Being Second Best In the AGI Race Just Got Way Cheaper

Kimi K3 release was special.Last week, on July 16th Kimi K3 was released by the Chinese company Moonshot AI. It took the AI world by a storm, and rightfully so. The model pushed the frontier of open-weight models (the weights have not been published as of July 26th 2026, they are scheduled to be released on July 27th), almost matching other SOTA models, while being available at a significantly lower cost than Fable 5. All of this was achieved among accusations of using a method that gathered a lot of attention recently - distillation. While not officially disclosed, there are several cues for Kimi K3 being trained on outputs of Claude including K3 identifying itself as Claude 15% of time. People have gone on to compare the similarity of answers to the same prompts across models and have seen similar results. White House OSTP Director accused Moonshot AI of distilling Kimi K3 from Fable 5 , but did not provide any proof to the public. Back in February 2026 Anthropic claimed that…