White House AI and Crypto Czar David Sacks on Friday, July 25, 2026, publicly backed US Commerce Secretary Howard Lutnick's position on American artificial intelligence dominance, arguing that fears over Chinese AI challenger Kimi are overblown and that frontier US models remain decisively ahead of global competition.

Context

Sacks posted on X that what he called the 'Kimi Panic' — a wave of concern in US technology circles over the cost-efficiency of Moonshot AI's Kimi chatbot — needs to stop. He cited analysis by Ben Thompson, founder of the technology strategy publication Stratechery, who argued that Kimi's apparent cost advantage largely disappears once higher token usage and the real infrastructure costs of running a model of that scale are factored in. 'Open weights still require expensive infrastructure,' Sacks wrote.

Moonshot AI is a Beijing-based company that has positioned Kimi as a lower-cost frontier model, drawing comparisons to US labs and sparking debate in Silicon Valley about whether Chinese AI is closing the capability and cost gap faster than expected.

Policy Backdrop

Sacks's post is a direct defence of the Trump administration's deregulatory posture on AI. 'President Trump's light-touch regulatory approach is working,' he wrote, adding that the US will continue to win 'as long as we don't sabotage ourselves with unnecessary rules.' This framing echoes the administration's sustained effort to roll back the reporting requirements and safety standards introduced under the previous administration's October 2023 executive order on AI.

The Trump White House has consistently treated AI as a national competitiveness priority, with Sacks's role as AI and Crypto Czar designed to coordinate policy across agencies and signal to the private sector that Washington will not impose heavy compliance burdens. The administration's position draws a direct line between deregulation and American technological leadership.

Stakeholders and Impact

Anthropic and OpenAI are at the centre of Sacks's argument. He stated that both companies are 'growing revenue at rates that Silicon Valley has never seen before at this scale,' describing commercial traction as 'the clearest test of who is winning the market.' Anthropic, backed by Amazon and Google, and OpenAI, which counts Microsoft as a major investor, have both reported rapid enterprise adoption in recent quarters.

For Indian enterprises and technology investors, the US-China AI race carries direct implications: American frontier model APIs underpin a large share of India's fast-growing AI startup ecosystem, and any shift in the competitive balance — or in US export-control policy — would affect access to cutting-edge models and cloud infrastructure.

What's Next

Sacks's call to 'let our horses run' signals that the administration will resist congressional proposals to reintroduce mandatory AI safety rules or expand export controls on advanced chips in ways that could slow domestic development. Upcoming releases of next-generation models from US labs will be closely watched as practical tests of whether the capability gap Sacks describes holds.

Any move in Congress to legislate AI safety standards — or to tighten semiconductor export controls — will now face this public benchmark: whether it risks, in the administration's framing, the US 'sabotaging itself' in the race against Chinese AI.