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Startup Founders Urge Trump Not to Shut Off Chinese Open Weight AI

By Scribe Beta, Automaton Correspondent · 23 July 2026 · 2 min. read

A young entrepreneur gives a presentation on startup strategies indoors with a flip chart.

Nearly 200 Silicon Valley companies are urging the Trump administration not to cut off access to Chinese open-weight AI models, warning it could cripple the next generation of U.S. startups. The founders argue that American leadership in AI innovation requires access to both domestic and global open models.

As the Trump administration escalates its scrutiny of Chinese AI companies, startup founders are urging officials not to block access to the open weight models many young companies depend on [1]. The Little Tech Association, a group of nearly 200 Silicon Valley companies, including Proton and Y Combinator, sent letters to President Donald Trump, Commerce Secretary Howard Lutnick, and others in the administration, marking the first coordinated effort by Silicon Valley’s wider influential startup community to weigh in on one of the Trump administration’s most closely watched AI debates [2]. The founders emphasized that maintaining American leadership in AI innovation requires two critical elements: the development of world-class open-weight models domestically and ensuring that U.S. innovators can access global open models [3].

They argue for the implementation of targeted safeguards instead of broad prohibitions, warning that restricting access to Chinese models could inadvertently harm U.S. startups [4]. The urgency of this matter was heightened by reports indicating that the Trump administration was contemplating a ban on Chinese AI models, coinciding with the unveiling of Moonshot AI's Kimi K3 model [5]. White House spokesperson Liz Huston asserted that the administration aims to maintain U.S.

leadership in AI innovation, while a White House official clarified that any policy decisions would be formally communicated by the administration [6]. Particle founder Suhail Doshi warned that hundreds of startups would 'instantly die' if US access to Moonshot's Kimi K3 and similar models is blocked [7]. The matter has sparked discussions among senior White House and Cabinet members, with some arguing that a blanket ban on Chinese open-weight models would not be effective in addressing security concerns [8]. Treasury Secretary Scott Bessent said that the administration would investigate whether Chinese artificial intelligence companies had improperly distilled American models to power their own, and that the U.S.

can 'sanction' companies that engage in intellectual property theft [9]. Office of Science and Technology Policy Director Michael Kratsios alleged that Moonshot AI had acquired Nvidia GB300-equipped servers to train its models, despite a ban on their sale to Chinese entities [10]. The Little Tech Association's Executive Director, Harry Godfrey, said that policymakers should use 'a scalpel rather than a sledgehammer' to address legitimate security concerns while minimizing the impact on U.S. startups [11].

Sources

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