The White House has publicly accused Chinese AI startup Moonshot AI of stealing proprietary technology from Anthropic's Fable model to build its Kimi K3 system, escalating the US-China technology feud to dangerous new heights. Trump's tech adviser described the alleged theft as an "industrial-scale distillation attack" that crosses the line into outright intellectual property violation.
The Treasury Department is now threatening sanctions and Entity List designations against Chinese AI firms, according to Nikkei Asia. Beijing fired back on Wednesday, insisting its AI advances stem from "greater self-reliance and strength" and dismissing Washington's claims as baseless. The diplomatic row threatens to derail what little remains of US-China cooperation on AI safety governance, a framework both nations previously acknowledged was essential to preventing catastrophic risks. [1]
Experts warn the rupture could fragment global standards for AI development precisely when unified oversight is needed most. With Moonshot's Kimi K3 already deployed across millions of devices in China, the episode has become a flashpoint testing whether national security anxieties or shared safety imperatives will shape the future of artificial intelligence.