TL;DR

Nvidia resumes China AI chip exports; OpenAI launches GPT-5 amid user backlash; Instacart profit doubles.

Highlights

• U.S. grants Nvidia licenses to resume H20 AI chip exports to China; China accounted for 12.5% of Nvidia’s Q1 revenue 1.
• Chinese state media questions security of Nvidia’s H20 chips, raising concerns about hardware “backdoors” 5.
• China urges U.S. to ease export controls on high-bandwidth memory chips in ongoing trade talks 3.
• Trump-era semiconductor tariffs seen as ineffective for reviving U.S. chip manufacturing; supply chain reliance persists 13.
• China tightens rare earth export controls in response to U.S. tariffs; Germany and U.S. firms cite supply risks 8.
• OpenAI rolls out GPT-5 to 700M ChatGPT users, then restores GPT-4o and raises usage caps after user backlash 24.
• xAI’s Grok 4 outperforms GPT-5 on key benchmarks; Grok 4 now free with usage limits 2.
• AI labs (Anthropic, OpenAI) recruit entry-level quants from Wall Street with $300K+ offers amid 75% YoY surge in global AI investment 6.
• Nvidia shares up 36% YTD; hedge funds raise capital to target AI sector 7.
• Instacart shares jump 11% after Q2 profit doubles and guidance beats forecasts; CEO transition underway 9.
• Ethereum market cap tops $515B, surpassing Mastercard ; CryptoPunks NFT floor price rises to 55 ETH (~$235K) 1115.
• Tesla applies for UK electricity supply license, aiming to bundle energy retail with Powerwall and EV products 10.

Commentary

AI and semiconductor policy remain central to global tech investment dynamics. The U.S. move to allow Nvidia ’s H20 chip exports to China offers some revenue relief for Nvidia and its ecosystem 1, but Chinese state media’s public questioning of chip security signals ongoing political and regulatory headwinds for U.S. hardware suppliers 5. Simultaneously, China’s push for relief on high-bandwidth memory chip controls in trade negotiations points to persistent friction over access to critical AI hardware 3, while rare earth export restrictions further complicate supply chains for advanced manufacturing and energy storage 8. These developments heighten uncertainty for early- and growth-stage startups dependent on cross-border hardware flows, and may slow or complicate deal execution for VC-backed deep tech companies.

The AI platform race is accelerating. OpenAI’s GPT-5 launch to a massive user base was quickly followed by a partial rollback after user backlash, highlighting the operational risks of rapid product iteration at scale 24. Meanwhile, xAI’s Grok 4 outperformed GPT-5 on public benchmarks and moved to a free model, intensifying competition and shifting user expectations 2. For VCs, this environment favors startups with differentiated technical talent, robust user engagement, and the ability to adapt to fast-changing market dynamics. The ongoing bidding war for quant talent—fueled by record capital inflows into AI—will likely drive up early-stage costs and may compress returns unless portfolio companies can demonstrate clear defensibility and capital efficiency 6.

Macroeconomic and regulatory pressures continue to shape the investment landscape. The limited impact of U.S. semiconductor tariffs and China’s tightening of rare earth exports reinforce the need for supply chain resilience and alternative sourcing strategies 138. The African Development Bank’s mineral-backed currency initiative is an early signal of new frameworks for resource-based investment, which could affect capital allocation in energy, EV, and advanced manufacturing sectors 8.

On the consumer and digital asset fronts, Instacart’s strong results and positive guidance suggest renewed investor appetite for profitable, growth-stage platforms, especially those serving essential services and smaller enterprise customers 9. In crypto, Ethereum ’s rally and the resurgence of NFT pricing (notably CryptoPunks) indicate a return of institutional and collector demand, which may re-energize deal flow in Web3 infrastructure and digital collectibles 1115.