OpenAI says people linked to Moonshot AI, the Chinese developer of Kimi, were behind a coordinated campaign to extract the hidden reasoning of its models. The company set out its findings in a blog post on Wednesday.
The activity began on 1 July at low volume. It spiked on 24 and 25 July, with 16,000 requests from more than 4,000 users. OpenAI then found related activity across more than 15,000 users. It says it fully shut the campaign down by 28 July. It could not tie every operator to one actor, but it attributes “a core cluster” to people associated with Moonshot.
“This activity is consistent with adversarial distillation: the systematic and unauthorized use of one model’s outputs or reasoning to help train, reproduce, or improve another model,” OpenAI wrote.
How the extraction worked
OpenAI hides the reasoning its models go through before they answer. The operators copied that encrypted reasoning from one conversation, the company said. They then asked a model in another conversation to decrypt and transcribe it.
They did not break its encryption, get into a database or reach stored user conversations, OpenAI added. It has since banned accounts, tightened sign-up checks and added protections for hidden reasoning. It also shared its findings with other AI labs through the Frontier Model Forum and with government channels.
“Our concern is about violation of our terms of service, not open models or legitimate distillation,” Caroline Zier, who leads strategic national security policy initiatives at OpenAI, told Bloomberg.
Accusations and pushback
This is the first time OpenAI has accused Moonshot, Bloomberg reported. Anthropic made a similar claim against the company in a report last month, Bloomberg noted.
US agencies have made the same charge. An advisory this month named six Chinese firms and the US models each one targeted. China rejected the advisory as unfounded accusations.
Not everyone accepts the claims. David Sacks, Trump’s former AI czar, has called such reports a push to get the US to ban rival open models, Bloomberg reported.
Moonshot also faces scrutiny at home. Chinese regulators are investigating DeepSeek and Moonshot, The Information reported this month.
