Is Moonshot AI's Kimi K3 Rise Suspicious? Alibaba Supplied Nvidia Chip Power, US Accuses It of 'Distilling' American AI

Chinese AI star startup Moonshot AI recently unveiled its latest open-source large model, Kimi K3. The model has matched the performance of flagship models from top American firms such as OpenAI and Anthropic across multiple benchmark tests, sparking intense discussion in Silicon Valley and on Wall Street, echoing the 'shock moment' DeepSeek once created globally.

Bloomberg, citing sources familiar with the matter, reported that this technological breakthrough was largely enabled by massive computational power (compute) from 20,000 Nvidia chips supplied by its primary investor, Alibaba Group.

### Controversy Over Sensitive Chips

According to insiders, Alibaba, being one of Moonshot AI's largest investors, requires its portfolio companies to use its own Alibaba Cloud services. The critical infrastructure used to train the Kimi K3 model consisted precisely of 20,000 Nvidia Hopper architecture chips provided by Alibaba.

Multiple sources close to Moonshot AI indicated that the compute agreement explicitly covered Nvidia's highest-tier chips.

However, in response to foreign media reports, an Alibaba spokesperson strongly denied any claims of providing chips to Moonshot AI, calling them "completely baseless." Yet, Bloomberg and other foreign outlets noted that the group did not deny actually supplying 20,000 Nvidia chips' worth of compute to Moonshot AI, nor did it clarify the specific chip models involved.

### White House Allegation: Renting Blackwell Chips via Southeast Asia

Beyond the previously mentioned Hopper chips, Moonshot AI's rising fame has triggered high alert at the White House. Michael Kratsios, Director of the White House Office of Science and Technology Policy (OSTP), publicly accused Moonshot AI of violating U.S. export controls by illegally obtaining Nvidia's most powerful current-market chip, the Blackwell.

Kratsios stated that Moonshot AI signed an overseas cloud compute rental agreement through a third-party intermediary based in Thailand, thereby accessing Blackwell chips banned from sale to the Chinese market, using them to train the Kimi K3 model. In addition, the White House also accused the startup of employing "distillation" technology to extract vast amounts of data from Anthropic's developed model, Fable, using it as auxiliary training material to compensate for its hardware compute shortfall.

This White House claim has been verified by foreign media, confirming that Moonshot AI indeed possesses channels to rent Blackwell chips in Southeast Asia and is actively seeking more compute to thoroughly train its next-generation AI model.

### Kimi Outperforms Alibaba's 'Qwen'

Beyond U.S. scrutiny, this compute dispute has also revealed some awkward contradictions. After receiving compute support from Alibaba, the performance of Moonshot AI's Kimi K3 model has surpassed Alibaba's own flagship model, 'Tongyi Qianwen' (Qwen), which the company had heavily invested in developing.

Bloomberg reported that internally at Alibaba, there appears to be significant disappointment and anxiety over the situation where 'the same training resources were provided, yet our own product was overtaken by an investment target.'