Startup Founders Urge Trump Not to Ban Chinese Open-Weight AI

Nearly 200 Silicon Valley startups — including Proton and Y Combinator — warn the White House that cutting off access to Chinese open-weight AI models would cripple American innovation and kill hundreds of companies overnight.

Nearly 200 Silicon Valley companies — including Proton and Y Combinator — have urged the Trump administration not to cut off access to Chinese open-weight artificial intelligence models, warning the move would cripple US startups that depend on them.

The newly formed Little Tech Association sent letters to President Trump, Commerce Secretary Howard Lutnick, and other administration officials on Wednesday, marking the first coordinated pushback from the startup community against a potential ban.

"American leadership requires two things: world-leading American open-weight models and continued access for U.S. builders to open models already available worldwide," the founders wrote.

The matter took on urgency after reports that the Trump administration was weighing a ban on Chinese AI models, following Moonshot AI's unveiling of its powerful Kimi K3 model. Treasury Secretary Scott Bessent said Tuesday the administration would investigate whether Chinese AI companies had improperly distilled US models.

Michael Kratsios, the administration's AI lead, alleged Moonshot AI built "a sophisticated internal platform" to distill Anthropic's Fable model while developing K3. Moonshot has not publicly addressed the allegation.

"There'll be hundreds of companies that instantly die," said Suhail Doshi, founder of AI infrastructure startup Particle, if American developers lose access to Chinese open-weight models.

The pushback reveals a deepening divide inside the AI industry. Heavyweights like Anthropic increasingly urge tighter restrictions on Chinese AI development, while startups argue that open-weight models — regardless of origin — are essential infrastructure for American innovation.

Harry Godfrey, executive director of the Little Tech Association, called for "a scalpel rather than a sledgehammer" and urged the administration to find "the lightest-touch way that doesn't raise costs, limit access, or inhibit American innovation while still addressing" legitimate security concerns.

A White House official granted anonymity to discuss internal deliberations said any policy announcement would come directly from the administration.

Sources: Politico, Hacker News