After Moonshot's Kimi K3 spurred multi-vector allegations of model distillation, China's AI labs are apparently becoming a lot more sensitive to this issue, with TikTok owner ByteDance becoming the second such AI lab to explicitly ban distillation from US models. Meanwhile, Anthropic has just confirmed that it's working on a dedicated ASIC for Claude, potentially extending its inference-related economies of scale.

For the benefit of those who might not be aware, Moonshot's Kimi K3 model jumped right into the ongoing multi-dimensional struggle between China and the US back in July, when Anthropic and some members of the Trump administration levelled accusations that Moonshot distilled the Kimi K3 model from Anthropic's Fable.

Apparently, as per the specific allegations leveled by a Trump administration official recently, Moonshot not only furtively owns some NVIDIA GB300 servers, but was also able to access additional GB300 GPUs via Thailand.

Do note that the proclivity of China's AI labs to distill frontier US models is raising hackles within the Trump administration, especially given the fact that there is no easy way of preventing this. After all, Chinese engineers often take their model-laden hard drives to US-friendly countries to imbue their models with frontier-level capabilities by using reinforcement learning techniques on cutting-edge NVIDIA GPUs.

This brings us to the core topic. The Information is now reporting that ByteDance has explicitly banned its employees from distilling US models amid fears of triggering a damaging retaliation from Washington that might endanger the company's prized TikTok social media platform, with the company's founder, Zhang Yiming, reportedly declaring:

"We should be willing to sacrifice some short-term gains for longer-term goals."

This follows similar action elsewhere, with Alibaba going so far as to revoke access to Anthropic's Claude for its employees to ease any lingering distillation fears vis-à-vis its Qwen model.

Meanwhile, we reported back in May that Anthropic's passing remarks on "logic chips" in relation to its evolving partnership with Samsung had unleashed a flood of speculation regarding a possible ASIC-related tie-up between the two.

Well just around two months later, Anthropic has all but confirmed to Business Insider that it indeed plans to build such a custom chip by acknowledging its ongoing efforts to assemble an in-house silicon design team , going on to add that Anthropic has taken and will continue to take a "multi-chip approach."

This comes as OpenAI unveiled its own ASIC back in June. Dubbed Jalapeño , the custom chip has been designed in collaboration with Broadcom, and is expected to undergo mass deployment by the end of 2026.

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