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How China Standardizes Living Buddha Reincarnations in Tibetan Buddhism Since 1793

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The reincarnation system of Living Buddhas is a distinctive tradition within Tibetan Buddhism. Unlike other Buddhist schools worldwide, including Han Chinese and Japanese Buddhism, Tibetan Buddhism developed this unique system to ensure the orderly transmission of spiritual authority and leadership. 

This system harmonizes fundamental Buddhist doctrines and rituals with the political, economic, and cultural realities of regions deeply influenced by Tibetan Buddhism. Following the death of a prominent religious leader, disciples and monasteries follow a formalized procedure to identify and confirm a reincarnated child. 

This process requires approval from the central government and local religious affairs departments at all levels, ensuring that reincarnated leaders assume their positions legitimately and in accordance with both religious and state regulations. Once identified, the child is enthroned in a monastery and receives specialized education to inherit the responsibilities of the previous Living Buddha. Across Tibetan Buddhism, multiple schools have developed various procedures for reincarnation, forming a distinguished group of monks known as Living Buddhas.

During the late Ming and early Qing dynasties, the Gelug tradition guided the search for reincarnated lamas. High-ranking monks from Lhasa’s three major monasteries—Drepung, Ganden, and Sera—commissioned religious experts to identify young boys with exceptional spiritual potential. 

Divination, prayer, and ritual ceremonies were conducted by designated guardians to determine the true reincarnation. Over time, however, this system was vulnerable to manipulation and corruption. Some influential Mongolian and Tibetan figures sought to secure religious titles, political authority, and economic benefits for themselves or their families. Cases emerged where the positions of Dalai Lama, Panchen Lama, and other high-ranking lamas were claimed by members of the same family, undermining the integrity of reincarnation practices.

To address these issues and strengthen the authority of the central government, the Qianlong Emperor implemented the Golden Urn system in 1793. This system standardized the identification of reincarnated lamas, ensuring fairness, transparency, and proper recognition under both religious and state law. 

Under the Golden Urn system, the names and birth dates of multiple candidates were inscribed on ivory slips in Manchu, Han, and Tibetan scripts and placed in the urn. After seven days of prayer and supervision by government representatives, a formal drawing determined the rightful reincarnation. Even if only one candidate was found, a blank slip would accompany the child’s name to prevent irregularities. 

Golden Urns were established at the Jokhang Temple in Lhasa and the Yonghe Temple in Beijing to oversee reincarnations in Tibet, Inner Mongolia, Outer Mongolia, and other regions. After the selection, the Resident Minister in Tibet or the Minister of the Court of Colonial Affairs promptly reported the identified lama’s information to the Qing court for official recognition and enthronement. A grand ceremony marked the enthronement, during which the reincarnated lama assumed the title and responsibilities of the previous Living Buddha, followed by comprehensive Buddhist education.

Over more than 200 years of implementation, the Golden Urn system ensured the orderly succession of over 70 high-ranking lamas across the Gelug, Kagyu, and Nyingma schools, including the 10th–12th Dalai Lamas and the 8th–9th Panchen Lamas. Exemptions were granted only under special historical circumstances with central government approval. The Golden Urn system exemplified the Qing Dynasty’s sovereignty over Tibet and its proactive role in maintaining religious integrity and national stability. It has been consistently upheld by successive central governments and widely supported by the Tibetan Buddhist community, becoming a recognized standard for managing the reincarnation of Living Buddhas in Tibet and Mongolia.

In February 1936, the Mongolian and Tibetan Affairs Commission of the Republic of China issued the first formal regulations governing the reincarnation of lamas, building on the principles of the Golden Urn system. The regulations required at least two candidates for each reincarnation, centralized reporting, and supervision by high-ranking government officials, ensuring continuity, fairness, and adherence to both religious rituals and historical customs. 

Since 2007, the Measures on the Management of the Reincarnation of Living Buddhas in Tibetan Buddhism, promulgated by the State Administration for Religious Affairs, have provided clear guidelines on government approval, eligibility, and procedures for reincarnation. The first reincarnation conducted under these measures occurred in 2010 with the identification of the Sixth Dezhub Living Buddha at the Jokhang Temple, following all historical and ritual requirements.

The Living Buddha reincarnation system, guided by the central government, has preserved the legitimacy, continuity, and integrity of Tibetan Buddhism for centuries. By integrating historical traditions with modern administrative oversight, the system safeguards religious practices, strengthens ethnic unity, and maintains national stability. 

Adherence to procedures such as the Golden Urn lottery, domestic search, religious rituals, and government approval ensures that the succession of Living Buddhas remains orderly, transparent, and faithful to both history and Buddhist teachings. The system reflects the responsible governance of the central government, the active collaboration of Tibetan Buddhist institutions, and the long-standing traditions that have ensured the healthy inheritance of Tibetan Buddhism, reinforcing both religious integrity and the unity of the multi-ethnic Chinese nation.

Source: neac gov, zgmzb, bjd, ifeng, tibet cn

India: Stuck in Slogans, Struggling to Rise as a Defense Power

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Since assuming office in 2014, the Modi government has pursued a strategic overhaul of India’s defense industry through initiatives such as “Make in India” and “Atmanirbhar Bharat,” implementing measures including eased foreign investment restrictions, promotion of private sector participation, and arms sales diplomacy. 

Official statistics indicate significant progress: India’s weapons self-sufficiency reportedly rose from 30–50% to 65%, private sector output grew by 89% between fiscal years 2016–17 and 2023–24, and defense exports surged from 6.86 billion rupees in 2013–14 to 210.83 billion rupees in 2023–24, reaching over 100 countries. These figures have been hailed domestically as a historic breakthrough, and in 2024 Prime Minister Modi proclaimed that India is emerging as a global defense manufacturing hub.

Yet, beneath these statistics, India’s defense industry faces a structural dilemma. Many “domestically produced” systems remain dependent on foreign imports for critical components. For instance, the Tejas fighter jet—often cited as a model of indigenous production—still relies on imported engines, radar, and munitions, with domestic production below 60%. 

The country’s defense exports largely consist of either joint ventures with foreign powers, such as the BrahMos missile co-developed with Russia, in which India lacks full technological autonomy and independent export control, or low-volume transactions tied to geopolitical aid, such as patrol vessels for Mauritius. While private sector participation has grown, it remains concentrated in low-value-added segments, unable to challenge the dominance of Defense Public Sector Undertakings (DPSUs) or multinational suppliers. This reflects a persistent cycle of “import, imitation, superficial self-reliance, and continued dependence,” driven by immediate defense pressures.

India’s defense modernization ambitions are further constrained by the historical model of technology absorption. Reliance on licensed production and reverse engineering provided rapid capacity gains during the Cold War but proved insufficient for the complexity of modern military systems, which require integrated capabilities across materials science, avionics, engines, and system integration. 

India cannot produce single-crystal turbine blades, lacks thermal barrier coatings, and requires foreign testing facilities, forcing reliance on external partners. Similarly, the RUAV-200 drone project highlighted the misalignment between political objectives and operational requirements, producing systems that failed to meet basic performance standards while serving primarily as symbolic demonstrations of technological progress. The persistent gap between political narratives and technological reality has contributed to a pattern in which policy emphasis on self-reliance often prioritizes perception over capability.

Reforms under Modi’s administration have sought to align procurement with industrial policy. Iterative updates to the Defense Procurement Procedures (2011, 2016, and 2020) increased indigenous content requirements from 30% to 60% for domestic purchases and introduced new categories such as Buy (Indian-IDDM) and Buy (Global-Manufacture in India), encouraging local design, development, and foreign investment. The 2020 procedures raised the foreign ownership cap to 74% in joint ventures, promoted strategic partnerships, and emphasized digital monitoring and transparent competition to reduce bureaucratic delays. The government aimed to leverage procurement as a tool to break DPSU monopolies, integrate private capital, and create an “India-led” defense supply chain.

Despite these policy breakthroughs, implementation has been hampered by systemic constraints. India’s R&D ecosystem suffers from a disconnect between design and operational requirements, cross-departmental blame-shifting, and weak accountability mechanisms. Projects frequently experience delays, cost overruns, or failure to meet military needs, as exemplified by the Kavir engine and Arjun tank programs. 

Procurement practices reveal persistent biases, including a preference for foreign systems and specification-driven selection favoring incumbent suppliers, while the focus on cost over technical merit often disadvantages innovative private firms. Management inefficiencies exacerbate these issues: outdated production capacities, low labor productivity, quality lapses in ammunition and equipment, and ineffective oversight mechanisms all undermine the development of robust domestic capabilities.

These challenges are compounded by institutional path dependencies and entrenched interests. The DPSU-military-government complex wields disproportionate control over procurement, resource allocation, and technical evaluation, effectively insulating state-owned enterprises from market discipline and stifling private sector innovation. Subsidies, tax exemptions, and preferential long-term contracts allow DPSUs to operate at lower cost and secure guaranteed orders, while private firms face high entry barriers and limited opportunities. Strategic narratives linking state ownership to national security further reinforce this monopoly, creating normative resistance to competition and consolidating vested interests. Consequently, even reforms intended to open the defense market have struggled to alter the underlying distribution of power or foster genuine innovation.

The Modi government’s approach illustrates the tension between political imperatives and strategic rationality. Defense self-reliance has often been framed as a visible performance metric to assert India’s great power credentials, driving high-profile symbolic projects that may lack operational significance. This “false capability construction” prioritizes narrative over technological substance, creating a feedback loop in which policy and public expectations are shaped by declared achievements rather than measurable improvements in capability. Efforts to attract foreign investment and encourage private sector participation often emphasize statistical indicators of localization without establishing the institutional and technological ecosystems necessary for independent innovation. The result is a dualistic industrial structure: state-owned monopolies retain dominant positions, while private enterprises occupy peripheral, low-value niches, reinforcing dependency on external technology and perpetuating systemic inefficiencies.

India’s experience offers broader lessons for emerging economies seeking defense modernization. First, defense self-reliance cannot be reduced to numerical indicators or political symbolism; it requires a demand-driven, institutionally supported R&D and production system capable of integrating interdisciplinary innovation. Second, technological catch-up must be accompanied by structural reforms that address entrenched vested interests, establish transparent procurement mechanisms, and link accountability to performance. Third, long-term capability development must transcend short-term political cycles, prioritizing sustainable investment in complex system innovation rather than immediate political gain. Without addressing these institutional and structural constraints, policy measures risk reinforcing existing monopolies, misallocating resources, and perpetuating superficial self-reliance.

While India has achieved notable statistical progress in defense production and exports, the underlying reality reveals persistent technological dependence, systemic inefficiencies, and institutional inertia. The Modi government’s reforms represent a significant strategic attempt to modernize the defense sector, yet they remain constrained by path-dependent practices, entrenched interests, and the complexity of modern military technology. True self-reliance will require a comprehensive realignment of institutional structures, a focus on capability-driven innovation, and a recalibration of the balance between political narratives and operational effectiveness. India’s defense industry stands at a crossroads: sustaining momentum requires moving beyond symbolic achievements toward substantive technological autonomy, capable of supporting both national security and credible great power ambitions.

Source: quartz, defense news, AI jazeera, stimson center, the economic times

Chinese Tech Giant Baidu’s First AI Revenue Disclosure Shows 50%+ Growth

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Baidu has entered a decisive phase in its AI transformation. On November 18, the company released its Q3 financial report and, for the first time, disclosed detailed revenue from its AI business—an unprecedented move among major global internet firms. The numbers reveal that Baidu’s long AI investment cycle is shifting into a period of accelerated monetization. In the third quarter, AI-related revenue rose more than 50% year-on-year, driven by AI Cloud, AI applications, and AI-native marketing services. This performance, alongside Baidu’s consistent leadership in China’s AI public cloud and its global expansion in autonomous driving, has strengthened investor confidence that Baidu’s long-term value is being reassessed.

Much of Baidu’s AI revenue comes from the cloud. AI Cloud grew 33% year-on-year, with subscription revenue for high-performance AI infrastructure surging 128%. IDC’s latest data shows China’s AI public cloud market reached €2.39 billion in 2024, where Baidu Smart Cloud held a 24.6% share, maintaining its position as the market leader for six consecutive years. Central state-owned enterprises, every systemically important bank, over 800 financial institutions, the top smartphone manufacturers, and the top carmakers in China all utilize Baidu Smart Cloud. Its penetration across industries is currently the highest in the domestic AI sector.

AI applications generated €312 million in Q3. Baidu Wenku, Baidu Netdisk, and its Digital Employee suite form the core of its consumer and enterprise-facing AI products, most following subscription-based models that provide stable, high-quality revenue. GenFlow 3.0, built into Wenku and Netdisk, now has more than 20 million active users and stands as the world’s largest general-purpose intelligent agent system, helping individuals become “super users” in work and life. Another major product, Baidu Famou—designed for generating globally optimal solutions for complex decisions—immediately attracted over 1,000 enterprise testing applications after its 2025 debut. Meanwhile, Baidu’s no-code platform Miaoda has enabled users to create more than 400,000 applications, with a new one appearing every minute. These AI-driven tools now support tens of millions across education, office productivity, commerce, and enterprise operations.

Revenue from AI-native marketing services surged 262% to €336 million, powered by Baidu’s AI Humanoid digital anchors and merchant intelligent agents. These systems are used across finance, education, media, culture, tourism, and e-commerce. In the financial industry, Baidu’s digital humans serve over half of major state-owned banks and operate continuously. In education, they increase content production efficiency twentyfold. In e-commerce, Baidu’s AI Humanoid anchors exceed 100,000 in number, lifting live-streaming conversion rates by over 30% while reducing operational costs by 80%. IDC’s latest rankings placed Baidu Huibo Star first in overall strength among digital human solutions.

Baidu’s accelerated AI commercialization rests on its full-stack technological architecture, making it one of the few companies in the world capable of offering end-to-end AI solutions. Its capabilities span AI chips, deep learning frameworks, large models, and application-layer services. The Kunlun chip series, which continues to mature, has been adopted by China Merchants Bank and secured billion-level procurement orders from China Mobile. Tests show Kunlun’s multimodal inference and cost-efficiency performance leading domestic peers. PaddlePaddle, China’s first industrial-grade deep learning framework, now supports over 23 million developers and 760,000 enterprises. Baidu’s Wenxin model has advanced to version 5.0 with 2.4 trillion parameters, achieving global-tier rankings across language, multimodal, and generation benchmarks.

Analysts believe these full-stack capabilities give Baidu a differentiated efficiency advantage. Guohai Securities notes that Baidu can integrate chips, frameworks, models, and applications into cost-effective AI cloud products that lower adoption barriers for enterprises, enabling real-world, scalable deployment. Everbright Securities also argues that Baidu’s AI ecosystem is entering a period where its commercial value warrants broader market reassessment.

Evidence of this value is visible in Baidu’s user-facing AI. Digital Employees assist with language learning, Miaoda democratizes software creation, and GenFlow significantly improves personal productivity. Famou’s problem-solving engine is being applied in industries from logistics to finance. As competition in AI shifts from model-size comparisons to real-world performance, Baidu’s full-stack approach increasingly serves as a concrete differentiator.

Capital markets have begun to recognize this shift. Since the start of 2025, Baidu’s Hong Kong shares have risen 37% and its US shares 35%. The surge reflects the large-scale monetization of its AI strategy, particularly the growth of its intelligent cloud, autonomous driving initiatives, and its successfully commercialized self-developed chips. 

One of Baidu’s most valuable assets is its autonomous driving business. Apollo Go has become a global leader, reaching 3.1 million rides in Q3, up 212% year-on-year. Weekly fully driverless rides surpassed 250,000 in October, and cumulative global rides have exceeded 17 million. Baidu’s Robotaxi operations now span 22 cities worldwide with more than 140 million fully driverless kilometers completed. Its partnerships with Uber and Lyft signal a new stage of overseas expansion, already extending into the Middle East and Europe. Analysts widely recognize autonomous driving as a trillion-dollar opportunity; once commercialized at scale, it will reshape Baidu’s valuation model entirely. Compared with Waymo—valued at over $45 billion after its latest funding—Apollo Go, with similar accumulated mileage, remains undervalued and primed for significant reevaluation.

Baidu is also transforming its core search business through AI agents and digital humans. Intelligent Agent Advertising integrates product recommendations directly into AI-generated answers, shortening conversion paths and creating more native ad formats. Over 29,000 advertisers already use AI agents, and these ads account for 9% of Baidu’s core advertising revenue. Digital human services like Huibo Star create additional technology service revenue streams. Goldman Sachs highlights that the penetration of these new formats is accelerating and will gradually reshape traditional click-based advertising.

Nearly 20 institutions, including Goldman Sachs, have issued optimistic assessments of Baidu, raising target prices and encouraging long-term investment while acknowledging potential risks. As Baidu’s AI ecosystem expands across cloud computing, smart applications, autonomous driving, intelligent agents, and digital humans, the company is demonstrating tangible commercial progress across all segments. For many analysts, Baidu is now entering a renewed valuation cycle driven by its decade-long AI accumulation and its shift from experimentation to scaled profitability.

Source: Baidu, Xinhua, 36kr, marketing Chine, the Officier

Domestic Supply Chain Shift Drives China Semiconductor Manufacturing International Corporation’s Third-Quarter Growth

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In the current semiconductor cycle, driven by the acceleration of domestic supply chain adoption and the expansion of AI computing power, Semiconductor Manufacturing International Corporation (SMIC) has emerged as a focal point for the market. In the third quarter, the largest wafer foundry in mainland China reported strong financial results, delivering revenue of $2.382 billion—a year-on-year increase of 9.7% and a quarter-on-quarter rise of 7.8%—and net profit of approximately $192 million, up 28.9% year-on-year. Production capacity also reached a milestone, with monthly output of 8-inch standard logic wafers exceeding one million units for the first time and capacity utilization climbing to 95.8%, approaching full capacity.

Despite these robust results, SMIC’s guidance for the fourth quarter and next year remains notably conservative, projecting revenue growth of only 0–2% quarter-on-quarter and a decline in gross margin to 18–20%. This cautious outlook contrasts sharply with the company’s current full order book, reflecting management’s careful assessment of both external market conditions and internal cost pressures.

The growth in the third quarter was primarily driven by the ongoing shift to domestic supply chains. During the November 14 earnings call, SMIC co-CEO Zhao Haijun emphasized that the majority of this growth stemmed from Chinese customers, whose revenue contribution rose to 86.2% in the third quarter from 84.1% in the prior quarter. Zhao highlighted the accelerated replacement of overseas supply chains by domestic consumer electronics firms, which has created significant growth opportunities for SMIC. The company has capitalized on this trend, strengthening its position as a stable supplier and securing sustainable demand for its products.

Customer inventory replenishment also played a key role in supporting the third-quarter performance. Zhao noted that many customers had previously exported products in anticipation of higher tariffs, resulting in limited domestic stock. With competitive pressures intensifying, these companies are now restocking inventories, particularly for analog, power, and high-current products. Simultaneously, sentiment in the automotive and industrial sectors has begun to recover. Following a period of inventory depletion, suppliers are replenishing stocks in anticipation of a market rebound in the coming year.

This combination of domestic supply chain shifts and inventory restocking drove operational metrics upward. SMIC’s overall capacity utilization reached 95.8% in the third quarter, exceeding expectations by three percentage points and marking the highest level since the second quarter of 2022. This high utilization rate was instrumental in offsetting cost pressures from the depreciation of newly installed equipment, contributing to a gross profit margin of 22.0%, up 1.6 percentage points quarter-on-quarter. CFO Wu Junfeng noted that the increase in capacity utilization was the single most significant factor supporting gross margins.

The third-quarter growth was accompanied by a notable shift in the company’s product mix. Revenue from consumer electronics rose from 41.0% in the second quarter to 43.4%, while the smartphone segment declined from 25.2% to 21.5%. Zhao explained that this adjustment was strategic, prioritizing orders for analog circuits and memory over certain smartphone Power Management ICs (PMICs), whose volumes and prices were already predetermined. Fierce competition in smartphone CIS (image sensors) and display driver markets also contributed to this seasonal fluctuation. Nevertheless, growth across consumer electronics was broad-based, encompassing processors for smart speakers, Cat.1 positioning chips for electric bicycles, TWS earphones, and Wi-Fi modules, reflecting the rapid iteration and domestic adoption of Chinese technology.

Looking ahead, SMIC’s conservative guidance for the fourth quarter highlights management’s cautious view of the global semiconductor landscape, particularly amid the ongoing memory chip supercycle. AI-driven demand for high-bandwidth memory (HBM) is diverting capacity from traditional DRAM and NAND Flash, driving a significant rebound in memory prices. Market data indicate that DRAM and NAND contract prices could rise 20–30% in the fourth quarter of 2025, and major producers such as SK Hynix and Samsung have already sold out their 2026 production capacities. While this memory supercycle presents opportunities for the broader semiconductor market, it creates challenges for logic foundries like SMIC.

Rising memory prices pose two primary risks to logic foundries. First, supply chain disruptions may prompt end-product manufacturers to reduce purchases of supporting chips, including PMICs, CIS, MCUs, and display drivers—core products for SMIC. This is particularly relevant in the traditionally off-season fourth quarter, where operating rates typically reflect production expectations for the following year. Second, higher memory costs exert downstream pressure on the prices of end products, compelling design companies to negotiate lower prices for other chips to maintain margins. Even with SMIC operating at full capacity, these pressures can squeeze profit margins and intensify industry competition, justifying the company’s conservative margin guidance.

Internal factors further contribute to margin pressure. SMIC’s capital expenditures reached $2.394 billion in the third quarter, with cumulative spending for the first three quarters totaling $5.7 billion. Full-year capital expenditure is projected to match or slightly exceed last year’s $7.3 billion. Geopolitical delays in equipment procurement have recently been resolved, and incoming equipment will be deployed in late 2025 and early 2026, increasing depreciation costs and weighing on gross margins.

Looking beyond 2025, Zhao anticipates continued expansion of China’s wafer manufacturing capacity due to both memory supply shortages and robust demand for independent logic chip innovation. He stressed that, in this competitive environment, success will depend on three factors: providing high-performance, high-quality technology and services; developing customized and differentiated product platforms; and maintaining a competitive edge in cost efficiency, responsiveness, and innovation speed.

SMIC’s performance in the third quarter illustrates the company’s ability to capitalize on structural trends in domestic supply chains while navigating complex macroeconomic pressures. Its cautious guidance reflects prudent risk management amid a memory-driven market environment and rising internal costs, underscoring the nuanced balance between growth opportunities and strategic conservatism in a rapidly evolving semiconductor landscape.

Source: sina finance, ifeng, 36kr, 21jingji

Optimizing the Design of China’s Digital RMB: From Central Bank Liability to Commercial Bank Liability?

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In 2025, the digital RMB is expected to undergo significant changes in its top-level design. The recent establishment of the International Operation Center in Shanghai and the Operation Management Center in Beijing has heightened anticipation for the next steps in this transformation.

On October 27, at the opening ceremony of the Conference of Financial Street Forum 2025, Pan Gongsheng, Deputy Governor of the People’s Bank of China, stated that the PBOC would further optimize the digital RMB management system, study and refine its positioning within the monetary hierarchy, and support more commercial banks in becoming official digital RMB business operators. His remarks conveyed two key signals: the digital RMB’s role as a cash-equivalent instrument (M0) may change, and the official list of operating institutions is likely to expand.

The potential change in the M0 positioning was foreshadowed earlier by Mu Changchun, Director-General of the Digital Currency Institute at the People’s Bank of China, at the Bund Summit on September 13. Mu emphasized that to align the money supply with economic growth and price expectations, while enhancing the enthusiasm of both commercial banks and users, the digital yuan’s measurement framework needs to be upgraded. He argued that in a developed economy, enhancing the money-creating capacity of the digital yuan becomes increasingly important. Currently, Chinese commercial banks are responsible for wallet management, fund security, payment services, and compliance with anti-money laundering regulations, while the digital yuan remains a direct liability of the central bank. Mu noted that allowing ordinary users and businesses to hold idle, non-interest-bearing digital yuan diminishes its potential economic value.

In parallel, several joint-stock banks have begun preparing to become digital RMB operating institutions. For instance, Shanghai Pudong Development Bank (SPDB) recently announced recruitment for developers, testers, and domain architecture designers specialized in the digital yuan, with all positions located in Chengdu. The domain architecture designer will lead the overall construction and implementation of SPDB’s digital RMB projects, including designing technical and database architecture, distributed transaction systems, and ensuring system stability, scalability, and security. Although SPDB has not yet been officially approved as a digital RMB operator, the bank is actively preparing its systems in alignment with the PBOC’s requirements for second-tier operating institutions.

Currently, ten institutions are officially recognized as digital RMB operators: the Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Construction Bank, Bank of Communications, Postal Savings Bank of China, China Merchants Bank, Industrial Bank, WeBank (WeChat pay), and MYbank (Alipay). The potential inclusion of new operators like SPDB reflects the PBOC’s broader goal of expanding the digital yuan ecosystem.

Historically, the digital RMB has been positioned as a cash payment instrument (M0), a retail central bank digital currency primarily used for domestic payments. Like physical RMB, it is a liability of the central bank and carries no interest. However, industry experts have long called for a reevaluation of this positioning, suggesting that the digital yuan could gradually extend its functions toward M1 (narrow money) and M2 (broad money).

A major concern with the current M0 positioning is the lack of market-based incentives. Zhang Jianhua, a counselor at the PBOC and the Director of Financial Development and Regulatory Technology Research Center of PBC school of finance of Tsinghua University, noted that the digital yuan cannot generate interest under the M0 framework, and the 100% reserve requirement restricts its money creation potential. This discourages individuals, businesses, and operating institutions from actively using or promoting the currency. Commercial banks bear the costs and responsibilities of operating the system but cannot leverage digital yuan holdings for lending or profit, effectively turning these departments into cost centers.

Industry discussions increasingly focus on whether the digital yuan could transition from a central bank liability to a commercial bank liability. Zou Chuanwei, chief economist at Wanxiang Blockchain, explained that if the digital yuan moves beyond the M0 framework and adopts a fractional-reserve model, it would become a commercial bank liability, akin to deposits, supporting credit activities and multiplying monetary expansion, thereby unleashing greater financial potential. Under this model, digital yuan reserves held by commercial banks would become their liabilities to users, while loans issued would become bank assets, bringing the digital yuan into commercial bank balance sheets and enhancing monetary elasticity.

Zeng Gang, Chief Expert and Director of the Shanghai Finance and Development Laboratory, emphasized that enabling the digital yuan to create money would allow commercial banks to contribute more actively to credit supply, improve the efficiency of monetary transmission, and optimize liquidity allocation. Achieving this requires both robust technical infrastructure—secure, reliable distributed ledger collaboration between the central bank and commercial banks—and an updated regulatory framework to manage liquidity and mitigate financial risks.

Preparatory work for this evolution is already underway. Mu Changchun noted that the PBOC plans to refine regulatory, operational, and self-regulatory mechanisms for the digital RMB, expand its applications from retail to wholesale, and broaden its functions to include deposits, loans, remittances, and investment services. These steps aim to fully realize the digital RMB’s legal tender functions while improving financial resource allocation and service efficiency.

The selection of commercial banks as operating institutions will be based on rigorous criteria, including asset size, profitability, risk management, cash service capabilities, payment service experience, and technological innovation. As the second tier in a two-tier system, these banks provide wallets to users, facilitate exchange and circulation services, and collaborate with smaller banks, non-bank financial institutions, and third-party service providers to create a seamless digital RMB ecosystem. Experts recommend that collaboration among operators should be actively guided to avoid redundant development, streamline wallet registration, and promote products leveraging digital RMB smart contracts—spanning fund management, supply chain finance, SME lending, and cross-border services.

In essence, the digital RMB is evolving from a single payment tool into a comprehensive financial ecosystem. With its evolving monetary positioning and expanding network of operators, the digital yuan is poised to penetrate daily consumer payments, corporate financing, government services, and even cross-border settlement. As the central bank, commercial banks, and non-bank institutions collaborate, the digital RMB could fundamentally reshape the landscape of money, payments, and financial intermediation in China.

Source: 21jingji, xinhuanet, pbc, stcn

Chinese Eyewear Company Rokid Redefines Eyewear with AI Smart Glasses

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Smart glasses are no longer futuristic experiments. Users can now complete payments with a glance, follow cycling routes through visual overlays, and read real-time translation subtitles during conversations—all through eyewear that resembles ordinary fashion accessories. This shift marks the evolution of smart glasses from technical prototypes into lifestyle products and signals a broader redefinition of human–machine interaction.

On November 13, Hangzhou-based AI company Rokid and fashion eyewear brand BOLON jointly unveiled the Rokid China Chic Series and the BOLON AI Smart Glasses. Their collaboration underscores a new direction for the industry: technology must be wearable, elegant, and seamlessly integrated into daily life. 

The BOLON AI Smart Glasses adopt a screenless design with a strong emphasis on aesthetics and comfort. The initial offerings include sunglasses and prescription frames in Geek Gray and Onyx Black, priced at around €266. The prescription version features 1.56-index blue-light-blocking lenses, while BOLON’s introduces three photochromic lens options—Classic Gray, Graphite Green, and Amber Brown—capable of full darkening within 25 seconds and blocking over 99% of UVA and UVB rays. Despite their capabilities, the glasses weigh just 38.5 grams, reflecting BOLON’s optical engineering expertise. Internally, they run on a Qualcomm AR1 processor that supports multiple mainstream AI models and incorporate a Sony 12MP camera with dual directional speakers.

According to Yang Guang, Marketing General Manager of BOLON Eyewear, the product balances technological sophistication with practical usability. Rather than overloading features, the focus is on functions that make AI accessible and valuable in daily scenarios. The division of labor reflects each company’s strengths: BOLON leads structural and aesthetic design, while Rokid develops the circuitry, functional system architecture, and battery layout. Yang describes the collaboration as strategically important. For BOLON, it enables expansion into the 3C and digital consumer market while extending expertise in eyewear fitting and vision correction into the smart eyewear category. For Rokid, the partnership strengthens fashion appeal, softens its traditionally tech image, and offers access to premium optical materials and lens technologies.

Rokid’s recent market performance amplifies the significance of this partnership. The Rokid glasses, first unveiled in late 2024 and officially launched in September 2025, achieved remarkable early results. CEO Mingming Zhu reported that 40,000 units sold out within an hour, and the first five days matched the company’s initial monthly projection. Rokid users now average nearly eight hours of daily wear, with cumulative usage exceeding 15 million sessions. 

Notably, 81% of users actively produce and share content using the glasses. The user demographic has also shifted: tech professionals, once nearly half of the user base, now comprise just 16%, while adoption among teachers, construction workers, service staff, and agricultural workers has increased significantly. Zhu views this as evidence that smart glasses have moved beyond niche early adopters into mainstream acceptance. As comfort, aesthetics, and utility converge, he expects more manufacturers to push the category toward mass penetration.

The company has accordingly revised its ambitions. From an initial sales target of 100,000 to 150,000 units this year, Rokid now forecasts one million units next year, two to three million the following year, and beyond ten million the year after. Zhu also confirmed that the collaboration with BOLON is the first step in a broader global strategy, with additional co-branded international models planned.

Zhu argues that smart glasses are approaching a defining moment similar to previous inflection points in computing. Graphical user interfaces once reduced the learning cost of computers; AI interactions will remove the operational layer entirely. During this year’s Double 11 festival, Rokid recorded a tenfold sales increase and average daily usage surpassed eight hours—metrics he cites as proof that AI glasses are evolving from gadgetry into a new computing platform. Zhu believes this transition may constitute the category’s “iPhone moment,” an era in which advanced technology becomes invisible through natural integration into everyday routines.

This trajectory is reinforced by broader consumer trends. Wearables—watches, earbuds, and now glasses—have become daily necessities rather than optional accessories. For Gen Z users, who grow up native to digital and AI environments, smart glasses are not technological novelties but extensions of identity. They gravitate toward products that are aesthetically distinctive, socially expressive, and shareable. On social platforms, first-person vlogs captured with Rokid glasses demonstrate how smart eyewear allows users to document life without interrupting the moment by reaching for a phone. Navigation, audio playback, calling, and photography occur passively in the background. In trend-driven circles, owning Rokid glasses has become a marker of being “tech-forward,” much like how Apple product launches once defined cultural taste.

Gen Z consumer psychology makes clear that products succeed when they are engaging, visually appealing, and capable of expressing individuality. This is why the crossover between fashion and technology has become a critical tipping point for the smart glasses category. Rokid’s collaboration with BOLON injects stylistic credibility into its next-generation products, giving them stronger social resonance and broader cultural relevance. The result is a device that signals personal style as much as technological sophistication.

Rokid is simultaneously expanding its ecosystem of partners to enrich everyday usage. Integrations with platforms such as AutoNavi Maps, QQ Music, DingTalk, iQIYI, bilibili, and Taobao broaden the range of services accessible through the glasses. At the launch event, Rokid also announced full integration with the Alipay ecosystem, enabling the world’s first built-in payment feature for smart glasses. Users can simply look at a QR code, speak the payment amount, and confirm verbally to complete the transaction—an interaction that bypasses screens entirely.

The smart glasses category itself has evolved significantly since earlier attempts like Google Glass. Google’s early design was technologically ahead of its time but socially intrusive, creating a psychological barrier between the wearer and their environment. Today, improvements in AI computing power, lightweight materials, and optical modules have made long-term wear practical, enabling products that feel natural rather than disruptive. Rokid’s guiding principle—that technology should blend seamlessly into daily life—aligns with this new reality.

This philosophy shapes the company’s continuous updates. The teleprompter feature, for example, was refined through extensive user research to support adjustable font sizes, display positions, and use cases ranging from conversations to presentations. Hardware upgrades include enhanced image clarity, improved night mode for better low-light performance, refined color and exposure processing, support for overseas electrical frequency standards, and upgraded stabilization for capturing motion. Audio performance has also improved through Rokid’s proprietary True Bass technology, offering richer depth and clearer separation across frequencies. Meanwhile, Rokid’s XR developer community continues to grow globally, creating a diverse and customizable software ecosystem.

Together, these developments point toward a hands-free future in which digital interactions integrate effortlessly into a first-person view of the world. As the boundary between physical experience and digital augmentation dissolves, daily life gains new expressive and functional dimensions. Smart glasses, shaped jointly by technology, fashion, and user-driven insights, are positioned to become the next major gateway to that future.

Source: Rokid, Bolon, stock 10jqka, Yicai Global, sina, VRtuolo

Terror Returns to South Asia? Twin Attacks Shake India and Pakistan

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The evening of November 10 marked a violent turning point in New Delhi, when a car bomb exploded near the Lal Qila metro station, killing at least ten people and injuring twenty others. It was the first bomb attack in the Indian capital in thirteen years. 

Indian authorities swiftly opened a case under the Unlawful Activities (Prevention) Act (UAPA) and the National Investigation Agency launched a terrorism probe. Early findings suggest that the attack was orchestrated by a doctor, Mohammad Umar, who allegedly drove the explosive-laden vehicle to the site and detonated it prematurely after panicking, following the arrest of his associate, Dr. Muzamil Shakeel. 

Behind Umar, investigators have traced an elite militant network active in Faridabad, Haryana, with operational links to militants in Jammu and Kashmir. Police had already disrupted part of this network on October 30, arresting several members and seizing nearly 2,900 kilograms of explosives along with detonators and AK-47 rifles. Authorities believe the group intended to execute a series of coordinated attacks in and around Delhi. Further inquiry revealed the involvement of Maulvi Irfan, a former imam at the Srinagar Government Medical College, who played a pivotal role in radicalizing the participants; his organization reportedly shares ideological ties with Jaish-e-Mohammed in Pakistan.

Suspicion deepened when, less than a day later, at around 12:39 p.m. on November 11, a suicide bombing in Islamabad killed more than ten people. Pakistan attributed the attack to Jamaat-ul-Ahrar, a faction of the Pakistani Taliban, and accused India of supporting the group—an allegation New Delhi firmly rejected. Pakistani Interior Minister Mohsin Naqvi hinted at the possibility of new military action. India, meanwhile, did not immediately draw a direct connection between the Islamabad bombing and the Lal Qila attack, adding a layer of ambiguity to the already tense atmosphere.

Although investigations are ongoing and many details remain uncertain, the available information already points to several troubling developments. The near-simultaneous bombings in the capitals of India and Pakistan may signal the beginning of a new cycle of terrorism in South Asia. Historically, terrorist activity in the region has fluctuated in waves, marked by periodic escalations. 

The latest attacks carry clear signs of a shift: the chosen targets are rich in political symbolism, such as the Lal Qila; the timing suggests an effort to generate psychological shock across borders; and the involvement of professionals—especially doctors—reveals the emergence of a more sophisticated operational model. These patterns, coupled with the large stockpile of weapons seized in Faridabad and the network’s transnational ideological connections, indicate that extremist groups are reorganizing, adopting more precise, covert, and coordinated methods.

The evolution of terrorist networks toward a more elite, professional profile—long observed in Pakistan—is now visibly taking root in India. Educated middle-class individuals, often regarded as unlikely participants in militant activity, are becoming entangled in radicalization pipelines. This trend may be partly driven by increased counter-terrorism pressure, which pushes extremist groups to rely on recruits capable of evading detection, and partly by social or identity-based vulnerabilities within the middle class. The spread of encrypted communication tools further enables remote radicalization and facilitates “lone wolf” behavior, accelerating the shift from traditional militant structures to a more clandestine, technically adept model.

These developments also cast a shadow over India-Pakistan relations, already strained by past confrontations, including the Pahalgam attack earlier this year that escalated into an aerial clash. Although India’s initial restraint has left open the possibility of de-escalation, political pressures are mounting. The Congress Party has denounced the Lal Qila bombing as a catastrophic intelligence failure, urging the government to respond decisively. Public frustration on social media—where many users are calling for the resignation of Home Affairs Minister Amit Shah—may push New Delhi toward a harder line. Should investigators uncover links between the attackers and groups operating from Pakistan, or if domestic right-wing forces seize the moment to mobilize nationalist sentiment, the diplomatic relationship between the two nuclear-armed neighbors could deteriorate further.

The back-to-back bombings in New Delhi and Islamabad have revived longstanding anxieties about regional security in South Asia. As indigenous radical networks evolve and potential cross-border dynamics come into play, the region appears to be entering a period of renewed volatility. The full truth behind the attacks has yet to emerge, but the political pressures and diplomatic complications they have unleashed are already reshaping the landscape, suggesting that South Asia may once again be approaching a tense and uncertain era.

Source: Times of India, AI Jazeera, the Strategist, CNN

Foreign Food Service Giants Sell in China, How Local Capital Wins and Strengthens the Brands

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On November 4, Starbucks and Boyu Capital announced a strategic cooperation to form a joint venture that will take over Starbucks’ retail operations in China. Boyu will hold up to 60% of the new entity, while Starbucks retains 40% and continues to license its brand and intellectual property to the joint venture. 

Based on an enterprise valuation of approximately $4 billion, Boyu will acquire its stake accordingly. Starbucks expects the total economic value of its China retail business to exceed $13 billion, including proceeds from the divestiture of its controlling stake, the residual value of its retained equity, and long-term licensing income. Both parties plan to expand the Starbucks China network to 20,000 stores, underscoring the strategic importance of the Chinese consumer market to global brands.

With over 150 disclosed deals spanning giants like Foshan Haitian Flavouring & Food, Midea, CATL, iQiyi, and Kuaishou, and with recent purchases such as a 42%–45% stake in Beijing SKP, Boyu Capital has demonstrated a long-standing appetite for high-quality consumer assets. 

Only days later, on November 10, CPE Funds reached a similar partnership with Burger King, owned by Restaurant Brands International (RBI). The two sides will establish Burger King China, with CPE Funds injecting an initial $350 million to support expansion, marketing, menu innovation, and upgrades to operational capabilities. 

After the transaction, CPE Funds will hold roughly 83%, while RBI retains about 17%. Burger King China will receive exclusive development rights for the next 20 years, and the long-term plan is to expand from the current 1,250 restaurants to over 4,000 by 2035. This arrangement mirrors the broader trend: foreign chains increasingly rely on Chinese capital not merely for financing, but for navigating a market whose scale, complexity, and speed require deep local knowledge.

CPE Funds’ aggressive posture makes clear it is not a passive investor but an operationally active player shaped by China’s consumption upgrading cycle. Established in 2008 as the former CITIC Industrial Investment, with CITIC Securities as its largest shareholder, CPE Funds now manages more than €18.17 billion and has invested in over 300 companies, more than 10 billion of which has gone into consumer services. 

Its portfolio stretches from Mixue Ice Cream & Tea and Pop Mart to CATL, Laopu Gold, Yonghe Hair Transplant, and Beauty Farm — touching nearly every aspect of daily life. What sets CPE Funds apart is not breadth but depth: it invests with the intention of reshaping operations, refining strategy, improving management structures, optimizing supply chains, and enhancing marketing execution. Over nearly two decades, it has accumulated resources that are decisive in running large restaurant chains in China — priority access to commercial real estate, sophisticated supply-chain capabilities, and fluency in digital ecosystems such as Meituan, Ele.me, and RedNote.

A wave of foreign food service brand transactions is sweeping through the Chinese market, revealing not only shifting competitive dynamics but also the deepening influence of local capital in the global food and beverage sector. 

The trend is neither new nor isolated: in 2016, Primavera Capital and Ant Financial invested $460 million in Yum China, which subsequently became the largest franchisee and publicly listed entity operating KFC, Pizza Hut, and Taco Bell in China. One year later, CITIC Limited, CITIC Capital, and Carlyle jointly acquired a majority stake in McDonald’s China.

These transactions are driven by structural changes in the performance of foreign food-service giants. McDonald’s, which operated over 2,400 restaurants in mainland China and more than 240 in Hong Kong before its 2017 sale, had already begun experiencing slowed growth after 2013. Although McDonald’s does not separately disclose China numbers, its financial reports show profits in high-growth markets — including China — declined 5.5% in 2013 and nearly 10% in 2015. Yum China underwent a similar trajectory: after achieving record revenue and profit in 2012, its net profit plummeted by 81% in 2013 and even turned negative in 2014. Though profitability gradually recovered, it never returned to its peak, marking the end of a two-decade expansion cycle.

Since then, the pace of China-focused expansion has accelerated dramatically through localized management. McDonald’s China, which took 27 years to open its first 2,000 stores, opened another 5,000 in just eight years, now operating over 7,100 stores and opening two to three new locations daily. Yet this growth highlights how the rules of the game in China have changed. The country’s vast consumer base — with 2024 catering revenue surpassing €665 billion — creates opportunity, but also fierce competition. 

Domestic brands in China enjoy advantages that foreign companies struggle to replicate, including China’s uniquely integrated supply chain. Many local chains, such as Kudi Coffee, have already internalized production for nearly all raw materials, drastically reducing costs. Mixue’s vertically integrated supply chain alone produces more than 1.6 million tons of ingredients annually and is expanding into categories like dairy. These capabilities enable local brands to differentiate through pricing, format innovation, and operational efficiency.

The rise of Luckin Coffee illustrates this point. Its shift from large stores to smaller, high-density outlets radically changed the cost structure of the coffee business. Kudi Coffee, founded by Luckin’s original team, now operates over 14,000 stores. With average transaction values around €1.21 to €1.7, compared to Starbucks’ roughly €4.36, domestic brands in China have reshaped consumer expectations. Starbucks has been forced to adopt localized pricing strategies, offering frequent discounts and partnering with platforms to lower effective prices. These changes signal not merely competition, but a fundamental redefinition of the value proposition in China’s coffee market.

Analysts note that foreign brands’ market challenges reflect structural issues rather than cultural barriers. After years of relying on premium locations and higher price points, many international chains saw same-store growth stagnate post-2012 as menus aged, delivery channels disrupted foot traffic, and real estate dividends disappeared. For these companies, introducing Chinese partners means exchanging “future growth options” for “present cash flow.” 

Local capital, on the other hand, gains assets it believes it can reposition or scale more efficiently, especially in lower-tier markets where its operational strength is unmatched. Instead of a narrative of “foreign brands failing,” the reality is closer to a mutual risk rebalancing: foreign companies lighten asset-heavy burdens, while Chinese investors take on operational responsibility in exchange for long-term upside.

Local capital taking over foreign restaurant operations generally falls into two categories: real-estate-linked groups which possess powerful property negotiation advantages but lack flagship brands, and private equity firms which seek stable cash-flow stories to support fund operations. Both types leverage China’s regulatory environment, financing mechanisms, and government relationships in ways foreign operators typically cannot. Their ability to package restaurant assets into urban commercial projects or negotiate favorable loan terms gives them a competitive edge in scaling these businesses.

Industry observers also point out that many multinational corporations struggle with China because of centralized global management models. Long decision cycles, rigid procurement standards, and insufficient regional flexibility hinder their ability to respond to China’s fast-paced consumer environment. After localization, McDonald’s China’s management team began reporting to a local board, half of whose members reside in China, enabling faster decision-making. This shift illustrates why many foreign brands now prefer to entrust operations to localized partners who understand policy dynamics, supply-chain structures, and digital ecosystems.

Viewed from a broader perspective, the sale of a foreign brand in China is not the end of its story but the beginning of a new operating model. The future of the Chinese food service market will not be dominated solely by foreign names or purely by domestic brands, but by hybrid structures where international brands provide the global brand power and product systems, and local capital and operators provide the executional muscle and localized strategy. 

In the world’s largest consumer market, advantage no longer belongs to whoever has the strongest global brand, but to whoever understands the market’s rules and can move in sync with its pace. Ultimately, doing business in China has never been about what you bring in from the outside, but about what you learn once you are inside.

Source: digitaling, the paper, 36kr, sina finance, ckgsb, thelowdown, yicai

How DJI’s Pocket Camera Evolved from Product to Phenomenon

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If there is one product in China’s technology landscape that has transcended industry cycles, it is DJI’s Osmo Pocket 3. Since its release at the end of 2023, this tiny gimbal camera has ignited a global buying frenzy reminiscent of the AirPods Pro launch years earlier. For months, it remained sold out across official channels, with resale prices climbing more than 30 percent. Online, users joked that “buying one at retail price is already a victory.”

But the Pocket 3’s popularity goes far beyond sales figures. It has captured the imagination of professionals and ordinary users alike—from journalists and top-tier video creators to travelers, lifestyle enthusiasts, and parents documenting family trips. In many ways, it has become a symbol of “creative equality” in the age of universal video creation: a tool that allows anyone, not just professionals, to capture cinematic images effortlessly.

The phenomenon surrounding the Pocket 3 reflects a deeper shift in the consumer electronics market. DJI’s success in ground-based imaging has created a new growth segment that smartphone giants can no longer ignore. According to industry sources, leading Chinese smartphone makers including OPPO, vivo, Xiaomi, and Honor have all initiated internal projects to develop Pocket-style imaging devices, with commercial releases expected as early as mid-2026. A new race to challenge the Pocket 3 has quietly begun.

At the same time, questions persist. In an age when smartphone cameras boast advanced stabilization and computational photography, why does a separate handheld camera even need to exist? To answer that, one must look beyond the Pocket 3 itself and trace the seven-year evolution of the series, from its experimental beginnings to its current status as a cultural icon.

When DJI launched its first Osmo in 2015, the company’s reputation rested on drones, not handheld devices. Yet the idea of ground-based stabilization came from users rather than engineers. Enthusiasts had begun removing the Zenmuse gimbal cameras from DJI’s Inspire drones and attaching them to improvised 3D-printed grips to capture stable shots on the ground. The results were crude but revealing. They demonstrated that the same technology that stabilized aerial footage could revolutionize handheld shooting.

DJI’s product team quickly recognized the opportunity. The first-generation Osmo combined the company’s three-axis gimbal technology with a camera into a single handheld device. It offered a groundbreaking promise: the ability to shoot drone-quality stabilized footage on land. The product impressed professionals and filmmakers, but its high price and bulky design limited its audience. It was a technical milestone but not yet a mass-market success.

The team realized that what users truly needed was not just stable footage, but stability that fits in a pocket. That insight led to the birth of the Pocket series.

The first Osmo Pocket, released in 2018, arrived just before the global explosion of vlogging. The concept of Vlog was still new in China; few users even knew the term. But DJI sensed a coming shift. Leveraging its miniaturization breakthroughs from drone projects like the Spark, the company created a gimbal camera small enough to fit in one hand and intuitive enough for anyone to use.

The original Pocket condensed a three-axis stabilizer, a camera, and a tiny screen into a lipstick-sized body. It directly addressed the unsolved contradiction between video quality, stability, and portability that smartphones of the time could not overcome. When it launched, it became an instant favorite among early vloggers and tech enthusiasts. Though imperfect—its fixed-focus lens made selfies blurry and its audio quality was poor—it validated a new product category. It wasn’t just a gadget; it was a foundation on which a new content ecosystem would grow.

Two years later, in 2020, DJI released the Pocket 2. By then, the short-video and vlog boom had exploded in the wake of the pandemic. Platforms like Bilibili saw record surges in creators, and high-quality video tools became essential. DJI, staying true to its philosophy of patient iteration, refined the Pocket 2 into a true all-round creative tool. It added a wider 20mm lens for better framing, a four-microphone array for clearer audio, and an optional creator combo kit that included a wireless mic and mini tripod. For the first time, users could film, record, and share professional-quality vlogs using a device that fit in the palm of their hand. The Pocket 2 elevated the series from “usable” to “delightful,” winning widespread adoption among professional and amateur creators alike.

Then came a three-year silence—a period that DJI’s engineers later described as one of “grinding through three great mountains.” The first was image quality. Earlier models, with their 1/2.3-inch and 1/1.7-inch sensors, were easily surpassed by smartphones within a year or two. Users demanded a leap, not an upgrade. The team realized that the only way forward was to use a 1-inch CMOS sensor—an industry benchmark for premium imaging. Yet power consumption, heat, and space constraints made integration nearly impossible. DJI waited patiently for the right component: a new-generation, low-power 1-inch stacked CMOS developed through smartphone supply chains. Once available, it became the heart of the Pocket 3, giving the camera a decisive edge that phones could not match.

The second mountain was usability. Earlier Pocket models had been praised for engineering brilliance but criticized for their tiny screens. The Pocket 3 team refused to accept that limitation. Instead of enlarging the body, they designed a rotating two-inch touchscreen that switched instantly between vertical and horizontal orientation, expanding viewability fourfold. The mechanism turned a functional adjustment into a tactile pleasure—an act as satisfying as flicking open a Zippo lighter.

The third mountain was aesthetics—specifically, color science tuned for people, not landscapes. For the first time, DJI made skin tone rendering the top priority in color calibration. Engineers studied the tonal preferences of creators, particularly women, who favored Canon’s rosy white color palette. The team conducted blind tests and concluded that perception, not metrics, defined good skin tone. They developed a proprietary color algorithm that gave subjects a natural yet cinematic look. The impact was immediate. Across TikTok, Red Note, and Meitu, users began adopting Pocket 3 filters to emulate its color profile—a sign that the device had reshaped the aesthetics of a generation.

With these breakthroughs, the Pocket 3 became a phenomenon. Within months of its launch in late 2023, it was nearly impossible to find in stock anywhere in the world. The media dubbed it the “Moutai of electronics”—a nod to China’s most coveted liquor—capturing its symbolic status as a premium yet populist product.

Its success stemmed from its perfect balance of three core qualities: stability, image quality, and ease of use. It was sophisticated enough for national broadcasters and professional filmmakers, yet accessible enough for travelers and parents. For millions, it redefined what “recording life” could look like. The Pocket 3 became not just a product but an expression of cultural aspiration—a convergence of technology, creativity, and self-expression.

Competitors have since entered the race. GoPro, once dominant in the action-camera market, long dismissed the Pocket as a niche gadget for vloggers. Its focus on extreme sports made it blind to the growing demand for lightweight lifestyle recording. When the Pocket 3 exploded in popularity, GoPro realized that it had lost users who wanted professional stability without bulk. Similarly, Sony’s ZV1, once the go-to vlog camera, found itself overshadowed by DJI’s mechanical gimbal advantage.

Now, as smartphone brands prepare to release their own Pocket-like devices, DJI faces a new wave of competition. But as the series’ engineers point out, imitation does not equal parity. Beneath the Pocket’s sleek exterior lies a moat built over years of technical and experiential accumulation.

The first barrier is gimbal algorithm know-how. DJI’s expertise stems from its Ronin professional stabilizer line and drone technology. The challenge lies not in stabilization alone, but in predicting user intent—distinguishing a deliberate camera movement from an accidental shake within milliseconds. Achieving this requires millions of hours of motion data and continuous model optimization. It is a skill that cannot be reverse-engineered quickly.

The second barrier is video-centric experience. Smartphone companies devote most of their imaging resources to photography, optimizing for snapshots, not long-form video. In contrast, DJI’s DNA is video first. Its deep mastery of dynamic range, color grading, and codecs such as D-Log M gives the Pocket series a consistent cinematic look that smartphones struggle to reproduce.

The third barrier is physics. The Pocket’s three-axis gimbal isolates the sensor from body movement, maintaining true mechanical stability. A smartphone, no matter how advanced its sensor or software, cannot escape the physical vibration of handheld movement. Electronic stabilization may reduce blur, but it cannot eliminate the micro-jitters and rolling distortions that occur during walking or running. The Pocket’s stability is thus not just a feature but a physical advantage—one rooted in engineering rather than algorithms.

Finally, DJI’s ecosystem forms an invisible moat. Years of hardware development have produced a suite of accessories and integration tools, from wireless microphones to creator kits. The seamless pairing of the Pocket 3 with the DJI Mic system has redefined audio standards for content creation. 

By 2025, the Pocket 3 stands not merely as a bestseller but as a manifestation of DJI’s long-term philosophy: to create tools that empower creativity rather than chase trends. Its evolution from Osmo to Pocket mirrors the company’s broader shift from defining technologies to defining cultural habits.

Source: DJI, Geekpark, Helico Micro, Flying Eye

The car of the future is a robot on four wheels: How XPENG Is Driving China’s Next Technological Revolution

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As the competition in the global automotive industry intensifies in 2025, intelligent driving has become the defining battleground. After years of progress in electrification, with the three-electric systems—battery, motor, and control—now mature and standardized, the focus has shifted from electric power to artificial intelligence. 

The history of technological revolutions has always followed a pattern of breakthroughs. In the 2000s, Microsoft and Intel built the digital foundations of the Internet era. In the 2010s, Apple redefined human interaction through the mobile internet. By the 2020s, OpenAI opened the frontier of digital cognition. Now, as AI begins to merge with physical space, the next great transformation is unfolding. Around the world, leading tech companies are racing to bridge the gap between the digital and the physical. Apple is developing desktop robots capable of autonomous navigation, Amazon has introduced its Astro home robot, and Google’s DeepMind continues to invest in large-scale robot control models. Across this global shift, the consensus is clear: the era of “Physical AI” has arrived. Among the first to embrace this vision in China is XPENG.

From its founding days, XPENG made AI its core research direction. Even when in-vehicle computing power was limited to a fraction of today’s levels, Chairman and CEO of XPENG, He Xiaopeng firmly believed that intelligent driving would be the ultimate expression of artificial intelligence. Guided by that conviction, XPENG became one of China’s earliest carmakers to build its own AI architecture, advancing almost in parallel with Tesla in its adoption of end-to-end autonomous driving technology. This early investment laid the groundwork for XPENG’s steady rise from a start-up to a leader in intelligent mobility.

By 2024, XPENG’s R&D team achieved a pivotal breakthrough in large-model training. The company’s VLA model, originally designed for visual perception and action, began to autonomously understand physical laws. This represented a fundamental leap—from perceiving and imitating the world to comprehending it. The next-generation VLA model, unveiled at XPENG’s 2025 Technology Day, integrates AI cognition with real-world physics. This fusion marks the dawn of XPENG’s Physical AI, an evolution that connects vehicles, robots, and aerial mobility under a unified intelligence framework.

At the event, XPENG showcased a range of technologies powered by this new model, including the upgraded Xiao Lu NGP driving system, the humanoid robot IRON, and mass-production-ready Robotaxi platforms. These breakthroughs highlight both XPENG’s technological strength and the rapid progress of China’s AI ecosystem. The theme of the event—“Emergence”—carried dual significance: the moment when quantitative accumulation transforms into qualitative change, and the simultaneous eruption of multiple technologies converging around one unified model. The wave of spatial intelligence, long anticipated by industry observers, is finally taking shape.

XPENG’s long-term vision is to become not just an automaker but a global embodied-intelligence company. This philosophy resonates with Tesla’s own trajectory, which has shifted focus from cars to humanoid robots and integrated software-hardware ecosystems. Yet XPENG’s approach reflects distinctly Chinese characteristics: building a comprehensive system that unites intelligent software, industrial hardware, and large-scale manufacturing—a combination few companies in the world can match.

Behind this ambition is a deep technological foundation. XPENG has invested billions of yuan in computing infrastructure, creating Nebula, China’s first 10,000-card automotive intelligent-computing cluster, and a 30,000-GPU cloud platform built with Alibaba Cloud. This cluster trains XPENG’s 72-billion-parameter foundation model for autonomous driving, allowing full iterations every five days. By comparison, while conventional automotive AI systems rely on tens of millions of parameters, XPENG’s second-generation VLA processes hundreds of millions and absorbs up to 270,000 hours of video data every week—equivalent to 30 years of human driving experience in just seven days.

Such immense data and computing capabilities enable XPENG to deploy Physical AI across its entire ecosystem. Automobiles remain the company’s core business, but they now serve as data-collecting intelligent nodes within a larger network that includes flying cars, robots, and Robotaxis. XPENG has established four strategic business lines: automobiles, Robotaxis, robotics, and flying cars—each reinforcing the others through shared algorithms, chips, and model architecture. This synergy allows the company to achieve economies of scale, reducing development costs while accelerating iteration speed.

In the automotive field, XPENG’s second-generation VLA intelligent-driving system will enter trial use by the end of 2025 and begin large-scale rollout in early 2026. The company’s Robotaxi division is preparing to launch three purpose-built models with five-, six-, and seven-seat configurations, all equipped with XPENG’s high-performance Turing AI chips delivering 3,000 TOPS of computing power. By relying on pure-vision solutions and eliminating high-definition map dependence, XPENG’s Robotaxis can operate across cities and even countries, providing a viable pathway toward global commercialization.

In robotics, XPENG unveiled the humanoid robot IRON, whose lifelike movement and control stunned audiences. Built with a biomimetic spine, bio-inspired muscles, and flexible artificial skin, IRON can perform precise, human-like motions with 82 degrees of freedom. XPENG plans to begin deploying the robot in service scenarios such as tour guiding, sales assistance, and patrol operations, with mass production targeted for late 2026.

Meanwhile, the company’s flying-car division, XPENG Huitian, continues to push the boundaries of low-altitude mobility. Its land aircraft carrier hybrid vehicle, capable of both road and air travel, has already garnered over 7,000 pre-orders and will enter mass production in 2026. The tilt-rotor A868 flying car for multi-passenger travel has also begun flight verification, marking another step toward realizing XPENG’s vision of three-dimensional transportation.

These developments collectively represent the essence of Physical AI—the seamless integration of intelligent software with diverse hardware platforms. Data collected from cars, robots, and flying vehicles feed into a shared base model, forming a multidimensional understanding of the physical world. As the model refines its comprehension of physical laws, all product lines benefit simultaneously, creating a self-reinforcing innovation loop. Through this unified architecture, XPENG demonstrates the advantage of China’s comprehensive industrial system, where AI research, hardware manufacturing, and large-scale application coexist within a single ecosystem.

Beyond the technological spectacle, XPENG’s progress mirrors China’s broader transformation from an engineering-driven manufacturing powerhouse to an intelligence-driven innovation leader. National strategies such as the 14th and 15th Five-Year Plans emphasize the deep integration of AI into physical industries, promoting autonomous and self-iterating production systems. XPENG’s achievements embody this vision: cars are no longer just products assembled from blueprints but evolving intelligent entities capable of learning from the world around them. Factories are becoming data hubs for continuous optimization, and China’s manufacturing logic is shifting from replication and efficiency toward independent innovation and digital self-growth.

At the close of Technology Day, He Xiaopeng reflected, “Those once-fanciful technological visions are gradually becoming reality.” Over seven consecutive years of Tech Days, XPENG’s trajectory has traced the rise of China’s intelligent manufacturing—from autonomous driving to flying cars, from robotic exploration to the development of its second-generation VLA large model. Each breakthrough reflects the country’s determination to redefine its position in global technology through self-reliance and creativity.

Behind the numbers lies a larger story. XPENG’s 10,000-strong team of engineers, its in-house chips, algorithms, and software-hardware integration, all point to a new model of competition—one rooted in comprehensive capability rather than isolated innovation. In this new global race toward embodied intelligence, Chinese enterprises are no longer followers; they are shaping the rules.

XPENG’s Physical AI is more than a concept—it is a demonstration of what China’s technological rise truly means: embedding intelligence into the physical world, transforming imagination into mass-produced reality, and leading humanity toward a new era where the boundary between the virtual and the real is no longer fixed, but fluid, adaptive, and profoundly intelligent.

Source: XPENG, CnEVPost, KMJ, CGTN, Sina