Precarious Times

This has gotten lots of attention in tech circles, but not that many people have been connecting the dots. From the Information: Coinbase has cut its AI spending “nearly in half” even as it increases the number of tokens it uses, by using various measures to control costs. These measures include defaulting to open-weight models from Chinese firms, Coinbase CEO Brian Armstrong said in an X post on Friday night.Armstrong’s post highlights both the growing usage among U.S. firms of open-weight models coming out of China to control AI spending even as the cost of cutting edge U.S. services rises. Armstrong said Coinbase had experimented with GLM 5.2, a just-released model from Z.ai, and Kimi 2.7, from Beijing-based Moonshot.Pretty much everybody reading this has a good idea how massive the AI boom is, with current and proposed capital expenditures in real terms exceeding those of the railroad bubble, the dot-com bubble, and the early-2000s real estate bubble combined. And anyone who…