SerpApi.Org
China’s new AI model, Kimi K3, has been making waves as the latest threat to US dominance in artificial intelligence. But according to the White House, the Chinese model is merely an unauthorized knock-off based on US tech.
On Wednesday, Michael Kratsios, director of the White House Office of Science and Technology Policy, claimed that Kimi K3’s developer, the Chinese startup Moonshot AI, created the model by effectively cheating and cloning the capabilities of Anthropic’s cutting-edge Fable model.
“We have information that Moonshot AI distilled Anthropic’s Fable for the development of its K3 model,” Kratsios tweeted. “To do this, they developed a sophisticated internal platform to conduct large-scale distillation against US models, allowing them to quickly switch between multiple methods of access to avoid detection.”
Distillation usually refers to training a smaller AI model to mimic the performance of a larger one. But Chinese companies have allegedly been using that process to extract and clone capabilities from top-performing US models. In February, Anthropic accused Moonshot, DeepSeek, and MiniMax—all Chinese firms—of using distillation to uncover the reasoning and coding capabilities of its Claude chatbot. In Moonshot’s case, the Chinese startup allegedly used hundreds of fake accounts involved in 3.4 million exchanges with Anthropic’s chatbot.
Kratsios didn’t elaborate on Moonshot’s alleged distillation to create Kimi K3. But he also accused the Chinese startup of sourcing cutting-edge Nvidia Blackwell GPUs from Thailand, thus bypassing US export controls on the technology.
Distillation isn’t exactly illegal, though. Nor was any evidence given. Others are skeptical because Anthropic's Fable was only released a week before Kimi K3. Still, Kratsios appears to be setting the stage for a White House crackdown on Chinese AI models over national security concerns. "Large-scale, covert industrial distillation aimed at stealing proprietary US technology and undermining American research is unacceptable," he tweeted.
Anthropic's Head of Public Policy, Sarah Heck, also chimed in, tweeting: "Illicit, adversarial distillation is IP theft and industrial espionage that supports adversary military and intelligence capabilities. It is a national challenge that creates serious national security risks for the United States and democratic allies."
According to Axios, the Trump administration is considering banning US companies from hosting Chinese models unless their security can be guaranteed. Treasury Secretary Scott Bessent also publicly said this week: “If we see, especially that overseas models are stealing from our great companies, we have the ability to sanction them because of this theft.”
Moonshot AI didn’t immediately respond to a request for comment. But the arrival of Kimi K3 has also set off a debate about the US’s closed-source approach to AI versus China, which has been pursuing open-weight AI models that can cost less to use.
Tech investor Chamath Palihapitiya tweeted his own criticism, writing: "Tricking the US Government to protect frontier labs’ business model by using a China boogeyman is a mistake. It is protecting the equity of 5,000 people who are investors in [OpenAI] and [Anthropic] at the sale of everyone else. This would be a terribly stupid decision. Let the market sort this out!"
