Why new model of China’s Moonshot AI stirs ‘DeepSeek moment’ debate

Beijing-based Moonshot AI, a start-up valued at US$3.3 billion and backed by Chinese tech giants like Alibaba Group Holding and Tencent Holdings, has presented another David-vs-Goliath story after creating an open-source model that “set new records across benchmarks that assess reasoning, coding and agent capabilities”.

The new reasoning model, Kimi K2 Thinking, was the most popular model for developers on Hugging Face as of Monday, while its release post on X had attracted 4.5 million views. The popularity of the model – a variant of the Kimi K2 model – had further grown after CNBC reported its training cost was merely US$4.6 million. Moonshot AI did not comment on the cost.

Even without factoring in its costs, the latest model has impressed the AI community. Thomas Wolf, co-founder of Hugging Face, commented on X that Kimi K2 Thinking was another case of an open-source model passing a closed-source model.

Training costs of Chinese AI models are seeing a “cliff-like drop”, according to an analyst. Photo: Shutterstock

“Is this another DeepSeek moment?” Wolf asked. He was referring to the launch of the low-cost but high-efficient R1 reasoning model by the Hangzhou-based Chinese AI start-up earlier this year that had shaken the perception of absolute American AI supremacy. “Should we expect [one] every couple of months now?”

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