AI Daily Newsletter: Claude Sonnet 5 Launches and AI Chip Etched Valued at 5 Billion USD

🔥 1. Anthropic Launches Claude Sonnet 5 — Cheaper, Stronger, Focus on AI Agent

Sonnet 5 is Anthropic’s new mid-size upgrade, specifically designed to run AI agents at a lower cost. For just $2/M input token (reduced to $3 after August), this model achieves 63.2% on the agentic coding benchmark — nearly equal to Opus 4.8 (69.2%) while being significantly cheaper. As of today, Sonnet 5 becomes the default model for both Free and Pro plans. Anthropic is proving that agentic capability has become the baseline — the game is now about price and reliability.

Source: TechCrunch

⚡ 2. Google Launches Nano Banana 2 Lite — Generates Images in 4 Seconds, $0.034/1,000 Images

Google continues to expand its Nano Banana line with the extremely affordable Lite version: just $0.034 for 1,000 images, with each image rendered in 4 seconds. This model replaces the original Nano Banana, targeting high-frequency workflows such as ad production and mass content creation. Google also expands Gemini Omni Flash (video $0.10/second) and launches Omni Product Studio — turning static images into cinematic commercial videos. Despite facing an “AI slop” backlash, Google is pushing forward.

Source: TechCrunch

🛡️ 3. Claude Code Found to Embed Steganography in System Prompt

A technical analysis causing a stir on Hacker News (1,329 points) reveals that Claude Code v2.1.196 silently embeds classification indicators into system prompts using Unicode apostrophe characters and date formatting. When using a non-official API base URL, Claude Code encodes information about the domain and timezone (especially China TZ) directly into the “Today’s date is…” sentence. Anthropic has not commented, but the developer community is questioning trust — a tool with filesystem access should not hide anything in plain sight.

Source: thereallo.dev

🤖 4. Meta Brain2Qwerty v2 — Reads Brain Signals into Text without Surgery

Meta AI has open-sourced Brain2Qwerty v2, a non-invasive brain signal decoding system using MEG, achieving 61% word accuracy — significantly higher than the 8% accuracy of previous methods. With the best participant, accuracy reaches 78%. Meta also fully opens the code and dataset, along with a $5M Digital Brain Project fund. Although invasive implants (Neuralink style) are still more accurate, Brain2Qwerty offers hope for millions of people who have lost the ability to communicate without needing surgery.

Source: Meta AI Blog

📊 5. Etched — AI Chip Startup to Overtake Nvidia Reaches $5B Valuation, $1B Sales

Etched, an AI chip startup founded by Harvard dropouts, has reached a $5B valuation after a $500M round and recorded $1B in chip orders for AI inference. TSMC has successfully produced their chips and is testing them with customers. Investors include Andrej Karpathy, Geoffrey Hinton, and Fei-Fei Li. The notable story: in 2023, they almost went bankrupt due to lack of funding, struggling from month to month. Now, they are the strongest competitor to Nvidia in the inference sector.

Source: TechCrunch