Hello and welcome to Regulator, a newsletter for Verge subscribers about the love-hate (but mostly hate) relationship between Silicon Valley and Washington. I hope everyone got to celebrate George Washington’s birthday in their preferred manner: skiing, staycationing, subscribing to The Verge if you haven’t already, etc.
Technology
It’s MAGA v Broligarch in the battle over prediction markets
Prediction: this is going to be a mess
Political alliances are rarely permanent, so it’s somewhat predictable that the MAGA-tech bro alliance seems to have fallen apart in the span of a single year. Which side the administration would actually choose, though, was more difficult to foresee.
Last winter, it appeared that two groups were in a tenuous relationship, held together by Elon Musk’s shameless execution of the DOGE agenda and Big Tech signing massive checks to settle Donald Trump’s lawsuits against them. But last night, the Trump administration made a choice: the money. The Commodity Futures Trading Commission (CFTC) announced that they would sue any state who tried to regulate prediction markets like Kalshi — even the Republican states.
On Tuesday, the CFTC filed an amicus brief to the Ninth Circuit Court of Appeals, officially opposing an onslaught of lawsuits filed by the states against betting markets like Kalshi, Polymarket, Coinbase, and Crypto.com. (The latter two, known primarily as cryptocurrency exchanges, have partnered with Kalshi and created a standalone prediction market called OG, respectively.) But unusually, the brief was accompanied by a threat — posted on X, of all places. In a video directly facing the camera posted on Tuesday night, sole CFTC chairman Michael Selig asserted his commission’s authority to regulate prediction markets and stated that the federal government was prepared to sue: “To those who seek to challenge our authority in this space, let me be clear: we will see you in court.”
Had Selig simply written a staid Wall Street Journal op-ed asserting the CFTC’s authority (which he also did), that would have barely raised an eyebrow. But in 2026, a video threat, especially one posted on X, is basically grounds to instigate a political firestorm — one that Spencer Cox, the Republican Governor of Utah, gladly kindled. “Mike, I appreciate you attempting this with a straight face, but I don’t remember the CFTC having authority over the ‘derivative market’ of LeBron James rebounds,” he posted in response (also on X). “These prediction markets you are breathlessly defending are gambling—pure and simple. They are destroying the lives of families and countless Americans, especially young men. They have no place in Utah.” He promised that Utah would continue to pursue litigation and beat the federal government in court if need be.
This wouldn’t be the first time that Utah and Cox have voiced their opposition to federal overreach regarding emerging technology. Last year, they publicly opposed an executive order that would have given the Justice Department the power to sue states passing and enforcing AI regulatory laws. The prediction markets issue hits a particular nerve in Utah: nearly half of the state is Mormon, and the Church of Jesus Christ of Latter-day Saints officially opposes all government-sanctioned forms of gambling, even state lotteries. But Cox’s declaration is what’s known in political circles as a “weathervane”: if one deeply Republican state is pushing back against the Trump administration on a new front, who else on the right might follow suit — and what sorts of new broligarch technologies would they fight against?
Is it a coincidence that Anthropic CEO Dario Amodei’s big visit to Washington happened just as the Pentagon was reconsidering its relationship with the AI company? Over the past two weeks, Amodei published a 38-page letter to Congress warning of the rising existential risks of artificial intelligence, conducted an interview with Axios’s Mike Allen (and sponsored their newsletter), and met with Sens. Elizabeth Warren (D-MA) and Jim Banks (R-IN) on Capitol Hill to support their bill banning the sale of advanced AI chips to China.
But Amodei barely finished his capitol blitz when Axios broke the news over the weekend that the Pentagon wasn’t just impatient with Anthropic’s reticence to use Claude for unrestricted purposes, but that it would actively punish Anthropic for refusing to cooperate by designating them a “supply-chain risk.” If it goes through, any company that wants to work with the military would have to cut ties with Anthropic. As one Pentagon official described it, “It will be an enormous pain in the ass to disentangle, and we are going to make sure they pay a price for forcing our hand like this.”
The Pentagon’s move makes no sense for anyone who sees Claude as a superior AI enterprise product to its competitors at the Pentagon (Gemini, ChatGPT, and Grok). If viewed through the lens of every former interaction that Trump’s had with companies that voiced ideological opposition to his agenda however, their treatment of Anthropic is par for the course. Years ago, for instance, Trump threatened to cut off Amazon’s access to their sweetheart deal with the US Postal Service, in retaliation for Jeff Bezos’ ownership of the then highly critical Washington Post.
But for me, the question is: exactly what caused the ideological break, and how much of it was even about national security? In the past few months, there’s been a bizarre spurt of online messaging from right-wing influencers trying to claim that Anthropic, of all the AI companies, was too woke — the kind of woke that could convince kids to become trans, or DEI-pill them, or whatever lib-coded nightmares a MAGA personality could dream up. There wasn’t much proof that they could point to, other than its employees expressing opinions that could be lib-coded, if you’re not fully reading the entire tweet:
Screenshot va @KatieMiller/X.
Speaking of influencers eating their own:
- Steve Bannon is under MAGA siege for his 2018 texts with Jeffrey Epstein, newly unearthed from the Justice Department’s Epstein Files, wherein he suggested that Trump should be removed from office using the 25th Amendment. Influencers calling for him to be questioned include Rep. Marjorie Taylor Greene, who broke from Trump and the GOP for trying to bury the Epstein Files, and retired Gen. Mike Flynn. Notably, both of them rose to prominence in 2020 by backing QAnon, the online conspiracy theory that claimed that an elite ring of Satan-worshipping pedophiles were in control of the government. (It may not help Bannon that he called Epstein “God” in one of the texts).
- Mike Davis, an anti-Big Tech lawyer who previously represented Trump in his lawsuits against Meta, took credit for the ouster of former friend and ally Gail Slater from the Department of Justice’s antitrust division, according to texts obtained by The Free Press. Though the two were once allies due to their shared interest in holding Big Tech accountable, their relationship started fracturing over disagreements about when to enforce antitrust laws and when to go for settlements.
- And we’re back to Bannon: per The Bulwark, he and fellow MAGA political operative Boris Epshteyn are being sued for their own shady cryptocurrency operation.
The White House is convening a third meeting between the crypto industry and the banking industry this week, continuing to hash out which major financial entity gets to reap the interests from yield-bearing stablecoin accounts (or if they get to bear interest at all). They have until March 1st to deliver draft language for the Senate. Good luck, y’all!
And finally, looksmaxxing Recess.
Can we all agree that HHS Secretary Robert F. Kennedy is framemogging Kid Rock in this video?
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Valve has some good news and bad news about Steam Controllers. The good news: if you make a reservation for a Steam Controller, the company will now show you one of three estimates of when you’ll be able to actually order your gamepad: by September 2026, by December 2026, or sometime in 2027. The bad news: any reservations made today “indicate a 2027 date for shipping,” Valve says.
“We have no plans to stop making Steam Controller,” according to Valve. “But as we look at the current demand compared to how many we know we can make by the end of the year, we want to manage expectations as much as we can with regards to when folks can expect to receive their order.”
Valve’s very good new Steam Controller went on sale in early May, and the initial rush led some people to run into frustrating problems with trying to check out ahead of the controllers eventually going out of stock. A few days later, the company announced that it would be implementing a reservations queue for interested buyers so they could get on a waitlist. If you’re on the waitlist, when you get notified that a Steam Controller is ready for you to buy, you have 72 hours to actually make the order.
“When we launched Steam Controller last month, we quickly saw that initial demand exceeded our expectations,” Valve says. “Switching to a reservation queue has (hopefully) cut down on the headaches on the customer side, and for us it’s also been helpful as we plan ahead and try to get as many out as quickly as we are able.”
All three of Valve’s big hardware products were delayed from a planned early 2026 launch because of the component crisis, Valve still hasn’t announced when the Steam Machine PC or Steam Frame VR headset might go on sale. However, just yesterday, Valve officially launched its big SteamOS 3.8 update with support for the Steam Machine. It’s also been importing a lot of hardware into the US as of late.
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The next time you pull up to a McDonald’s drive-thru, the voice taking your order may not be human. McDonald’s is testing a new AI-powered system called ArchIQ at five U.S. locations. The company has not said where those restaurants are located. The voice assistant, nicknamed Archy, can take drive-thru orders and has shown it can handle both English and Spanish.
For anyone who has repeated “no pickles” into a speaker box more than once, this could sound helpful. However, if you remember McDonald’s last AI drive-thru experiment, you may also wonder whether your burger order could somehow turn into a bag full of surprise McNuggets.
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WOULD YOU EAT AT A RESTAURANT RUN BY AI?
McDonald’s is testing an AI drive-thru system called ArchIQ at five U.S. restaurants. (Kurt “CyberGuy” Knutsson)
What is McDonald’s AI drive-thru?
ArchIQ is McDonald’s new AI system for restaurants. It can take drive-thru orders and also help with operations behind the scenes.
In a post on X, McFranchisee, an anonymous McDonald’s franchisee account, said the system is currently in five test stores and has processed more than one million transactions. The account also said about 90% of orders were completed without a human stepping in. That number sounds promising. Still, McDonald’s has not confirmed a nationwide launch date. For now, this remains a limited test.
The system also appears to connect with a bigger McDonald’s plan called “McDonald’s > NEXT.” CEO Chris Kempczinski described the strategy as a way to bring in more customers and improve restaurant productivity. The plan also includes menu changes, restaurant redesigns, technology upgrades and more focus on hospitality.
Why McDonald’s is testing AI ordering
Drive-thrus can get chaotic fast. Someone changes an order after the total appears. A child calls out from the back seat. Road noise makes the speaker hard to hear. Then the driver remembers the extra sauce after everything has already gone through. That is the type of pressure McDonald’s wants AI to handle.
If ArchIQ works well, it could help restaurants move cars through the line faster. It may also reduce mistakes during busy hours. Workers could then focus more on preparing food, handling payments and helping customers who need a real person.
ArchIQ also appears to have a management role. In the same X post, McFranchisee described Archy as a tool that could alert managers to bottlenecks or other issues before they slow down operations.
STARBUCKS USES CHATGPT TO SUGGEST DRINKS BASED ON MOOD AS EXPERT WARNS OF HIDDEN DOWNSIDES
The AI assistant, nicknamed Archy, can take drive-thru orders and may also help managers spot restaurant slowdowns. (McFranchisee)
McDonald’s tried AI drive-thru ordering before
This new test follows McDonald’s earlier AI drive-thru experiment with IBM. That program involved more than 100 restaurants. McDonald’s ended the test in 2024 after customers complained about order accuracy. Some mistakes also went viral, creating an embarrassing moment for McDonald’s and raising questions about whether the technology was ready for the drive-thru. Customers reported wrong items, strange quantities and other order mix-ups. That history is why this new test will get extra attention.
This time, McDonald’s is working with Google technology. McFranchisee also claimed every McDonald’s in the U.S. is getting Google Edge Cloud hardware in anticipation of the rollout. McDonald’s seems to believe the newer system can perform better than the last one. The real test will come when regular customers use it during real drive-thru rushes.
How McDonald’s AI drive-thru could help customers
If McDonald’s gets this right, the most obvious benefit is speed. An AI ordering system does not get tired during a long shift. It may also help more customers order in the language they prefer. That could make a busy drive-thru feel less frustrating, especially during breakfast or late-night hours.
The system may also ask clearer follow-up questions and catch missing details before the order reaches the kitchen. That would be a win for customers who want to get in, get their food and get on with the day.
The biggest problem with AI drive-thru orders
The biggest concern is accuracy. AI can still misunderstand people. That gets frustrating fast when you are trying to grab lunch between errands or get your kids fed from the back seat. A wrong order wastes time. It also puts workers in the position of fixing a mistake the machine made.
There is also the customer service side. Some people like hearing a real person at the speaker. Others may find an AI voice cold or annoying, especially if the system gets confused.
Then there is the privacy question. If an AI system takes your order, customers may wonder what gets collected, how long it is kept and who can access it. McDonald’s has not publicly explained those specifics for this current ArchIQ test.
ALEXA+ LETS YOU ORDER FOOD LIKE A REAL CONVERSATION
A drive-thru menu board stands outside a McDonald’s restaurant in Hercules, Calif., on Oct. 23, 2024, amid an E. coli outbreak linked to onions in Quarter Pounder sandwiches that has sickened dozens and killed one person across the U.S. (David Paul Morris/Bloomberg via Getty Images)
How to avoid AI drive-thru mistakes
Before you leave the drive-thru, take a moment to check the order screen. Make sure the items match what you said. Listen when the system repeats your order. Keep your receipt until you confirm the food is right.
Also, avoid sharing extra personal details at the speaker box. Your order should only require your food choices and payment.
If the AI gets confused, ask for a crew member. You do not need to keep going back and forth with a machine over fries.
What this means for you
For now, you probably will not notice a change at your local McDonald’s. The ArchIQ test appears limited to five U.S. restaurants, and the company has not said when it could expand.
Still, this gives customers a preview of where fast food may be heading. AI could soon play a bigger role in how restaurants take orders and manage the kitchen. That may speed up the line, though it could also make the experience feel less personal.
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Kurt’s key takeaways
McDonald’s clearly wants AI to play a bigger role in its restaurants. From a business point of view, the idea makes sense. Shorter drive-thru lines could help franchisees and customers. Better restaurant data could also help managers fix problems faster. But I still want the human backup. Food orders can be messy because people are messy. We change our minds. We talk over each other. We forget the extra ketchup until the last second. AI may handle much of that one day. For now, I would treat it like any busy drive-thru interaction. Speak clearly. Check the order. Do not pull away until you know your food is right.
Would you trust an AI voice to take your McDonald’s order, or do you still want a real person on the other end of the speaker? Let us know by writing to us at Cyberguy.com
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Midjourney CEO David Holz just showed off the company’s first hardware product and plans to build a San Francisco spa, which he admitted is a bit different from the “cat pictures” produced by its AI image generator. Dubbed The Midjourney Scanner, it’s an ultrasound-based full-body scanner that uses a ring of sensors to capture vertical slices of the inside of your body, looking at the composition of your muscle, fat, bone, and organs to start. Holz said ideally, you could do this once a year or every single day, as it “aims for image quality comparable to MRI in many ways.”
He mentioned that one way he’d like to use it would be to see how his body changes in response to diet and workout changes, saying, “I’m not the most measured man on Earth yet, you know, but maybe I want to have that daily [measurable information].” A set of job listings advertises the company’s goal as trying to “build and launch the world’s first full-body ultrasound CT scanner, ultimately bringing safe, fast, and high fidelity preventative scanning to billions via a magical spa experience.”
The Midjourney Scanner was developed in a partnership with ultrasound tech company Butterfly Network, which said it uses “40 Butterfly Ultrasound-on-Chip imaging modules per system.”
The scanning process starts with stepping onto a platform that drops down into the water on rails through a ring of thousands of transducers that create ultrasonic waves. It then records the ripples passing through your body to analyze them and create detailed 3D images. The scan takes about 60 seconds. Holz said about a dozen people have been scanned so far.
It starts by stepping into a shallow pool of golden light. You then begin to descend into the water. Your body passes through a ring of underwater sensors, each acting like a dolphin, using its echolocation. The sensors send ultrasonic sound waves through your body from every angle. With enough waves, and enough angles, we form an image of what’s happening inside your body.
It combines those sensors with two petaflops of processing power. But after watching the livestreamed reveal, I’m still unclear on what Midjourney’s AI image generation tech exactly has to do with the Midjourney Medical effort, beyond an alternative business for otherwise-unused AI compute.
Holz hopes to put 10 of the scanners into a Midjourney Spa location in San Francisco’s Union Square that will open before the end of 2027 and offered to scan the hands of attendees at its launch event. The Midjourney Spa will have a gym, saunas, and cold plunges to go along with the hot tub–equipped scanning rooms where visitors will get into the water to be scanned.
He did mention that various medical applications would require FDA clearances, but for now, Midjourney Medical says it’s working on “body composition maps” that don’t require the same level of clearance as diagnostic imaging. It also says the “library of scans” users create can be shared with doctors, AI health tools, or others, and that, “We take data privacy seriously — more details on our data policies will come as we get closer to launch.”
Holz suggested that eventually these scans could become better than an MRI, without radiation, powerful magnets, or other complicating factors, to get a look at what’s going on inside people’s bodies “real fast.” In response to a question, he imagined a future where the FDA had a class of devices to look at “weird” things and allowed people to “just try to get as much data as we can.”
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