Chinese AI firms that rip off US models could face sanctions, Treasury Secretary Scott Bessent warns

US Treasury Secretary Scott Bessent warned that the Trump administration will sanction Chinese AI firms caught using unauthorised distillation to build models from US labs' proprietary work, citing evidence of US-made AI watermarks in Chinese models. The administration is also considering requiring US firms using Chinese models to disclose this, as Moonshot's Kimi K3 and other Chinese open-source models gain traction.

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