US alleges Chinese AI firm Moonshot stole from Anthropic’s Fable for latest Kimi K3 model

China’s Moonshot AI stole from Anthropic’s most sophisticated AI large language model, Fable, to help create its latest K3 release, top White House tech official Michael Kratsios has alleged.

“We have information that Moonshot AI distilled Anthropic’s Fable for the development of its K3 model,” he claimed in a post on X on Wednesday.

“Large-scale, covert industrial distillation aimed at stealing proprietary US technology and undermining American research is unacceptable.”

In April, the US State Department ordered a global push to bring attention to what it says are widespread efforts by Chinese companies, including Moonshot AI, to steal intellectual property from US artificial intelligence labs, according to a diplomatic cable seen by Reuters news agency.

Distillation is the process of training smaller AI models using output from larger, more expensive ones as part of an effort to lower the costs of training a powerful new AI tool.

Chinese AI startup Moonshot on Friday unveiled Kimi K3, a 2.8 trillion-parametre model that it said is the world’s largest open-weight AI system and delivers performance approaching US giant Anthropic’s frontier Fable model.

The launch, which comes a month after Anthropic’s Fable and Mythos models were abruptly withdrawn by the US government due to security concerns, underscores how quickly China’s open AI ecosystem is narrowing the gap with the most advanced US systems.