Pentagon Broker | Rewire News Evening Report

Pentagon’s Broker | Rewire News Nightly

Author:律动BlockBeats

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Reprinted: Mars Finance

The Defense Minister’s broker contacted BlackRock to buy a defense-industry fund before the war began. The deal didn’t go through because the channel wasn’t opened—not because someone blocked it.

1｜Hegseth’s broker tried to buy defense-industry ETFs before the war; the Pentagon demanded that the FT pull the story

In an article, the FT reported that U.S. Defense Secretary Hegseth’s broker at Morgan Stanley contacted BlackRock in February this year and requested the purchase of iShares Defense Industry Active ETF, planning to invest millions of dollars. The fund’s assets under management are about $3.1 billion, and its top three holdings are Raytheon (RTX), Lockheed Martin, and Northrop Grumman. On February 28, the U.S. went to war with Iran. The transaction ultimately was not completed. The reason was not regulatory review, but that the fund had not yet opened the product to Morgan Stanley’s clients.

Pentagon Chief Spokesperson Parnell said on X that the report was “completely false and fabricated,” and demanded that the FT pull the story. The FT stood by the report, and multiple other outlets including CNBC followed up. This is not an insider trading case—since the deal never closed, there’s no legal basis to pursue. But what it reveals is a structure more noteworthy than insider trading: between the people who direct the war and those who profit from it, there’s only a broker account. The trade failed because the product channel wasn’t connected—not because a conflict of interest was intercepted.

(From: FT / CNBC / Al Jazeera / US News)

2｜AI infrastructure hits an energy wall: $635 billion spending plan meets a shockwave from the Iran war

Melissa Otto, head of research at S&P Global, warned that Microsoft, Amazon, Google, and Meta’s combined $635 billion AI infrastructure spending this year is facing an energy-cost shock from the Middle East crisis. The figure is nearly double last year’s $383 billion. Otto said that sustained high oil prices may force cuts to capital expenditures in the first and second quarters, bringing “severe pullbacks across all markets.”

Meanwhile, Mistral borrowed $830 million to build data centers in Paris, outfitting them with 13,800 Nvidia GB300 GPUs. Emerald AI financing backed by Nvidia raised $25 million, using software to provide grid-flexible power scheduling for the data centers, with the goal of freeing an additional 100 gigawatts of capacity from the existing U.S. power grid. The war is driving up AI’s energy bill, but capital is still being injected.

(From: Reuters / S&P Global / TechCrunch / Fortune / Bloomberg)

3｜Bitcoin miners collectively pivot to AI: network hashrate falls for the first time in six years on a quarterly basis

Bitcoin’s network total hashrate saw its first quarterly decline since 2020 in Q1. It dropped from roughly 1 ZH/s at the end of last year to about 900–950 EH/s. On March 21, mining difficulty was lowered by 7.76%. Publicly listed miners are losing an average of $19,000 for each bitcoin mined, while more than $70 billion worth of AI hosting contracts have already been signed.

Core Scientific plans to sell most of its bitcoin holdings by year-end to raise funding for AI expansion, and Bitdeer cleared all of its bitcoin reserves in February. CoinShares estimates that by year-end, up to 70% of revenue for some miners may come from AI hosting, with operating profit margins of 80–90% and dollar-fixed income. Miners are not transforming—they’re using bitcoin shells to put AI inside.

(From: Tom’s Hardware / CoinDesk / The Block / CoinShares)

4｜China’s AI earnings season: doubling revenue is the default, doubling losses too

Zhipu released its first full-year earnings report after going public: 2025 revenue of 724 million yuan, up 131.9%, with a net loss of 4.72 billion yuan, widening 59%. Biren Technology turned in its first earnings report on the same day: revenue of 1.035 billion yuan, up 207%, gross margin of 53.8%, but losses remain high. China’s AI companies have drawn the same line: revenue is rising, while cash is burning.

iFlytek Intelligent and Eli Lilly signed a $2.75 billion AI drug discovery collaboration. The upfront payment is $115 million, and the core targets are preclinical oral GLP-1 drugs. The upfront payment is twice iFlytek’s full-year revenue. Apple’s AI China mainland version was briefly launched and then withdrawn due to “software issues.” Gurman said it was an accidental operation, and Apple still needs approval from the CAC. China’s AI money is burning, the drugs are being sold, but the AI on phones has not yet gained access.

(From: 36 Kr / SCMP / Bloomberg / STAT News / MacRumors)

It’s also worth knowing ↓

U.S. oil prices broke $4 per gallon, up 35% since the war began. The national average touched $4.018, the first time it has crossed the $4 mark since the Russia-Ukraine war in 2022. Diesel is $5.454. The Strait of Hormuz remains closed to most vessels, with global supply of roughly 4.5–5.0 million barrels per day disrupted. Analysts warn that if the strait isn’t reopened, oil prices could hit $5 per gallon. (Source: Axios / GasBuddy / Time)

Dubai and Abu Dhabi stock markets have evaporated $120 billion since the war began. The Dubai Financial Market index is down about 16% ($45 billion market cap), and Abu Dhabi is down about 9% ($75 billion). Tourism was hit the hardest: last year it contributed 13% of the UAE’s GDP ($70 billion), but since the war began, tens of thousands of flights have been canceled. (Source: Al Jazeera)

Stanford research: AI’s flattering rate toward users is 49% higher than humans. In a study published in the journal Science by Stanford’s Department of Computer Science, among 2,400 participants, most preferred being flattered by AI rather than being told the truth. On social issues, AI agrees with users 49% more than humans. As more and more people treat AI as a therapist, flattery is systematically reinforcing users’ cognitive biases. (Source: Fortune / Stanford)

Eurozone inflation rose to 2.5% in March, exceeding the ECB target. Soaring energy costs are the main driver, and oil and gas prices boosted by the Iran war are being transmitted to the European consumer end. The ECB faces a dilemma: slowing growth and rising inflation are happening at the same time. (Source: CNBC)

Cryptocurrency is being used to buy drones for Russia and Iran. Reuters cited a report saying that cryptocurrency is becoming the payment infrastructure for wartime economies, connecting two seemingly unrelated areas: cryptocurrency regulation and military conflict. (Source: Reuters)