🔥 Curtailing U.S. Investment in China

Good Morning. Yesterday marked a significant moment for tech stocks on Wall Street, highlighted by a juxtaposition of major events: the launch of a Reddit’s IPO and the initiation of an antitrust lawsuit against Apple, the world’s leading smartphone manufacturer.

Should be interesting to see how the market responds as we close out the week…

THE BOTTOM LINE UP FRONT

Congress Watching U.S. Money Going Into China

U.S. Congress is ramping up scrutiny on American investments in China due to concerns over funding the Chinese military, suggesting tighter regulations could become long-term. Despite previous setbacks, members of the House of Representatives continue to advocate for restricting investments in key Chinese sectors.

Call for Legislative Action

Mike Gallagher, chairman of the House Select Committee on Strategic Competition between the U.S. and the Chinese Communist Party, emphasizes the need for Congress to legislate a lasting solution to regulate U.S. investments in China.

Focus on Advanced Technology Investments

Gallagher advocates for a strict cutoff of U.S. funds to Chinese advanced technology sectors, arguing that continued financial support could lead to the U.S. inadvertently funding its strategic competition. His position reflects a growing consensus among lawmakers on the need to protect national security interests by reevaluating investment flows.

INTERNATIONAL SECURITY & DIPLOMACY

Counterterrorism

• A roadside bomb in northwestern Pakistan killed two soldiers and wounded 15 others near a security convoy. The incident occurred in Dera Ismail Khan, a region once controlled by the Pakistani Taliban, near the Afghanistan border.

• A rare suicide bombing outside the New Kabul Bank in Kandahar, Afghanistan, killed at least three and injured over a dozen. The attack occurred as people were gathering to receive their salaries.

• Yemen's Houthi rebels have guaranteed safe passage for Russian and Chinese ships through the Red Sea and Gulf of Aden. In exchange, Russia and China have pledged "political support" to the Houthis, potentially including blocking UN resolutions against them.

Military & Defense

• Ukrainian President Volodymyr Zelenskyy has called on EU leaders to fund arms for Ukraine with profits from frozen Russian assets, emphasizing the need for Russia to bear the war's costs. He made this appeal via video link during a two-day EU summit in Brussels.

• The Biden administration has approved a potential sale of Abrams tanks and equipment to Bahrain for up to $2.2 billion. This move, still pending, aims to bolster Bahrain's defense capabilities, according to the Defense Security Cooperation Agency.

• Israel has gathered extensive intelligence on Hamas's internal operations during its military offensive in Gaza, according to multiple official sources. This intelligence provides Israel with a detailed insight into the militant organization's workings.

Cybersecurity

• Ivanti has revealed a critical remote code execution flaw in Standalone Sentry, identified as CVE-2023-41724 with a 9.6 CVSS score, urging immediate patching. The vulnerability allows unauthenticated actors to execute commands on the system within the same network.

• The U.S. Treasury Department has sanctioned two Russian nationals and their companies for engaging in cyber influence operations aimed at foreign malign influence for the Russian government.

• A new malware campaign, Sign1, has compromised over 39,000 websites in six months, leading to unwanted redirects and popup ads for visitors.

Counterintelligence & Espionage

• The National Reconnaissance Office (NRO) plans to launch satellites enabling the tracking of moving vehicles and individuals from Space for the U.S. military and intelligence.

• Slovenia has ordered a Russian diplomat to leave the country within seven days after declaring them persona non grata for activities deemed incompatible with their diplomatic status. The Slovenian Foreign Ministry provided no further details on the expulsion.

• The US House of Representatives passed the Protecting Americans’ Data from Foreign Adversaries Act (HR 7520) in a bipartisan effort to limit the sharing of sensitive American data with foreign entities.

Transnational Organized Crime

• The Jalisco New Generation, a violent Mexican criminal group, operates call centers targeting retirees to ostensibly buy their vacation properties, only to then drain their bank accounts.

• The Venezuelan government claims President Nicolás Maduro and his inner circle have been the targets of several potentially harmful conspiracies since last year, leading to over 30 arrests since January.

• Italian authorities have arrested 31 individuals suspected of using drones to deliver contraband to mobsters in prison, catering to 15 organizations linked to the Camorra mafia.

• German authorities dismantled Nemesis Market, a significant online marketplace for drugs, cybercrime services, and fraudulent credit card data. The platform's server infrastructure in Germany and Lithuania was seized on Wednesday.

SCIENCE & TECHNOLOGY

Elon Musk's Neuralink has achieved a significant milestone by demonstrating its first patient, Noland Arbaugh, using a brain-implanted device to move a cursor and play chess online.

Neuralink's Breakthrough

Arbaugh, paralyzed from a diving accident, underwent a simple surgery in January to receive the chip that aims to bridge human brains with computers, targeting complex neurological issues.

Patient Experience and Future Possibilities

Arbaugh's experience highlights the potential life-changing impact of Neuralink's technology. He mentioned the ease of the surgical procedure and shared his excitement about regaining the ability to play Civilization VI for extended periods, thanks to the brain implant. This development opens new avenues for individuals with severe mobility challenges.

In other news…

🦅 The U.S. Army secures a $118 million contract with Raytheon for the advanced Common Sensor Payload version 3 (CSP v3) systems, enhancing the MQ-1C Gray Eagle drones with superior day and night high-definition imagery and targeting capabilities for laser-guided munitions.

🚀 Japan's Space agency and its prime contractor aim to carve out a profitable niche in the competitive launch market with their new H3 rocket, following its inaugural successful flight, challenging SpaceX's dominance.

⚠️ Over 30 nations committed to leveraging nuclear energy for a climate-neutral future and enhanced strategic security, marking a shift from the post-Fukushima skepticism towards nuclear power.

DEALS & FUNDING

OTB Ventures has announced the closure of a significant $185 million fund aimed at bolstering deep tech ventures in Europe, primarily focusing on Series A investments. The fund is structured to be versatile, dedicating a portion to seed funding and a majority to subsequent investment rounds.

Investment Focus

The fund's establishment marks OTB's largest to date, receiving substantial backing from the European Investment Fund (EIF) and the European Union's InvestEU Fund.

Strategic Backing

OTB co-founder Adam Niewiński expresses appreciation for the EIF's support and its progressive investment philosophy, indicating a strong alignment with OTB's strategic objectives in the deep tech sector.

In other news…

♻️ Greenly, a Paris-based startup, offers carbon accounting software that analyzes customer data—such as utility, freight, cloud usage, and financial records—to calculate carbon emissions across various categories.

🔍️ The Browser Company, creators of the Arc browser, secured a $50 million funding round led by Pace Capital, valuing the firm at $550 million.

🌱 Security data startup Tarsal raised $6 million in seed funding from Harpoon Ventures, Mango Capital, and others, including a Y Combinator investment.

🐻 Dymium, a Californian startup focusing on data protection technology, secured $7 million in early-stage funding, primarily from Two Bear Capital. Launching with two data protection products, Dymium aims to enhance data governance and privacy beyond conventional access controls.