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It takes time for your bad consequences to catch up with you. Since the idea is clearly horseshit, I doubt the CEO put a large amount of his money on the line. It will take him some time to piss through the investor money and then you will see a sad “goodbye” message from Rabbit Inc. as they brick the devices on the way out. (since it does nothing without their server)
The US is so inept at manufacturing, yet wants to fight China. We can pretend to punish them, but 98% of all products bought and sold in the USA are “Made In China”.