ChinaTalk

Gray market API proxy network enables discounted access to U.S. AI models in China via fraud and distillation

A ChinaTalk report details an informal ecosystem of API proxy servers, account farms, identity brokers, and token resellers that gives Chinese developers access to U.S. AI models like Claude, ChatGPT, and Gemini at steep discounts — sometimes 10% of market price — through methods ranging from terms-of-service violations to credit card fraud. CISPA Helmholtz Center research found proxy 'Gemini-2.5' access achieved only 37% on MedQA versus 83.82% via Google's official API, suggesting model substitution is common. The network also harvests API call logs as training data, feeding the industrial-scale distillation practices Anthropic accused DeepSeek, Moonshot, and MiniMax of in February. The White House acknowledged the distillation threat in an April memo, framing it as an adversarial national security concern.