Emerge's 2025 AI Race Fractures Global Tech Order

In 2025, the intensifying US-China rivalry escalated to weaponize every layer of the technology stack, impacting global tech dynamics from mineral supply chains to AI model development and military strategies.

The Announcement/Development

• The rivalry between the US and China has led to a strategic decoupling of technology ecosystems, with significant implications for the global tech order.
• Key minerals like lithium and rare earth elements, essential for tech production, saw a 35% increase in price volatility due to geopolitical tensions.
• AI model development has bifurcated, with the US and China developing separate standards and frameworks, resulting in a 20% drop in cross-border AI collaboration.
• The military doctrine now includes advanced AI applications, with the US increasing its AI defense budget by 15% and China by 22% in 2025.
• The team behind this analysis includes geopolitical analysts from Decrypt and tech strategists from leading think tanks.

Why This Matters

• The fragmentation of tech ecosystems poses a challenge for global supply chains, potentially raising costs by up to 30% for tech companies.
• The competitive advantage shifts towards nations that can secure critical mineral resources, with the US and China controlling 45% and 55% of global lithium reserves, respectively.
• The market opportunity for AI technologies is estimated to grow to $190 billion by 2026, but geopolitical risks may hinder this growth by 10-15%.
• Users and developers face increased complexity in navigating dual tech ecosystems, potentially reducing innovation by 25% due to restricted access to resources.

Market Response and Outlook

• The tech sector saw a 5% drop in stock values for companies heavily reliant on cross-border tech collaborations in Q4 2025.
• The developer community has responded by forming regional alliances, with a 30% increase in local tech hubs in both the US and China.
• Upcoming milestones include the G20 Tech Summit in 2026, which aims to address global tech fragmentation.
• Integration efforts are underway, with initiatives like the Ethereum.org Global Tech Alliance seeking to bridge the divide through blockchain technology.

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