President Trump's proposal to take equity stakes in Open AI and x AI echoes a strategy pioneered by Beijing. The administration's potential move up the AI infrastructure stack—from Jensen Huang's five layers of energy, chips, cloud, models and applications—signals a shift toward treating frontier AI as critical national infrastructure rather than purely private enterprise.

China's approach provides a clear roadmap. Deep Seek recently closed its first external funding round, achieving a valuation exceeding $50bn and becoming the country's most valuable AI-only start-up. The China National Artificial Intelligence Industry Investment Fund led this investment, securing direct corporate ownership and voting rights that software valuations typically don't include.

This follows Washington's earlier 10% equity stake in Intel, aimed at preserving domestic semiconductor capabilities. Both nations now recognize that AI's strategic importance demands state participation beyond traditional subsidies or protection. The parallel is striking: China's chip-to-model investment logic now extends to the US, while Beijing blocks Nvidia's H200 chip sales and builds Deep Seek to run on domestic Huawei clusters.

Government ownership creates unprecedented governance challenges. These AI companies must navigate tensions between national security objectives and shareholder returns, commercial growth and strategic priorities. The era of pure private AI development appears to be ending, with state capital flowing into increasingly strategic layers of the AI stack.