Sacks warns US risks losing AI edge after new Chinese model launch

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Sacks warns US risks losing AI edge after new Chinese model launch

Former White House AI and cryptocurrency czar David Sacks argued Friday that the U.S. is “tying itself in knots” over AI and risking its competitive edge, following the release of a new Chinese model.

© AP Photo/Ben Curtis

Kimi K3, a new model from the Chinese startup Moonshot AI, sent shockwaves through the American AI industry Thursday after its developers claimed it could perform on par with Anthropic and OpenAI’s leading models.

The AI evaluator Arena also bumped Kimi to the top of its rankings for front-end coding, prompting Sacks to describe the development as “concerning.”

“Meanwhile America is tying itself in knots: politicians and bureaucrats are banning new data centers, piling on state regulations, and pushing for new federal agencies to pre-approve frontier models,” the venture capitalist wrote in a post on X.

“This is how you lose the AI race,” he continued. “The rest of the world won’t play by our rules if we bog ourselves down. Permissionless innovation is how America won the internet and became the technological envy of the world. We can do it again with AI — while addressing risks in a targeted way — or we’ll watch our lead evaporate.”

Read more in a full report at TheHill.com.

Welcome to The Hill’s Technology newsletter, we’re Julia Shapero and Miranda Nazzaro — tracking the latest moves from Capitol Hill to Silicon Valley.

Essential Reads

How policy will be impacting the tech sector now and in the future:

Senate Republicans block Dem attempt to end AI prior authorization in Medicare

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China dismisses ‘groundless’ Trump election interference claim

China denied President Trump’s accusation that it interfered with the 2020 presidential election, calling the claim “entirely fabricated” and “groundless” while insisting it never had any interest in meddling with U.S. elections. Speaking at a press conference on Friday, Chinese Foreign Ministry spokesperson Lin Jian responded to Trump’s Thursday primetime address, when the president accused Beijing of infiltrating voter rolls …

China’s Xi calls for more global efforts to guide AI, chides US for its curbs on tech sharing

SHANGHAI (AP) — Development and governance of artificial intelligence should be a global effort, Chinese President Xi Jinping said Friday, while reiterating China’s objections to what he called the “overstretching” of national security concerns. Speaking at a conference in Shanghai, Xi said AI should not be dominated by any single nation. American-led restrictions have blocked China from accessing some of the world’s …

The Refresh

News we’ve flagged from the intersection of tech and other topics:

Meta in talks to lease computing power to Anthropic in potential $10 billion deal (New York Times)

Apple, Nvidia vie for title of world’s most valuable company (CNBC)

Crypto Corner

Warren seeks more financial disclosures from Trump

© Natasha Kaiser

Sen. Elizabeth Warren (Mass.), the top Democrat on the Senate Banking Committee, asked President Trump on Thursday to release financial disclosures covering his cryptocurrency earnings through the first half of this year.

In a letter to the president, she requested updated disclosures that include information up until July 15, 2026.

“Doing so will provide Congress with the information it needs to effectively address governmental ethics concerns as it considers crypto market structure legislation that, without adequate guardrails, would turbocharge your significant conflicts of interest and almost certainly boost the value of your and your family’s crypto holdings,” she wrote.

Trump’s financial disclosures, released late last month, showed he made more than $1 billion in crypto-related income in 2025.

This has once again thrown a wrench in efforts to negotiate the Clarity Act, a crypto regulation bill.

A key source of disagreement has been ethics. Democrats have pushed for a provision that would limit elected officials, including the president, from profiting off the industry.

Crypto Corner is a daily feature focused on digital currency and its outlook in Washington.

In Other News

Branch out with other reads on The Hill:

Wall Street traders can soon pay for early looks at Truth Social posts

President Trump’s social media platform announced plans Thursday to sell Wall Street firms early access to its “most market-moving” posts. Trump Media & Technology Group (TMTG), the parent company of Truth Social, said it would launch “Truth API” — a direct data feed that would give investment firms “real-time access to posts from the highest-ranking Truth Social accounts.” Trump launched Truth Social in February …

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