New Cheap AI from China Beats ChatGPT – Elon Musk Amazed

China is speeding up its work in artificial intelligence (AI). They've created a new AI that's better than ChatGPT and even Elon Musk's Grok in some areas. This is making things tough for the competition because this new AI is very cheap.

A startup called Moonshot AI, funded by Alibaba, created the AI called Kimi K2. It's getting a lot of attention because it performs better than ChatGPT's GPT-4.1 and Claude Opus 4 in some tests. What's even better is that it costs much less.

People in Europe and the US have to pay a lot for powerful AI like GPT-4, but Moonshot is doing things differently. Kimi K2 is open source, meaning anyone can use and change it. It's also very affordable. Developers only pay about 15 cents for every million "tokens" (units of data the AI uses to process text). In comparison, OpenAI's GPT-4.1 costs two dollars per million tokens, which is more than 13 times the price.

It's even more expensive to get output (the AI's responses) from GPT-4.1, costing eight dollars per million tokens compared to Kimi K2's 2.50 dollars. Claude Opus 4 is even pricier, costing 15 dollars for input and 75 dollars for output.

But Kimi K2 isn't just cheap. It's also designed for professional tasks, like writing computer code automatically. This can save companies a lot of money. In several tests, Kimi K2 did better than GPT-4.1 and Claude Opus 4.

Interestingly, Kimi K2 even beat Elon Musk's Grok 4 in a test called "Humanity's Last Exam." This test measures how well an AI understands language and solves complex problems. Musk mentioned Kimi when he introduced Grok 4 but lost to it in this important test.

While OpenAI is holding back its next AI model (supposedly for safety reasons), Chinese tech companies are pushing forward. Besides Moonshot, companies like Tencent, Baidu, and Alibaba are also working on powerful AI systems.

China's strategy is to be open, scalable, and fast. They're focusing on open-source models that can handle a lot of information and cost less. This is good for developers and businesses.

This means that the US might not be ahead in AI for much longer. With Kimi K2, China is showing that it's not just catching up but also setting its own standards for AI – being open, powerful, and cheap.

If you want to invest in China's AI progress, you can consider the China Tech Giants Index. It includes the most important Chinese technology companies, including leaders in internet, e-commerce, cloud computing, and AI like Alibaba, Tencent, JD.com, and Baidu.