China's Moonshot AI Pauses Subscriptions for New Kimi K3 Model Amidst Surging Demand

Chinese artificial intelligence firm Moonshot has temporarily halted new subscriptions for its recently launched Kimi K3 model due to overwhelming demand. The company announced Sunday that it is experiencing "unprecedented compute challenges" and will prioritize serving its existing paid users.

The Kimi K3 model, trained on 2.8 trillion parameters, is reportedly the largest open-source model ever released. Moonshot stated on social media that demand in the preceding 48 hours had pushed its resources to the limit.

Moonshot, founded in 2023 by AI researcher Yang Zhilin, is among several Chinese AI startups that have recently gained prominence by releasing powerful open-source models at a significantly lower cost compared to offerings from U.S. companies like OpenAI and Anthropic.

Benchmark tests suggest Kimi K3 outperforms Anthropic's Opus 4.8 and OpenAI's ChatGPT 5.5 on many coding tasks, though it is noted as being less capable than Anthropic's Fable model.

Reuters reported that Moonshot is in discussions with financial institutions, including Goldman Sachs, regarding a potential initial public offering in Hong Kong. The company is reportedly seeking an additional $2 billion in capital, having already raised over $5.5 billion from investors. Moonshot's valuation stood at $30 billion as of June.

The rapid advancement of Chinese AI capabilities has raised concerns among some U.S. officials, particularly given export controls aimed at limiting China's access to advanced computer chips.

Previously, Anthropic has accused Chinese competitors, including Moonshot, DeepSeek, and Minimax, of utilizing unauthorized "distillation" techniques—where a more advanced AI model is used to train a new one—to replicate their technology. It remains unclear if Anthropic suspects this method was employed in the development of Kimi K3.