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Source: Apple

Apple is making U.S. states foot part of the bill and provide customer support for its plan to turn iPhones into digital identification cards, according to confidential documents obtained by CNBC.

The company requires states to maintain the systems needed to issue and service credentials, hire project managers to respond to Apple inquiries, prominently market the new feature and push for its adoption with other government agencies, all at taxpayer expense, according to contracts signed by four states.

Apple announced in June that its users could soon store state-issued identification cards in the iPhone’s Wallet app, billing it as a more secure and convenient way for customers to provide credentials in a variety of in-person and remote settings. The feature, when combined with Apple’s biometric security measures like Face ID, could cut down on fraud.

But the move has brought questions from industry observers about why local authorities are ceding control of citizens’ identities to a $2.46 trillion private corporation. Beyond that, the integration of identity into powerful mobile devices has drawn concern from privacy experts about the risk of dystopian scenarios involving surveillance.

The contracts between Cupertino, California-based Apple and states including Georgia, Arizona, Kentucky and Oklahoma provide a rare glimpse into the dealings of the powerful company. Apple is known for its obsession with secrecy. It typically forces potential partners to sign non-disclosure agreements to prevent its documents from spilling into public view.

`Sole discretion’

The 7-page memorandum of agreement, obtained through public record requests from CNBC and other sources, mostly portrays Apple as having a high degree of control over the government agencies responsible for issuing identification cards.

Georgia and Arizona will be the first states to offer driver licenses on the Wallet app, but have yet to launch their programs. While the contracts obtained were virtually identical across states, CNBC did not review agreements for Connecticut, Iowa, Maryland and Utah, the four other states that have signed up for Apple’s digital ID program.

Apple has “sole discretion” for key aspects of the program, including what types of devices will be compatible with the digital IDs, how states are required to report on the performance of the effort, and when the program is launched, according to the documents. Apple even gets to review and approve the marketing that states are required to do.

The dynamic is similar to the way Apple typically deals with vendors, although instead of getting paid by Apple, the states have to shoulder the financial burden of administering the programs, according to Jason Mikula, a fintech consultant and newsletter author who obtained some of the contracts.

“It’s like a vendor relationship, which makes no sense to me because it’s the states that have the monopoly on what they’re giving to Apple, they could presumably negotiate a much more equal contract,” Mikula said in an interview. “I don’t know of any other example where government-owned systems and identity credentials were made available for commercial purposes in this manner.”

Apple declined to comment for this article. Representatives for Georgia, Arizona, Kentucky and Oklahoma didn’t immediately respond to requests for comment.

Along with the digitization of industries from finance to entertainment, there is a push around the world to create more modern digital ID systems. But efforts in countries including Singapore, France, Germany and China are implemented at the national level rather than through private companies, according to Phillip Phan, a professor at the Johns Hopkins Carey Business School.

Apple in control

Throughout the contracts, it’s clear who is in the driver’s seat.

Apple is asking states to comply with security requirements laid out by the International Organization for Standardization describing mobile driver licenses. Apple said in September it played an active role in the standard’s development.

States have to agree to “allocate reasonably sufficient personnel and resources (e.g., staff, project management and funding) to support the launch of the Program on a timeline to be determined by Apple,” according to the documents. That includes performing quality testing that the digital IDs work “in accordance with Apple’s certification requirements” across various Apple devices.

“If requested by Apple, Agency will designate one or more project manager(s) who shall be responsible for responding to Apple’s questions and issues relating to the Program,” the contract states.

States have to agree to wide-ranging efforts designed to ensure the adoption of Apple’s digital IDs, including by offering the new feature “proactively” and at no additional cost whenever a citizen gets new or replacement identification cards.

States also have to help spur adoption of the new IDs with “key stakeholders in federal and state government” like the Internal Revenue Service, state and local law enforcement, and businesses that restrict users by age who are “critical to the Program achieving a sufficient level of acceptance.”

While the state agencies have to “prominently feature the Program in all public-facing communications relating to Digital Identity Credentials,” the marketing efforts are “subject in all cases to Apple’s prior review and approval.”

All these efforts are paid for by states. The contract says that “except as otherwise agreed upon between the Parties, neither Party shall owe the other Party any fees under this Agreement.”

When asked if his state was in line for payments from Apple, a communications officer for the Arizona Department of Transportation confirmed that “no payment or economic considerations exist.”

No guard rails

The end result is that states bear the burden of maintaining technology systems at taxpayer expense, a move that ultimately benefits Apple and its shareholders by making its devices even more essential than they already are.

“Apple’s interest is clear – sell more iPhones,” Phan said in an interview. “The state’s interest is to serve its citizens, but I’m not sure why they think a partnership with one specific technology company that owns a closed ecosystem is the best way to do it. For the state to spend taxpayer’s money on a product that serves only half its citizens is questionable.”

Apple’s Wallet app is not a major revenue source for the company, although it generates fees from Apple Pay transactions, which is reported in the company’s services business. Instead, the Wallet app and other services are strategic features to make the iPhone more valuable to customers and discourage them from switching to competitors like Google’s Android.

Importantly, in its contract, Apple shifts responsibility for confirming the authenticity of user identities onto states: “Apple shall not be liable for any Verification Results, and Agency acknowledges that all Verification Results are provided `AS IS’ and without any warranty, express, implied or otherwise, regarding its accuracy or performance.”

The agreements are also notable for what is missing, in terms of constraints or guard rails on how Apple can use the powerful capability of identity verification, according to Mikula. That raises questions about whether the company can restrict access to the new capability for competitors’ products.

“Apple has a history of leveraging its dominant position in phone hardware and software to preference its own offerings and exact a toll from third parties using its platforms,” he said.

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USDC stablecoin issuer Circle files for IPO as public markets open to crypto

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USDC stablecoin issuer Circle files for IPO as public markets open to crypto

Jeremy Allaire, Co-Founder and CEO, Circle 

David A. Grogan | CNBC

Circle, the company behind the USDC stablecoin, has filed for an initial public offering with the U.S. Securities and Exchange Commission.

The S1 lays the groundwork for Circle’s long-anticipated entry into the public markets.

While the filing does not yet disclose the number of shares or a price range, sources told Fortune that Circle plans to move forward with a public filing in late April and is targeting a market debut as early as June.

JPMorgan Chase and Citi are reportedly serving as lead underwriters, and the company is seeking a valuation between $4 billion and $5 billion, according to Fortune.

This marks Circle’s second attempt at going public. A prior SPAC merger with Concord Acquisition Corp collapsed in late 2022 amid regulatory challenges. Since then, Circle has made strategic moves to position itself closer to the heart of global finance — including the announcement last year that it would relocate its headquarters from Boston to One World Trade Center in New York City.

Read more about tech and crypto from CNBC Pro

Circle is best known as the issuer of USDC, the world’s second-largest stablecoin by market capitalization.

Pegged one-to-one to the U.S. dollar and backed by cash and short-term Treasury securities, USDC has roughly $60 billion in circulation.

Circle is best known as the issuer of USDC, the world’s second-largest stablecoin by market capitalization.

Pegged one-to-one to the U.S. dollar and backed by cash and short-term Treasury securities, USDC has roughly $60 billion in circulation. It makes up about 26% of the total market cap for stablecoins, behind Tether‘s 67% dominance. Its market cap has grown 36% this year, however, compared with Tether’s 5% growth.

Coinbase CEO Brian Armstrong said on the company’s most recent earnings call that it has a “stretch goal to make USDC the number 1 stablecoin.” 

The company’s push into public markets reflects a broader moment for the crypto industry, which is navigating renewed political favor under a more crypto-friendly U.S. administration. The stablecoin sector is ramping up as the industry grows increasingly confident that the crypto market will get its first piece of U.S. legislation passed and implemented this year, focusing on stablecoins.

Stablecoins’ growth could have investment implications for crypto exchanges like Robinhood and Coinbase as they integrate more of them into crypto trading and cross-border transfers. Coinbase also has an agreement with Circle to share 50% of the revenue of its USDC stablecoin.

The stablecoin market has grown about 11% so far this year and about 47% in the past year, and has become a “systemically important” part of the crypto market, according to Bernstein. Historically, digital assets in this sector have been used for trading and as collateral in decentralized finance (DeFi), and crypto investors watch them closely for evidence of demand, liquidity and activity in the market.

More recently, however, rhetoric around stablecoins’ ability to help preserve U.S. dollar dominance – by exporting dollar utility internationally and ensuring demand for U.S. government debt, which backs nearly all dollar-denominated stablecoins – has grown louder.

A successful IPO would make Circle one of the most prominent crypto-native firms to list on a U.S. exchange — an important signal for both investors and regulators as digital assets become more entwined with the traditional financial system.

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Hims & Hers shares rise as company adds new weight-loss medications to platform

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Hims & Hers shares rise as company adds new weight-loss medications to platform

The Hims app arranged on a smartphone in New York on Feb. 12, 2025.

Gabby Jones | Bloomberg | Getty Images

Hims & Hers Health shares closed up 5% on Tuesday after the company announced patients can access Eli Lilly‘s weight loss medication Zepbound and diabetes drug Mounjaro, as well as the generic injection liraglutide, through its platform.

Zepbound, Mounjaro and liraglutide are part of the class of weight loss medications called GLP-1s, which have exploded in popularity in recent years. Hims & Hers launched a weight loss program in late 2023, but its GLP-1 offerings have evolved as the company has contended with a volatile supply and regulatory environment.

Lilly’s weekly injections Zepbound and Mounjaro will cost patients $1,899 a month, according to the Hims & Hers website. The generic liraglutide will cost $299 a month, but it requires a daily injection and can be less effective than other GLP-1 medications.

“As we look ahead, we plan to continue to expand our weight loss offering to deliver an even more holistic, personalized experience,” Dr. Craig Primack, senior vice president of weight loss at Hims & Hers, wrote in a blog post.

A Lilly spokesperson said in a statement that the company has “no affiliation” with Hims & Hers and noted that Zepbound is available at lower costs for people who are insured for the product or for those who buy directly from the company. 

In May, Hims & Hers started prescribing compounded semaglutide, the active ingredient in Novo Nordisk‘s GLP-1 weight loss medications Ozempic and Wegovy. The offering was immensely popular and helped generate more than $225 million in revenue for the company in 2024.

But compounded drugs can traditionally only be mass produced when the branded medications treatments are in shortage. The U.S. Food and Drug Administration announced in February that the shortage of semaglutide injections products had been resolved.

That meant Hims & Hers had to largely stop offering the compounded medications, though some consumers may still be able to access personalized doses if it’s clinically applicable. 

During the company’s quarterly call with investors in February, Hims & Hers said its weight loss offerings will primarily consist of its oral medications and liraglutide. The company said it expects its weight loss offerings to generate at least $725 million in annual revenue, excluding contributions from compounded semaglutide.

But the company is still lobbying for compounded medications. A pop up on Hims & Hers’ website, which was viewed by CNBC, encourages users to “use your voice” and urge Congress and the FDA to preserve access to compounded treatments.

With Tuesday’s rally, Hims and Hers shares are up about 27% in 2025 after soaring 172% last year.

WATCH: Hims & Hers shares tumble over concerns around weight-loss business

Hims & Hers shares tumble over concerns around weight-loss business

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Meta’s head of AI research announces departure

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Meta's head of AI research announces departure

Meta CEO Mark Zuckerberg holds a smartphone as he makes a keynote speech at the Meta Connect annual event at the company’s headquarters in Menlo Park, California, on Sept. 25, 2024.

Manuel Orbegozo | Reuters

Meta’s head of artificial intelligence research announced Tuesday that she will be leaving the company. 

Joelle Pineau, the company’s vice president of AI research, announced her departure in a LinkedIn post, saying her last day at the social media company will be May 30. 

Her departure comes at a challenging time for Meta. CEO Mark Zuckerberg has made AI a top priority, investing billions of dollars in an effort to become the market leader ahead of rivals like OpenAI and Google.

Zuckerberg has said that it is his goal for Meta to build an AI assistant with more than 1 billion users and artificial general intelligence, which is a term used to describe computers that can think and take actions comparable to humans.

“As the world undergoes significant change, as the race for AI accelerates, and as Meta prepares for its next chapter, it is time to create space for others to pursue the work,” Pineau wrote. “I will be cheering from the sidelines, knowing that you have all the ingredients needed to build the best AI systems in the world, and to responsibly bring them into the lives of billions of people.”

Vice President of AI Research and Head of FAIR at Meta Joelle Pineau attends a technology demonstration at the META research laboratory in Paris on February 7, 2025.

Stephane De Sakutin | AFP | Getty Images

Pineau was one of Meta’s top AI researchers and led the company’s fundamental AI research unit, or FAIR, since 2023. There, she oversaw the company’s cutting-edge computer science-related studies, some of which are eventually incorporated into the company’s core apps. 

She joined the company in 2017 to lead Meta’s Montreal AI research lab. Pineau is also a computer science professor at McGill University, where she is a co-director of its reasoning and learning lab.

Some of the projects Pineau helped oversee include Meta’s open-source Llama family of AI models and other technologies like the PyTorch software for AI developers.

Pineau’s departure announcement comes a few weeks ahead of Meta’s LlamaCon AI conference on April 29. There, the company is expected to detail its latest version of Llama. Meta Chief Product Officer Chris Cox, to whom Pineau reported to, said in March that Llama 4 will help power AI agents, the latest craze in generative AI. The company is also expected to announce a standalone app for its Meta AI chatbot, CNBC reported in February

“We thank Joelle for her leadership of FAIR,” a Meta spokesperson said in a statement. “She’s been an important voice for Open Source and helped push breakthroughs to advance our products and the science behind them.” 

Pineau did not reveal her next role but said she “will be taking some time to observe and to reflect, before jumping into a new adventure.”

WATCH: Meta awaits antitrust fine from EU

Meta awaits antitrust fine from EU

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