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Anthropic reveals Claude Sonnet 5: The middle child of the Anthropic frontier model family — less powerful than Opus, but an upgrade from Haiku — returns with its fastest, smartest, and most agent-friendly incarnation to date. In a blog post, Anthropic suggests that Sonnet 5 advances the model’s ability to make long-term plans, engage with computer interfaces like browsers and terminals, and operate autonomously. TechCrunch notes that all the major frontier labs — also including OpenAI and Google — are laser-focused on agentic capabilities in their latest releases, an indication that the latest AI race is now pivoting around making agents more capable, faster, and cheaper to run. For Anthropic’s part, Sonnet 5 is not QUITE as accomplished as Opus 4.8, but it’s a good deal more cost-effective, and also a relative savings vs. rivals like GPT-5.5 and Gemini 3.1 Pro. It naturally takes a solid benchmark lead over February’s Sonnet 4.6 release.
Nano Banana 2 Lite is also here: Speaking of fresh, hot AI debuts, Google dropped an upgrade to its Nano Banana series of text-to-image models. The new Nano Banana 2 (NB2) Lite (also known as Gemini 3.1 Flash-Lite Image if you aren’t into silly names) is the fastest and most cost-effective image generation option currently available from Google. It can produce fresh images in a mere 4 seconds, and costs just $0.034 sense per 1,000 outputs. There are of course SOME tradeoffs to get to that kind of breakneck speed. NB2 Lite supports just 1k resolution, as opposed to the 2k and 4k images the classic Nano Banana models can output. But in general, NB2 Lite is considerably powerful, even edging out the original Nana Banano Pro in terms of its Elo (image model) benchmark score.
Businesses unite around Open USD: A number of major crypto firms and payment networks — including American Express, Visa, Mastercard, Stripe, and Coinbase — signed on to a new stablecoin standard, known as Open USD. (They’re not alone. Several tech and consumer facing companies and apps are also on board, including Google, Samsung, and DoorDash.) The independent team behind Open USD, Open Standard, suggests that businesses will be able to mint and redeem the stablecoin without fees or volume limits, while income from OUSD reserves will be distributed to participating companies (save for a “small management fee”). The coin is expected to launch later on this year. Gizmodo notes that Open Standard largely resembles Meta’s 2019 attempt to forge a “digital currency consortium,” originally known as Libra but later rebranded as Diem. Of course, that project was born in a very different regulatory environment, prior to the GENIUS Act’s clarification of the stablecoin rules of the road.
TWiST 500
AI chip startup and TWiST 500 member in good standing Etched produces specialized chips known as ASICs, or Application-Specific Integrated Circuits. These chips are customized just for the Transformer architecture utilized by ChatGPT and Gemini, among others, and tailored exclusively for AI inference tasks.
Their flagship product is the Sohu chip, manufactured by Taiwan Semiconductor Manufacturing Co (TSMC), which is physically hardcoded to perform transformer attention calculations. While comparable GPUs from Nvidia can be used for a wide variety of tasks — from mining Bitcoin to rendering video game graphics — Sohu chips ONLY perform the specific math that powers AI inference processes. Etched claims that these specialized chips can process the same complex outputs as Nvidia’s H100 GPUs but with significantly fewer chips, meaning less energy required and at a fraction of the cost. The company doesn’t just design the chips, but the entire server rack infrastructure that ensures that can run at maximum capacity.
As if all that weren’t enough, Etched has also developed a proprietary technology called “low-voltage interference,” which allows them to run their racks at — you guessed it — lower voltage level, minimizing the risk of overheating.
The company revealed this week that they’ve raised $800 million in total funding. The round was led by Stripes, with participation from Peter Thiel, along with Positive Sum, Jane Street, Ribbit Capital, Nobel Prize-winning AI innovator Geoffrey Hinton, computer vision pioneer Fei-Fei Li, and others. (Some of the funds come from a venture firm linked to their chip-making partners, TSMC.)
It’s the first public disclosure from the stealthy company about their chips or fundraising in nearly two years (which is why you haven’t seen them mentioned in this space too frequently). CEO and co-founder Gavin Uberti tells Bloomberg "we’ve been very quiet until we had stuff to show off.” A sage, humble, and notably rare strategy among AI CEOs. – Lon
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This Week in Startups
E2306: It’s the debut of our new Summer 2026 series “TWiST All Stars.” We’re inviting back some of Jason’s favorite guests from throughout the long history of the pod, and we’re kicking things off with one of his “Besties,” investor and 8090 co-founder/CEO Chamath Palihapitiya. He’s talking about the groundbreaking development platform, which is helping enterprises save money and protect their data by building out their own internal software. Plus he shares with Jason his origin story, why he started the Learn With Me and Drink With Me communities, his advice for young people graduating college in the age of AI, and more.
E2305: Jason calls in from Hawaii for a new Friday TWiST, joined by co-host Lon and SKN Systems CEO Lyall Davenport. He’s designed a new kind of sensor tape that gathers aerodynamic data from cars in motion, at an incredible rate of 420M data points per hour. Find out how he hopes this tech can replace the old-fashioned wind tunnel simulators employed by racing companies like F1, along with future applications in defense, transportation, and beyond. Plus Jason’s thoughts on the government blocking OpenAI’s new models, why Apple’s Vision Pro chief defected, the growing data center backlash, and more.
E2304: Jason sits down with Brynn Putnam, CEO and founder of Board, to learn more about her company’s tabletop gaming console. The pair talks about how to raise capital for yet-to-launch hardware projects, the screen-time debate, and how Board is approaching building or buying IP for its family-friendly games. Next, Alex got Heremus’s AJ Piplica on the horn to chat hypersonic, autonomous jets. The startup’s technology bridges the gap between rockets and airplanes, and may represent the future of warfare, yes, but also fast freight!
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