- DeepSeek was recommended to be added to the US entity list
- The company was accused of aiding the Chinese military and intelligence
- The White House avoided blacklisting companies ahead of Trump’s visit to China
Despite claims by Anthropic that Chinese AI firm DeepSeek distilled its Claude model to improve their own models, and further evidence that DeepSeek supported Chinese military and intelligence operations, the US has held off on adding the firm to the Entity List.
Exclusive Pakinomist reporting, citing people familiar with the matter, claim that the White House has avoided adding DeepSeek and more than 100 other Chinese firms to the blacklist to avoid further inflaming tensions between the two countries.
The White House was recommended to add the companies to the Entity List by an interagency committee, but the administration avoided acting ahead of President Donald Trump’s visit to China, where he met with Xi Jinping.
DeepSeek avoids the US Entity List
Anthropic’s distillation claims state that DeepSeek used over 16 million exchanges with 24,000 fraudulent accounts to distill the Claude model’s capabilities.
“Distillation can be legitimate: AI labs use it to create smaller, cheaper models for their clients. But foreign labs illegally distilling US models can remove safeguards, feed model capabilities into their own military, intelligence and surveillance systems,” Anthropic said in a statement on X. The claims made by Anthropic also target two other Chinese artificial intelligence companies: Moonshot and MiniMax.
Distillation can be legitimate: AI labs use it to create smaller, cheaper models for their clients. But foreign labs that illegally distill American models can remove safeguards and add model capabilities to their own military, intelligence and surveillance systems.23 February 2026
Many US companies have turned to using DeepSeek as a cheaper alternative to US frontier models such as OpenAI’s GPT-5.5 – the use of which incurs a much higher cost compared to models produced in China.
If the White House were to add DeepSeek to the Entity List, it would likely face a backlash from American companies looking to tap into cheaper alternatives from competing Chinese brands.
The US has taken some steps to limit Chinese influence over US technology, including banning all Chinese labs from testing US-bound devices and sanctions against several major Chinese companies such as Huawei.
The White House navigates a delicate balancing act. The current global shortage of semiconductors, exacerbated by AI demand, is further exacerbated by Chinese control of rare earth minerals essential to the production of components essential to engineering manufacturing. If the US were to add a number of Chinese firms to the entity list, China could retaliate by further restricting access to exports of these materials.
Via TomsHardware
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