Moonshot AI is reported to have distilled Anthropic’s Fable model to develop its own K3 model. This process involved a sophisticated internal platform designed for large-scale distillation against U.S. models, enabling rapid switching between access methods to evade detection.

Furthermore, Moonshot AI has reportedly acquired servers equipped with GB300 GPUs and accessed them in Thailand, presumably for AI model training. This development occurs amidst the U.S. government's stance on AI development, which champions open innovation and competition across various AI domains.

While the U.S. supports legitimate AI distillation for creating efficient models, it condemns large-scale, covert industrial distillation intended to steal proprietary technology and hinder American research. The actions of Moonshot AI, if confirmed, would fall into the latter category, raising concerns about intellectual property and fair competition.