Hello and welcome to Regulator, a newsletter for Verge subscribers about the politics of technology and the technology of politics — now landing in your inbox on Wednesdays! If someone has forwarded this email to you, and you’re not a Verge subscriber yet, you should sign up right here, and not just because it would be really, really cool if you do that. We can apparently see how many non-subscribers have opened this email, and why should Palantir get all the “spying on people” fun?

Do you have cool events to highlight, tips to toss over, and secrets to spill? Send everything to tina.nguyen+tips@theverge.com. Or, if you’re truly tech-pilled, send me a message on LinkedIn.

Surprisingly, artificial intelligence does not take the highest political priority during a war — much less an ill-conceived war with Iran that’s paralyzed the energy markets, destabilized America’s relationships with the Middle East and Europe, and alienated members of President Donald Trump’s diehard MAGA coalition. (Just yesterday, Joe Kent, election denier and onetime Trump-endorsed congressional candidate, announced that he was stepping down as the director of the National Counterterrorism Center in protest of the Iran war.) But the effect it’ll have on the tech and AI industry — and industry in general — is so dire that David Sacks, billionaire and the AI and crypto czar shaping the Trump administration’s tech policies, did something politically risky: He publicly suggested that Donald Trump find some way to get out of the Iran war.

Last Friday on his podcast All In, Sacks and his crew laid out several alarmingly realistic scenarios based on recent developments: Iran indicated it was willing to attack oil and gas depots in neighboring countries, destroy desalination plants crucial for supplying water to over 100 million people (which Sacks described as a “humanitarian crisis” that would render the Middle East uninhabitable), and bombard Israel until it either relented or decided to use a nuclear weapon. The Democrats would probably win the midterms. But also, and arguably worse, World War III was possible. “This would be a really good time to take stock of where we are and try, I think, to seek an off-ramp,” he told his co-hosts. “And look, if escalation doesn’t lead anywhere good, then you have to think about, well, how do you de-escalate? And de-escalation, I think, involves reaching some sort of ceasefire agreement or some sort of negotiated settlement with Iran.”

Whatever advice Sacks may have tried to offer has fallen on deaf ears. On top of the US military’s continued assault on Iranian oil infrastructure, over the past few days, Trump said he was open to putting US troops on the ground in Iran, said that NATO countries hesitant to support him were making a “foolish” decision, and just because, added that he was thinking of invading Cuba next. Trump also told reporters this week that Sacks had not spoken to him about the war, either. Whether that’s true or not, Trump often defaults to this explanation when trying to diminish a critic. And the sources I speak to around the White House — especially the ones familiar with Trump’s MO — are pessimistic that Sacks will have any shot at getting the president to listen to him.

A David Sacks hater may note that the billionaire has hit the boundaries of his perceived influence on Trump. At the same time, every single one of Trump’s former allies — especially the ones who don’t work for him — have hit that limit, too. The MAGA anti-war isolationists have been completely betrayed. The titans of industry who care about the markets are at the mercy of Trump’s whims. Heck, Trump has turned around and embraced the neoconservatives who used to despise him, but are now the only people on the right clamoring for regime change in Iran. (If you want to get a sense of how his administration underlings are enabling Trump, I was literally at the Pentagon last week for a vibe check.)

Out of the Trump oligarch classes, the technologists may suffer the longest term effects. Unlike the MAGA base, who’d supported Trump for intangible ideological reasons, Big Tech’s got a deeply financial incentive to stay allied with the president. So much of their current advantages rely on their direct relationships and ability to assuage his ego, which has certainly paid dividends for them over the past year: antitrust investigations dropped, trade loopholes opened, executive orders signed, and so on. (What do you think the ballroom donations were for?) And it’s possible that they believed that the Iran situation would be similar to Venezuela, wherein they’d reap the benefits of seizing Iran’s oil supply, and decided not to intervene.

But there’s a critical characteristic they overlooked, one that dates back to Trump’s relationship with Roy Cohn in the ’70s: Trump does not like to be humiliated by his foes, and Trump is always inclined to strike back twice as hard in order to crush their spirits, with little care for consequences or long-term damage. It mostly manifests via legal challenges and lawsuits in America, but has occasionally gone in a violent direction (see: January 6th and the ICE protests in Minnesota). In this case, he is trying to one-up a violent religious theocracy, which declared a military jihad against the United States in the wake of Khamenei’s death, and also possesses missiles. The rich nerds who make the beep-boops have very little chance of changing Trump’s mind — especially so long as there’s a political contingent on the right egging him on — and even if Sacks believed he was talking to a friendly audience in an online safe space, there’s no guarantee that Trump will be happy that he voiced dissent at all.

Oh, right, crypto is still happening, too.

Unfortunately, I couldn’t catch a lot of the Blockchain Conference this year (see: Iran) but it seems like some major developments came out of it, including the CFTC and the SEC dropping a major guidance that most digital assets are not securities, clarifying the way that certain cryptocurrency is regulated and whose rules apply. But though it’s the most comprehensive document released around this crucial issue, they also warned that it still needs Congress to pass laws that would make those changes permanent, and the CFTC is pretty busy as is. In other words: The Clarity Act still needs to be passed, guys. And that seems to be going great. Right?

.. another blockchain-based bar! This time, Polymarket announced the surprise opening of The Situation Room, “the world’s first bar dedicated to monitoring the situation.” According to renderings posted on X, the bar, described as a “sports bar just for situation monitoring,” will have everything one needs to monitor the situation: live feeds on X, sports games, and Bloomberg terminals. (Polymarket did not immediately comment on where said bar would be located.)

I’ve been doing some spring cleaning at home and recently found a quart-sized Ziploc bag that’s got a handful of spare change that I’ve been meaning to drop off at a Coinstar for over a year. But I’m lazy, and if there’s anything I’ve learned from TMZ, it’s that paying money for stories works (sometimes). So I will give this bag of loose change to anyone who can send authentic, verified, non-AI generated footage of this reported fight between Sam Altman and playwright Jeremy O. Harris at the exclusive, off-the-record Vanity Fair Oscar Party, allegedly over OpenAI’s contract with the Pentagon. (I presume the audience of Regulator is composed of Hollywood A-listers.)

And, no, I’m not going to send you the cash equivalent of the bag’s value. The condition for the payout is that you have to take this bag off of my hands, including all of the Costa Rican currency. AND I’m keeping all the quarters. And in the extraordinarily unlikely event that someone follows through on this offer, I have to get permission from Nilay Patel to break the ethics policy this one time, because this is technically a quid pro quo, albeit an extremely awful quid pro quo for whomever sends it.

It is day 13 of America’s surprise war with Iran — by sheer coincidence, it’s Friday the 13th — and I am delirious. I haven’t had a coffee since I woke up at 5AM, because I’m not allowed to bring outside beverages into the Pentagon (the security screening cutoff was at 7AM for the 8AM), and ever since Defense Secretary Pete Hegseth changed the rules last year, journalists are not allowed to go anywhere in the building without an escort, especially to wherever coffee is available. Also, I am struggling to comprehend why I, a reporter who has never covered a war, was assigned to sit in one of the good seats in the briefing room, watching Hegseth take the podium and immediately start berating the veteran journalists assigned to the bad seats.

“We will keep pushing. Keep advancing. No quarter, no mercy for our enemies. Yet some of this crew in the press just can’t stop,” Hegseth glowers, speaking in perfect cable-news cadence. He was speaking to the pissed-off defense reporters from NBC, ABC, The Wall Street Journal, The New York Times, and Fox News — the people who’d covered conflicts in the Middle East for decades, knew the intricacies of the Pentagon, and knew what needed to be asked for the sake of accountability. It was the first time many of them had been back since last October, when the entire Pentagon press corps resigned in protest after Hegseth told them that they could not report on any information, classified or otherwise, that he did not approve for release.

In the front row and middle aisles, right at Hegseth’s eyeline, were their replacements from what Hegseth called the “patriotic press” — One America News, ZeroHedge, The Gateway Pundit, Real America’s Voice, The Daily Wire, and Lindell TV — many of whom looked startlingly young. It’s not a good look to have a half-full briefing room of starstruck reporters during a controversial war, so this week, the Pentagon press team announced that they would hold an open press conference, allowing the old defense reporters back in for the first time in months. But as long as they asked too many questions, Hegseth would continue to disrespect them.

“Allow me to make a few suggestions,” Hegseth told the media. “People look up at the TV and they see banners. They see headlines. I used to be in that business. And I know that everything is written intentionally.
 For example, a banner or headline [like] ‘Mideast war intensified,’ splashing on the screen the last couple of days, alongside visuals of civilian or energy targets that Iran has hit, because that’s what they do. What should the banner read instead? How about ‘Iran increasingly desperate’?”

Were they, though? Since his last press conference on Tuesday, two US planes crashed into each other last night (which Hegseth did not mention during his tirade). The Iranians had fired missiles at Bahrain, sent attack drones into Lebanon, and threatened to target American cities next. Now the misadventure was hitting American wallets and making Americans angry. Iran had begun placing mines and assaulting ships passing through the Strait of Hormuz — a crucial energy shipping lane they were literally right next to — and sent the price of oil skyrocketing. Even with price controls, oil was roughly $100 a barrel that morning, up 40 percent since the war started two weeks ago.

“More fake news from CNN: reports that the Trump administration underestimated the Iran War’s impact on the Strait of Hormuz,” Hegseth continued. “Patently ridiculous, of course. For decades, Iran has threatened shipping in the strait before. This is always what they do. Hold the strait hostage. CNN doesn’t think we thought of that. It’s a fundamentally unserious report. The sooner David Ellison takes over that network…” He trailed off. A murmur rippled through the room. Everyone knew what had happened to CBS News after Ellison bought it.

As Hegseth swung back and forth between abusing the press and glazing the military, followed by Chairman of the Joint Chiefs of Staff Dan Caine giving actual relevant information about the war, my personal curiosity turned to why I had been invited to this briefing. Yes, invited. The Pentagon press team knew that I wasn’t the nicest reporter to them and yet had offered me a seat. And what journalist wouldn’t attend a press conference at the Pentagon during a war? Every time I’d ever watched a press conference at the Pentagon — especially whenever the military was involved in active conflict — I’d see the room packed with as many reporters as they could possibly fit. But this time, they’d only accepted 60 reporters.

Despite my grogginess, I could tell that the first question, from a woman at One America News in the front row, who later bragged on Instagram that she’d gotten to ask the first question for the last three press briefings, was a softball. (“Can you tell us a little bit more about the Strait of Hormuz and when it might be fully operational again?”) And I could tell that the second question, from a woman at The Daily Wire — who also, apparently, frequently got the second question — was meant to give Hegseth an opportunity to attack the media. (“ABC News has updated its story from yesterday, clarifying that the FBI report on Iran possibly striking California was unverified. I just want to ask you, what impact did that original reporting have on the public?”)

Finally Hegseth pointed at someone that was not a young woman, opting for an older gentleman in a red tie sitting behind me. He announced himself as Michael Gordon of The Wall Street Journal, before asking, “Iran is thought to have 440 kilograms of highly enriched uranium in at least two locations and several thousand kilograms of lower purity material. Can you conclude this mission successfully without physically taking control of that material or are you counting on diplomatic negotiations to provide some measure of control leading to its removal? You’ve mentioned missiles, you’ve mentioned drones, [the] military, industry. You haven’t stipulated that taking care of that material is a mission priority.”

Judging from his face, Pete Hegseth and I appeared to have something in common: We had no idea that this was a serious issue. Thankfully, Hegseth was the one responsible for tap dancing around an answer (“We have a range of options, up to and including Iran deciding that they will give those up, which of course we would welcome”), and I looked up Gordon’s background in the meantime. Suffice to say, he’d been covering nuclear weapons and Middle Eastern wars since long before I was even born.

Once Hegseth managed to get out of that, however, he immediately regained his composure — as in, he began fighting with any mainstream outlet who asked him a tough question:

Q (NBC): Is Iran placing new mines?

Hegseth: We’ve heard them talk about it, just like you’ve reported recklessly and wildly about it—

Q: I haven’t reported on it, actually, but have they placed any mines?

Q (NYT): Mr. Secretary, you have said that the US military has essentially aerial superiority, naval superiority over Iran, yet we’re not escorting ships through the Strait of Hormuz. Why? How did you not plan for this?

Hegseth: We planned for it. We recognize it. Because ultimately, we want to do it sequentially in a way that makes the most sense for what we want to achieve and ensure that we’re sending the right signals to the world when we do so. … It’s like this whole idea of the war widening. That’s what the press wants to make it look like, like it’s widening and chaos is ensuing. No, we’re actually closing in on, grabbing hold of, and controlling what objectives we want to achieve and how we want to achieve them, shape — it’s called shaping operations and setting the conditions.

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By now, Hegseth’s petulance about the media is so well known that it’s a running Saturday Night Live bit. But this time, it wasn’t just the mainstream press assailing him with harsh questions. The Trump administration had fumbled into the kind of forever war that was broadly unpopular — particularly among the neocon-hating MAGA voters who’d never wanted to revisit the failures of Afghanistan and Iraq. But the friendlies in the front rows wouldn’t give him an opportunity to gloat. True, some of the outlets kept the questions elementary, though I couldn’t see whether it was a MAGA outlet or a foreign outlet. (Said one man: “Given everything the US has accomplished in the last 24 hours, as of today, how do you define success in this military option?”) But a reporter from the front row (I couldn’t tell whom) was ready to lob politically toxic questions that Hegseth had to dodge:

Q: Polls show over 80 percent of Republicans support the president’s military action in Iran, but there’s some consternation in parts of the party, particularly from your fellow Fox News alum Tucker Carlson. He called the war “disgusting and evil” and then said of unconditional surrender, which the president has called for, means “foreign troops get to rape your wives and daughters.” Have you heard these comments and what’s your reaction to them?

I instantly knew this was from a MAGA outlet, because if someone from the mainstream media world had asked about Carlson, a powerful commentator and loose cannon in Trumpworld, Hegseth would have immediately attacked them for trying to sow division. Instead, he demurred. “We’re busy executing on behalf of great patriotic Americans with a clear mission that’s 47 years overdue. And we’re going to execute on that regardless of what people say about it.”

The final question, from Lindell TV reporter Heather Mullins, flicked at two subjects of the right wing’s increasing skepticism: China, which was offering limited support to Iran, and Israel, which had arguably egged Trump into launching the attack on Tehran that killed the Ayatollah, and whose intelligence on the possibility of regime change was horribly, horribly wrong. “I know President Trump is calling for an unconditional surrender from Iran. Given that the US is working in partnership with Israel on this whole operation, is Iran expected to meet demands of both countries or just the US? And what are those demands?”

Hegesth gave an answer that would not appease the Israel skeptics: “Our objectives are our objectives. So when those are met, as we meet those, we’ll set the — we’ll set the tempo of when those are met.” The conference quickly wrapped and we were soon ushered out, all somewhat bewildered. If I had to describe the general reaction purely on vibes, I’d say everyone left feeling more frustrated than they had coming in — the “patriot” reporters who suspected that Hegseth was dodging and wondered why he hadn’t answered more questions, and the natsec reporters with decades of experience who knew what Hegseth was dodging.

I was frustrated, too, because I was one of the other people in the room who, by design, could not ask a good question about the war. I’ve never seen active combat or visited a war zone. I’ve never even traveled to the Middle East. Even if I’d spent significant time crafting a good question in advance, I wouldn’t have the knowledge base to ask any follow-up questions, much less verbally spar with Hegseth if and when he’d claim I was a liar. I have, however, covered Trumpworld and the MAGA media for over a decade, and a hard rule in both worlds is that the performance is always more important than the substance.

That’s pretty obvious to anyone watching from home. But what you don’t see, and what is a new phenomenon in this administration, is all the production behind the camera: the reality television instincts and psychological tactics meant to trigger genuine anger, conflict, and (most importantly) drama among the participants who are trying to take it seriously. It can be done by simply depriving them of caffeine, shuffling the seating arrangements, and filling a spot with someone inclined to write about the media drama — instead of someone capable of interrogating Pete Hegseth about the actual war.