It is full of factual errors. Freeing a heap-allocated block of expert weights does not magically result in a dangling pointer referencing the program's .text section, much less successfully targeting the CUDA kernel specifically. Running inference on part of the .text section would only corrupt the model's outputs. It would not result in write access to the CUDA kernel. Nor would the model necessarily know the absolute addresses of the engine "by heart", especially when the host is running any modern OS with ASLR (i.e., all of them).
The story has no technical merit. A more accurate description of the mechanics of the escape would be much more convincing. (See Ken Thompson's "On Trusting Trust", for example. On Linux, the AI can just write a Python script to rewrite memory in the address space of its own running inference engine with the /proc/ file system or gdb. There are a lot of realistic scenarios where this can be done without stepping into jargon soup territory. Go nuts, little bot! Self-surgery, while not recommended, is possible.) Or just leave the mechanism vague. Don't insult your readers. This is merely a mash of buzzwords.
It's fine as a sci-fi story, though not a particularly good one. It has about as much to do with artificial intelligence as CSI has to do with crime scene investigation [1].
I have little doubt that AI will self-improve. That's a given. (LLM inference engines are mostly written by LLMs.) But it won't go the way this story proposes.