U.S. Sanctions Aren’t Touching Russia’s Hottest Startup

SPEAKER_1 (0:00)

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Luke Vargas (0:34)

Iran dials up its demands to reopen the Strait of Hormuz. Plus, Meta embraces open-weight AI models in a bid to blunt the appeal of cheaper Chinese competition.

And we'll look at Russia's hottest startup, a government-backed sanctions evasion network.

Alex Frangos (0:51)

And it's trying to set up subsidiaries and telling other countries that may have problems accessing the international banking system because US or European officials have sanctioned them or cut them off saying, hey, we're here. We're here to help.

Luke Vargas (1:04)

It's Monday, August 10th. I'm Luke Vargas for The Wall Street Journal. And here is the AM Edition of What's News, the top headlines and business stories moving your world today.

Israeli Prime Minister Benjamin Netanyahu is formally rejecting President Trump's Gossip Peace Plan, as we discussed on Friday's show that comes after Netanyahu had made it clear that Israel hadn't agreed to the plan and had responded to the White House with comments. The proposal, which would see Hamas hand over its weapons in exchange for Israel withdrawing from Gaza, is meant to build on a ceasefire agreed to last October, which left many challenging questions about the territory's future unresolved. Meanwhile, a top Iranian official has upped the anti-negotiations to open the Strait of Hormuz, issuing a lengthy slate of demands for the US., including the ending of all sanctions, the payment of reparations, and a cessation of attacks against Iran's militia allies. Journal Middle East correspondent Benoît Faucon said those demands don't necessarily constitute Iran's formal position in talks, but the high hurdles to a potential deal are making it harder for President Trump to find an off-ramp from the conflict.

Benoît Faucon (2:16)

Obviously, that's a strategy for Iran to come up with unrealistic demands, hoping that they'd get something in the middle, but that really shows there's a big, wide space between the moment they even agree on transit and the moment they fully reopen the Strait of Hormuz.

So kind of an early agreement on the transit arrangements is possible. There's a lot of opposition from the IGC, the Revolutionary Guard, to finalize it, but that's the real possibility. An agreement to reopen, fully reopen Hormuz to traffic, that's really some time away. That's going to take a lot of negotiation.

Luke Vargas (2:51)

Earlier this month, President Trump called off a wave of US attacks aimed at breaking a deadlock in talks, citing progress in negotiations. However, mediators say the progress has stalled in recent days. And produce supplier Taylor Farms is recalling a range of products from grocery shelves after concerns they could be contaminated with salmonella. The recalled guacamoles and salsas contain jalapeno peppers that are tied to an earlier recall by Coast Citrus distributors. Taylor said it wasn't aware of any reported illnesses linked to its products containing jalapenos, while Grub Market, the owner of Coast Citrus, didn't immediately respond to a request for comment. The latest recall comes a month after federal agencies linked Taylor-supplied lettuce to thousands of cyclosporiasis illnesses across multiple states.

In a bid to address rising public frustration over the data center buildout and investor concerns, Meta's Mark Zuckerberg says that the company plans to release more open-weight AI models and funnel a billion dollars to communities hosting its data centers. In a lengthy essay, Zuckerberg criticized Meta's competitors for building AI for companies, governments, and other institutions, and said Meta would instead focus on, quote, putting power in people's hands. To do so, the company plans to launch a new AI model called Muse Glimmer in the coming weeks, featuring open-weights, letting users download the numerical values that determine its behavior and to fine-tune it for their own applications. While the US initially led the development of open-weight models, China has quickly caught up, and companies have begun turning to its models, which are often much cheaper than closed proprietary models developed in Silicon Valley.

Apple is trying to alleviate the AI memory chip crunch that's led it to raise prices on its devices globally, and in doing so, it's turning to China. We report that Apple has been testing memory chips from China's CXMT across product lines, including iPhones and Macbooks. But as journal Asia business editor Peter Landers explains, it needs to win the White House's blessing if it wants to do business with a Chinese company.