Chinese startup Moonshot, which recently unveiled its high-performance artificial intelligence (AI) model "Kimi K3," is reportedly under a contract with Alibaba to use around 20,000 Nvidia chips.

According to Bloomberg on the 2nd local time, multiple anonymous sources recently stated that Moonshot and Alibaba have entered into such a computing power contract, and that a significant portion of the computing power used by Moonshot for its Kimi models is provided through this agreement.

Bloomberg evaluated that although China advocates for semiconductor self-reliance, it still relies on U.S. semiconductors for AI development.

Sources explained that Alibaba is one of Moonshot's major investors and wants the companies it invests in to use its cloud services.

Because Alibaba also owns its own AI model, Qwen, the two companies are competitors as well. One source noted that this has led to some voices of disappointment within Alibaba regarding Moonshot's use of Alibaba's infrastructure.

Kimi K3 is one of the world's largest open-weight AI models, featuring 2.8 trillion parameters. Moonshot claims that Kimi K3 outperforms Qwen in certain key metrics and exhibits performance close to top-tier U.S. models.

Kimi K3 has drawn attention from the U.S. industry and authorities given that a Chinese company developed a competitive AI model despite U.S. advanced semiconductor export controls.

Debates have also emerged over whether the massive funds poured into data centers by U.S. AI companies are proportional to performance improvements.

Michael Kratsios, Director of the White House Office of Science and Technology Policy (OSTP), recently claimed that Moonshot accessed Nvidia Blackwell chips through a third party in Thailand via a computing power lease agreement and used them to train Kimi K3.

Such lease agreements are generally permitted by U.S. authorities.

While one source mentioned that Moonshot has a channel to access Blackwell through Southeast Asia, they declined to comment on its legality.

Bloomberg reported that Alibaba denied speculations that the 20,000 Nvidia chips provided to Moonshot were H200s, calling them "completely baseless," but did not deny the fact that Nvidia chips were provided to Moonshot.

Moonshot and Nvidia declined to comment on Bloomberg's request for comment.

(Photo: AP, Yonhap News)