White House Says Moonshot AI Distilled Claude, Misused GB300 Chips

AI distillation, in which developers train a model using outputs from a more capable system, can lower costs and broaden access to advanced technology. US officials have distinguished legitimate distillation that supports an open AI ecosystem from covert, large-scale extraction of proprietary capabilities. The issue carries added weight as Washington seeks to prevent Chinese companies from obtaining cutting-edge AI models and restricted NVIDIA processors through overseas channels.

A White House official accused Moonshot AI of using a sophisticated platform to distill Anthropic’s Claude Fable at scale while developing Kimi K3. The Chinese startup was also alleged to have trained the model in Thailand using NVIDIA GB300 chips in breach of US restrictions. As of July 23, 2026, the report had not identified the official or disclosed the number of processors, the scale of the training operation or any financial amount involved.