A U.S. Ban on Investing in Chinese AI Startups Could Escalate Under Trump

Late last month, the US Treasury Department finalized new restrictions limiting what kinds of Chinese tech startups US venture capital firms can invest in for national security reasons. When they go into effect in January, the long-awaited measures will stop American VCs and other investors from pouring money into cutting-edge Chinese AI models. After president-elect Trump takes office a few weeks later, his administration may expand the rules and make them even tougher.

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Emily Kilcrease, a senior fellow at the think tank Center for a New American Security, says that the Treasury Department’s 10²⁵ flops threshold will be easier for the US government to enforce than the blanket ban on all investments in AI systems with military applications. “Given AI is fundamentally dual-use, I always view [end use restrictions] as fundamentally unworkable,” she says. “They’re kind of a complement to what I actually think are the more workable restrictions based on the computing power of the AI model.”

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