China's AI models, exemplified by the free and open-source Kimi, are creating internal conflict among Donald Trump's AI advisors. The emergence of powerful, low-cost Chinese AI threatens the business models of US companies like OpenAI and Anthropic, leading to a divide within Trump's orbit regarding how to respond.

Former Trump advisor David Sacks criticized top AI firms for seeking government protection from open-source competition, advocating for a more open AI landscape. Conversely, others within the administration, like Emil Michael, favor government intervention to control AI development due to national security concerns. This disagreement highlights a broader debate on whether the government should protect AI companies or foster open competition.

The situation is further complicated by the US government's past efforts to curb China's access to advanced chips and the practice of "distillation," where Chinese models are trained on existing AI outputs. Despite these measures, the release of models like Kimi, which rivals US-developed AI, presents a significant economic and political challenge for a potential Trump administration, leaving advisors fractured on a unified strategy.