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In less than three years, artificial intelligence (AI) algorithms developed under DARPA’s Air Combat Evolution (ACE) program have progressed from controlling simulated F-16s flying aerial dogfights on computer screens to controlling an actual F-16 in flight.

In early December 2022, ACE algorithm developers uploaded their AI software into a specially modified F-16 test aircraft known as the X-62A or VISTA (Variable In-flight Simulator Test Aircraft), at the Air Force Test Pilot School (TPS) at Edwards Air Force Base, California, and flew multiple flights over several days. The flights demonstrated that AI agents can control a full-scale fighter jet and provided invaluable live-flight data.

From ACE Program’s AI Agents Transition from Simulation to Live Flight:

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Allen & Overy is introducing an artificial intelligence chatbot to help its lawyers draft contracts, as the magic circle legal firm seeks to adopt the much-hyped technology to find efficiencies for its lawyers and clients.

The London-based group told the Financial Times it had rolled out a chatbot named Harvey after testing it since November for use in tasks such as drafting merger & acquisition documents or memos to clients.

From Allen & Overy introduces AI chatbot to lawyers in search of efficiencies | Financial Times:

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On February 3rd, the Australian Treasury published a long-awaited token mapping exercised designed to form the basis of future regulatory efforts on cryptoassets. The Australian government states that the exercise is designed to enable “a fact-based, consumer-conscious and innovation-friendly approach to policy development”.

The mapping creates two major categories of tokens: intermediated token systems, and public token systems. Intermediated token systems refer to categories of cryptoassets and related activities typically described as centralized finance (CeFi), and where many aspects of traditional financial services regulation can be applied.

For example, cryptoasset service providers – such as most exchanges – and certain innovations – like fiat-backed stablecoins and tokenized real-world assets – are likely to fall within the scope of existing financial services regulation aimed at protecting consumers and the redemption rights of holders because they generally mimic other types of financial activity that are already regulated.

Public token systems, however, are those typically found in the ecosystem of decentralized finance (DeFi), where traditional intermediaries may not be present and where activity is executed using public smart contracts.

While smart contract-based systems are designed to remove counterparty risks, other threats may be present, such as those related to bugs in their code or flaws in their economic mechanism that can allow them to be exploited to the detriment of other market participants. In the paper, the Treasury acknowledges that these DeFi innovations may pose challenges to pre-existing regulatory frameworks designed for intermediated environments and may require new approaches.

From Crypto Regulatory Affairs: Australia Releases Token Mapping Framework | Elliptic | Elliptic Connect:

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What these arguments miss, however, is that DeFi is rife with its own unique set of risks.

On Sunday, January 15, an unknown actor executed a flash-loan attack on the DeFi lending protocol Midas Capital. In a matter of seconds, $660,000 worth of cryptocurrency was gone. There have been four such exploits so far this year, according to data from DefiLlama, including a $120 million exploit of BonqDAO.

From Opinion: DeFi can’t match its promise until it confronts its problems – DL News:

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DeFi does not rely on intermediaries and centralized institutions. Instead, it is based on open protocols and decentralized applications (DApps). Agreements are enforced by code, transactions are executed in a secure and verifiable way, and legitimate state changes persist on a public blockchain. Thus, this architecture can create an immutable and highly interoperable financial system with unprecedented transparency, equal access rights, and little need for custodians, central clearing houses, or escrow services, as most of these roles can be assumed by “smart contracts.”

From Decentralized Finance: On Blockchain- and Smart Contract-Based Financial Markets | St. Louis Fed.

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Payment networks do much more than facilitate value exchange, they intermediate and assume both risk and support. For example, a key challenge in multi-party intermediation is enforceable contracts AND the ability of a third party to assume/underwrite risk. This is the core of the “trust function”.. [and a key contract vehicle]

From Innovation in Networks – Part 4 | Noyes Payments Blog.

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KEY POINT. Banks ENABLE commerce… they don’t create it. Banks do not “own” the consumer, merchant, platform, transaction, ….etc. Please forget about your super app dreams… you have a super card. V/MA networks enable bank financial intermediation

From Innovation in Networks – Part 4 | Noyes Payments Blog.

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New flows are far more important than existing flows. Existing payment volume is tremendously sticky. A change in existing volume is like changing 5 contracts with 5 parties with each of them receiving a new incentive (a challenge). New payment flows are thus the core of growth. The sources of new flows typically include New Markets, Merchants, Markets, Platforms, Governments, Consumer Champions, and Fortune 100 companies.

From Innovation in Networks – Part 4 | Noyes Payments Blog.

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Story – Connected Car (EV). Today Tesla has the best charging experience. My Tesla is connected to my car and my credit card. I pull into a Tesla supercharger and the station reads the ID of my car to activate the cable. Same thing happens when I activate Spotify.  Today all other EVs have a grand customer experience problem, with 100s of different charging stations. Payments will soon be integrated into all EVs to allow for a “Tesla like” experience, once integrated premium maps, parking, service calls, weather, music, … al will be “enabled” by integrated payment. This is not payment innovation.. This is the EV platform(s) driven by Fortune 100 companies.

From Innovation in Networks – Part 4 | Noyes Payments Blog.

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European citizens will have the choice of a nationally-provided digital identity wallet for pan EU use, rather than simply commercially-provided products, after a vote on the proposed update of the European Digital Identity Framework at the Industry, Research and Energy Committee was won by a large margin, reports the European Parliament new service.
The changes also mean anyone not wanting to use a digital ID wallet at all cannot be treated differently.
At present, people have to rely on digital wallets provided by the private sector, typically linked to payment systems, which has raised security and privacy concerns. National wallets are expected to give users better control over their data.
Other amendments to the framework ensure the digital identity wallets will be able to read and verify electronic documents and execute peer-to-peer interactions. The system must also register all transactions to ensure third parties can be held accountable.

From EU countries must provide sophisticated, national versions of digital identity wallet | Biometric Update:

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