A team led by Alona Katz, the head of the Brooklyn District Attorney’s Virtual Currency Unit, has identified the servers orchestrating various cryptocurrency scams.
Katz refrained from disclosing specific methods to maintain operational security. However, the investigation revealed that many of the scammers’ servers were based in Eastern Europe, prompting the Brooklyn DA’s office to collaborate with the FBI.
The resulting operation led to the seizure and disruption of 240 cryptocurrency fraud websites and 112 computer servers. This action marks the largest success of Katz’s career thus far, although no arrests were made.
In a separate development, threat actors gained unauthorized access to Microsoft 365 accounts by exploiting application identities via a supply chain attack on ConnectWise’s Cloud Backup service (previously known as SkyKick Cloud Backup).
ConnectWise has halted customer access to the Cloud Backup service, and currently, there is no estimated timeline for restoration.
In financial markets, a steep decline in US technology stocks has revealed vulnerabilities in Asia’s artificial intelligence sector. Rising financing costs are threatening to inhibit the investment required to maintain the industry’s expansion, potentially impacting earnings across the broader supply chain that has supported the region’s stock market growth.
Last week, the situation escalated as oil prices climbed to $110 per barrel for the first time since May, raising inflationary concerns. Investors are now increasingly focused on the trillions of dollars being borrowed to develop AI infrastructure.
US semiconductor stocks experienced an eight-session downturn—the longest streak of declines since 2008—resulting in an approximately 16% decrease in the sector’s benchmark. Concurrently, the Nasdaq 100 endured its worst week since April 2025.
This downward trend in technology stocks has significant implications for Asian markets, particularly as chipmakers and component manufacturers have greatly benefited from the AI boom. As trading resumes on Monday, the situation remains precarious.
A Goldman Sachs index tracking regional AI hardware stocks plummeted by 11% last week, marking its sharpest drop since mid-July.
Despite an optimistic revenue forecast from Taiwan Semiconductor Manufacturing, concerns over AI-related spending are increasingly affecting the sector’s hardware supply chain.
Notably, some of Asia’s leading companies faced substantial losses during this period. Nan Ya Plastics, a producer of materials for printed circuit boards, saw a 12% decrease from its record highs. Similarly, rival Unimicron Technology, the second-best performer on the index, dropped by 14% within the week, while Samsung Electro-Mechanics, known for its diverse electronic components, fell by 23%.
“Financing costs are like gravity for the AI boom,” observed Jian Shi Cortesi, a fund manager at GAM Investment Management in Zurich.
“Increased borrowing costs could hinder infrastructure project financing and delay expenditures. Even slight setbacks could lead to a reassessment of earnings expectations and valuations among Asian suppliers.”
The issue is evolving beyond just whether the demand for AI chips will persist; it now encompasses whether major cloud operators can sustain the investment in the infrastructure necessary to implement them, alongside whether the anticipated returns will justify such investments.
Bonds from the neocloud provider CoreWeave fell to alarming lows as investors expressed doubts regarding whether AI demand and revenue could support its expansion financing.
CoreWeave’s shares dropped by 12% on Friday, marking its worst week since November with a cumulative loss of 25%. This situation underscored the financing risks associated with the sector, especially in light of rising oil prices that threaten to keep borrowing costs high.
While TSMC, SK Hynix, and Samsung Electronics supply the necessary chips and memory for AI computing, the health of their earnings relies fundamentally on ongoing investments in the infrastructure that utilizes these products.
Manufacturers of components and equipment are exposed to similar risks, often lacking transparency regarding the timing of individual projects.
<p“AI funding stress is a greater challenge for downstream beneficiaries than for the core compute ecosystem,” stated Kevin Net, a portfolio manager at Financiere de l’Echiquier in Paris.
“The further removed a company is from the chip itself, the higher the risk of encountering delays.”
Executives within the industry have voiced concerns regarding financing risks. Broadcom’s Chief Executive Officer Hock Tan indicated that access to capital, rather than shortages in memory chips or manufacturing capacity, would emerge as the primary constraint on AI growth.
Gartner Inc. has projected that over $3.5 trillion in AI infrastructure investments may face impairment risks by 2030 if spending continues to outstrip the revenue necessary to support it.
“If hyperscalers and neoclouds cannot finance their datacenter projects, that would lead to reduced orders for Asian enablers like TSMC, Samsung, and SK Hynix,” remarked Vey-Sern Ling, managing director at Union Bancaire Privee.
“Given the market’s current volatility, the implications would be very negative for semiconductor sector stocks.”
The stakes remain high for Asian equities, as the AI sector has become a predominant theme in investment strategies.
TSMC, Samsung, and SK Hynix collectively represent nearly a third of the MSCI Asia ex-Japan Index and about a fifth of the broader Asian gauge, with their suppliers magnifying the region’s exposure to this investment cycle, according to data compiled by Bloomberg.
Eight of the ten top-performing companies in the MSCI Asia-Pacific Index this year are component manufacturers, each experiencing gains of at least 236%. Such growth has left their earnings expectations and valuations at risk should spending trends slow or projects experience delays.
However, there is little evidence at this point to suggest that financial pressures have resulted in weaker orders. Some investors maintain optimism that strong demand will continue to support the sector.
“We are not concerned about the ongoing chip selloff,” said Kunjal Gala, the head of global emerging markets at Federated Hermes Ltd. in London. Gala’s fund is positioned heavily in Korea and holds shares of TSMC. [Bloomberg]
Crypto cop takes down global scam network: A team overseen by Alona Katz, chief of Brooklyn District Attorney’s Virtual Currency Unit, identified which servers were behind crypto scams, then seized and disrupted 240 crypto-fraud websites and 112 computer servers. It’s the biggest bust of Katz’s career in which no arrests were made. [Bloomberg]
Microsoft 365 tenants hacked through ConnectWise supply chain attack: Threat actors compromised Microsoft 365 tenants by accessing application identities via a supply chain attack targeting ConnectWise’s Cloud Backup service (formerly SkyKick Cloud Backup). ConnectWise shut down customer access to its Cloud Backup service with no estimated time to restore. [BleepingComputer]
Ads for Elon Musk documentary banned on TikTok, YouTube, Facebook, and Twitter/X: TikTok has banned the advertising account for the 4-hour “Musk” documentary. Google’s YouTube and Meta’s Facebook also initially banned the advertisements, but eventually allowed them on their platforms. X, which Musk owns, has refused to carry ads for the documentary. [Hollywood Reporter]
Qualcomm dismisses Snapdragon 8 Elite Extreme Gen 6 overheating reports: Qualcomm said rumours about the Snapdragon 8 Elite Extreme Gen 6 running into overheating issues were “inaccurate”. This followed a report that Samsung might skip the latest Snapdragon flagship. [9to5Google]
Ukraine’s Zelenskyy said Starlink speed restrictions look deliberate after U.S. denials: Restrictions on Ukraine’s military use of SpaceX’s Starlink system appear to be deliberate and not the result of any technical problems, President Volodymyr Zelenskyy said, while denouncing a US decision to waive sanctions against Russia. U.S. President Donald Trump stated he didn’t order any limitations on Ukraine’s access to the system and that he didn’t believe SpaceX chairman Elon Musk had either. Musk mentioned “any limits on speed or usage are decided by the US military and ultimately” the president. Secretary of State Marco Rubio noted that it’s “categorically false” that the White House had any role in the disruptions. [Bloomberg]
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