Y Combinator's CEO wants US open-weight labs to distill frontier models

Y Combinator CEO Garry Tan argues that regulators should stay out of the fight over Chinese labs using distillation. "I would do nothing," he told CNBC. He told TechCrunch that he wants smaller American open-weight labs to apply the same training techniques to American frontier models, so the US ends up with open-weight options that are not Chinese. Tan is not defending the use of stolen credentials. His argument runs two ways: it is overreach for labs to dictate what customers do with model output, and closed labs themselves ingested copyrighted material without permission. Anthropic CEO Dario Amodei had previously called on regulators to crack down on distillation.