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White House adviser alleges Moonshot AI used distillation to copy US tech
The adviser said Moonshot AI also accessed restricted Nvidia servers for training, amid wider US scrutiny of potential IP theft via distillation.
A White House science and technology adviser accused China’s Moonshot AI of mounting a large scale effort to steal capabilities from leading US AI models, using a technique known as distillation. According to BBC Business, Michael Kratsios said Moonshot used distillation, where a weaker model extracts answers from a stronger one, and that the company gained access to restricted cutting edge Nvidia servers to train its models. He also claimed the US has information that Moonshot distilled capabilities from Anthropic’s Fable AI for its K3 model, which drew global attention after it was unveiled last week.
The allegations come as the US ramps up scrutiny of Chinese AI systems, including a potential review directed by the Treasury Department. BBC Business also noted that Treasury Secretary Scott Bessent said the US will examine whether Chinese AI models have stolen capabilities from American rivals and that sanctions could be considered if Chinese firms cross the line into IP theft through what he called industrial scale distillation attacks.
Kratsios’ comments reference prior US export restrictions on Nvidia’s most advanced chips, imposed in 2022 over concerns they could be used by the Chinese military, alongside subsequent enforcement efforts against chip smuggling. The BBC said it has reached out to Moonshot, the Chinese embassy in Washington, Anthropic, the White House, and Nvidia for comment, and that Moonshot plans to release Kimi K3 as an open source model on 27 July.