President Xi Jinping has called for China to play a larger role in shaping global artificial intelligence rules as Chinese AI models gain significant traction among American companies. Speaking at the World AI Conference in Shanghai, Xi emphasized that AI should remain controllable by humans while urging countries to cooperate on safety, technical standards and access for developing economies. He also promoted the World AI Cooperation Organization, a newly established group of nearly 30 countries that could give Beijing greater influence over global AI governance. China's growing position is already visible on OpenRouter, a widely watched model marketplace, where Chinese systems accounted for 63% of U.S. companies' token usage during the first week of July, compared with less than 10% a year earlier.
The expansion of Chinese AI is also putting pressure on established technology companies and investor sentiment across the sector. Moonshot, a Chinese AI startup, introduced its Kimi K3 model shortly before Xi's speech and said the system could compete with the strongest offerings from OpenAI, an artificial intelligence developer, and Anthropic, an AI company whose advanced models have attracted U.S. national-security scrutiny. The announcement sent AI and semiconductor stocks sharply lower as investors compared the market reaction with last year's DeepSeek moment. DeepSeek has recently become the most popular Chinese model among American companies on OpenRouter, while Lindy AI, an AI-assistant startup, said its move from Anthropic's models to DeepSeek reduced inference costs by 90%.
The rapid adoption of these lower-cost models may now face increasing regulatory risk in both China and the United States. Chinese officials have discussed security concerns with Alibaba Group Holding NYSE:BABA, the developer of the Qwen model family, and have considered restricting overseas access to the country's most capable systems, although the discussions remain preliminary and no enforcement is currently planned. U.S. lawmakers have separately opened investigations into Airbnb, a home-sharing company, and Anysphere, the developer of coding platform Cursor, over their use of Chinese models, while Palantir Technologies NASDAQ:PLTR, a U.S. technology company, has described Chinese open models as an economic threat. Investors may therefore view China's open-weight strategy as both a competitive challenge for Western AI developers and a source of potential disruption if tighter controls fragment global research networks or reduce access to lower-cost technology.