Woofun AI reports that US AI companies are reducing inference costs to address the growing threat of model distillation, particularly from Chinese alternatives like DeepSeek. Serenity highlights that lower unit task costs drive startups toward these competitors, eroding the competitive edge of US models from OpenAI, Anthropic, and Gemini.

To counter this, Serenity advocates for two strategies: implementing robust access controls akin to "AI-grade banking authentication" with heavy KYC and tiered access, and enhancing the cost-efficiency of US inference models. The goal is to balance low-cost capabilities with financial-system-level security to prevent unauthorized model exploitation.