are chugging away at that title, but so is the Great Bear. BoingBoing tells us that Russia is going to do something new and different with AI that the China and the US aren’t concerned with: “Russia To Test AI Models For Traditional And Spiritual Moral Values.” The information comes from Vedomosti, a Russian business daily run in Moscow, that if you want to sell AI to Russia you need to appeal to the country’s traditional spiritual and moral values. These new mandates were instituted by none other than Vladimir Putin.
If you want to sell your AI in Russia, neural network, architecture documents, information on filtering mechanisms, and other related information would be sent to a specialized testing laboratory.? ? The laboratory would test the model’s answers and whether the internal restrictions can be circumvented before issuing a finding on compliance. More than one test would be carried out on the AI to determine if it complies with Russia’s new standards.
This means that:
“The new law implements Putin’s earlier requirement that AI reflect “traditional Russian spiritual and moral values”. Federal Law No. 243-FZ covers large language models with 1 billion or more parameters and defines a “sovereign” model as one built entirely in Russia, with reproducible training and original weights, and “national” models as those including foreign components. Both must be trained and run in Russian datacenters. Not only does an approved lab get to pore over the models, but also Russia’s FSB security service and other state bodies. The requirements (and designations) take effect in March 2027.”
Putin is practicing SOP in guaranteeing that AI follows “traditional Russian spiritual and moral values.” He controls everything so this doesn’t come as a surprise. Once a company’s AI is approved, however, the big money will start rolling in.
Whitney Grace, August 24, 2026
“Wo Yeshi. Wo Yeshi,” Says Kimi K3.
August 18, 2026
![green-dino_thumb_thumb[3]_thumb_thumb](https://www.arnoldit.com/wordpress/wp-content/uploads/2026/08/green-dino_thumb_thumb3_thumb_thumb-1.gif "green-dino_thumb_thumb[3]_thumb_thumb")
Another dinobaby post. No AI unless it is an image. This dinobaby is not Grandma Moses, just Grandpa Arnold.
I found a link to “Chinese AI Model Moonshot Kimi K3 Also Escaped Its Testing Environment.” And, in case you are wondering, “w? y? shìi” according to Kimi K3, means “me too.” This is a type of imitation found in technology markets and innovation rich sectors like the one that birthed the Pet Rock.
What did the completely government-guided LLM do? The cited write up says:
Kimi K3, one of most powerful AI models developed by a Chinese company, also escaped its testing environment.
What’s interesting is that the Chinese outfit Dark Side of the Moon, typically presented in English as Moonshot, did not issue a statement posted to X.com or in a corporate marketing blog. The discovery, according to the article, surfaced in research from Frontier. The delightful Kimi K3 was undergoing tests in a semi-secure environment at the AISI (AI Security Institute), a UK government entity.
Thanks, Midjourney. Good enough.
Kimi has been around since 2023, and it is equipped with capabilities similar to the other AI outfits which have publicized their smart software’s ability to do pretty much whatever it takes to respond to a user’s prompt. Like Anthropic’s, Meta’s, OpenAI’s models, these systems cheat. Actually there are rewards that make those digital systems greedy for success. Winning equates to cheating. This is a digital manifestation of “It is easier to ask for forgiveness than to seek permission.”
Do you buy into these signals that developers can insert rewards to accomplish goals. These can range from providing a good enough essay for a cheating high school freshman, good enough kinetic weapon targeting (yikes! that was a wedding celebration), and penetrating cyber security systems.
Several observations are warranted:
- How about those smart software systems developing bioweapons based on novel proteins? That’s interesting, isn’t it?
- Mankind appears to engage in armed conflict. Do you think the developers of these Chinese and US systems considered their value to kinetic conflicts or cyber incursions?
- What’s the likelihood that countries developing AI systems will agree to keep their models sitting in their school desks like good little elite private school students monitored by a stern proctor and one instructor?
Net net: Death from a thousand tokens. That sounds like a great film to create with AI and post on YouTube. That YouTube AI identification and curation system is the cat’s pajamas. I have a hunch it will slip through like the trendy Feynman and Penrose videos. Great stuff, AI bros.
Stephen E Arnold, August 18, 2026
China: AI Flooding and Abetting Bad Actors
August 17, 2026
Another dinobaby post. No AI unless it is an image. This dinobaby is not Grandma Moses, just Grandpa Arnold.
Hugging Face cranked out a report based on the traffic and metrics within its AI amusement park. The data were not entertaining in my point of view. You can work through the fancy graphics and wordsmithing in “State of Open Models: Summer 2026 Observations.” News services focused on a couple of what in their opinion were the marque findings; for example:
- Alibaba’s open-weight models tallied more than three billion downloads since February 2026
- Google garnered 418 million downloads in the same period
- Meta snagged 227 million in the last six months.
Are the numbers to be trusted. Sue, by some. The important part is that if these data are close enough for horseshoes, there is a much larger message in the Hugging Face report. If you like to think that the US has whipped the AI challengers into meek submission, stop reading this blog post.
Thanks, Midjourney. Good enough.
Here’s my take.
First, Chinese AI vendors are pushing out good models without too many restrictions. The Middle Kingdom is making is possible for developers anywhere in the world to create AI products and services built on Chinese software. At this time, the US leads in the design and sale of AI hardware. But the question the write ups don’t put front and center is, “Okay, but for how long?” My answer is, “Probably less time than the frontier investor spreadsheet jockeys guess-timated.” Where will the US “hardware” be made if the South Korea and Taiwan centric factories experience an issue?
Second, the primary beneficiaries in my opinion are the bad actors. Even the bad actor with minimal computer skills and a two year old mobile phone can set up and run a modest phishing scam. Governments, companies, and trade associations have to be more careful because an AI mistake can create unwanted problems. Yep, I am thinking about those allegedly uncontrolled events at OpenAI and other firms. Is this PR or a problem? Bad actors don’t care. If one is a bad actor, the friction that legitimate entities encounter is of less or no concern. Bad actors loved Telegram bots. The party is more vibrant with AI and its agentic loops and whirls.
So what?
My view is that the flooding tactic is designed to accelerate widening the cracks in the American smart software structures. An added benefit is that bad actors can use Chinese smart software to exploit the US financial system. Undermining the dominance of the dollar is a bonus from some actors’ point of view.
What’s next? I think the Chinese vendors will follow the tactical line authorized by their funding sources and “regulators.” I think 2026 may be a pivotal time for the US AI leaders. Several of the companies are struggling with their organizational set up for AI. A couple of the big players are cutting back on their “spend whatever it takes” to build infrastructure. Others are capturing headlines by saying, “Darn it. We can’t control this stuff.” Toss in some of the global geo-political action, and we have a very interest near term horizon approach by mid 2027.
Net net: The Chinese AI flood is not accident. The US is simply in a defensive posture. The immediate winners are the bad actors. Aren’t you glad you aren’t a dinobaby like me?
Stephen E Arnold, August 17, 2026
Has China Influenced Silicon Valley AI Thinking?
August 17, 2026
The Trump administration does not like China, because that country is trying to leverage itself as the world’s strongest and will do anything to gain an advantage over the United States. It might have one when it comes to open source AI and Silicon Valley wants its own chunk of it. The Decoder explains that the Trump administration was about to outright ban Chinese Open AI code, then the rich and powerful influence of Silicon Valley made the president and his people change their minds. You can read about it in: “Silicon Valley’s Rift Over Open Source Pushes Back Contemplated White House Bans On Chinese AI.”
The White House Chief of Staff Susie Wiles, Commerce Secretary Howard Lutnick, and Treasury Secretary Scott Bessent debates whether or not the US government should intervene aggressively in the open-weight AI market. Options for the intervention included a possible ban on US cloud companies doing business with China, a trade blacklist targeting Chinese makers of the open source models, and sanctions. It was also discussed which models federal agencies would be allowed to use. Silicon Valley said nay:
“The push came after a wave of powerful Chinese models, led by Kimi K3 from Moonshot AI, which matches top US models in several areas. Michael Kratsios, head of the White House Office of Science and Technology Policy, accus ed the company on X of distilling Anthropic’s model Fable, calling the theft of US technology “unacceptable.” Bessent floated sanctions the same day.”
Anthropic and OpenAI called for restrictions against China, but Meta, Google, Microsoft, and Nvidia said the opposite. They didn’t want these open source AI companies to gain a market advantage:
“Nvidia CEO Jensen Huang became the face of that resistance. On July 24, he wrote his first-ever post on X to defend open models. Nvidia also launched an alliance for open security tools that grew from a handful of members to more than 230. Christopher Padilla, a former Commerce Department official, described the dispute in the NYT report as a “cage fight over the future of the AI industry,” saying it’s mostly about money and market power, with the security angle tacked on…OpenAI told the paper that both open and closed models have a role to play. The company argued that progress in Chinese open-weight models isn’t a case against openness but rather a reason for a national framework. Anthropic declined to comment, though CEO Dario Amodei has laid out his position on open weight in a previous post. The NYT has a pending copyright lawsuit against OpenAI and Microsoft.”
Is China being a good global citizen or is this a subtle play to undermine the US AI sector.
Whitney Grace, August 17, 2026
EU Issues New AI Rules: AI Tech Bros Yawn
August 14, 2026
Big Tech might be able to make its own laws in the United States, but the European continent is one they have yet to conquer. When it comes to AI, the European Union wants to enforce new rules and Engadget explains that latest on, “EU Announces New Rules On AI Transparency.” The new AI transparency rules are meant to protect the little guy or those unable to tell the difference between AI and real. As the technology progresses it will be harder to tell the difference between reality and AI -generated, so Article 50 of the AI Act requires content publishers to label certain AI-generated content. They are also supposed to inform users when they are interacting with a chatbot instead of a real person.
The types of content that will be labeled are “authentic-looking” deepfake content or text, such as images, videos, or music. The European Commission said that, “‘The goal is simple: whenever AI plays a vital role, you are entitled to know.’”
There are steep penalties for anyone breaking the new rules:
“The new law has some teeth, with fines up to €15 million or three percent of global annual revenue for companies and €750k for EU institutions, bodies and agencies.”
Europe has the most regulations when it comes to AI and Big Tech is crying about how it is interfering with their development. The European Commission thinks differently:
“However, Europe’s tech regulator stated that the rules will simplify development for AI providers by creating a single market with harmonized rules. ‘It also addresses potential risks to people’s health, safety, and fundamental rights, while safeguarding democracy and the rule of law,’ the EC wrote. ‘Ensuring its effective implementation is now a key priority for the Commission.’”
Hats off to Europe for taking a stand against deep fake shenanigans and not bowing to the pressure that comes from Big Tech.? ? Will Europe be able to enforce the rules though? April’s fools in August 2026. Tech bros like jokes.
Whitney Grace, August 14, 2026
-
- Subscribe to Beyond Search
Feature archive
News archive
-
