The Software Blockade: Why US Sanctions on Chinese AI Weights Will Reshape Startup Economics

In January 2025, a Chinese AI model built for an estimated $5.6 million in training costs matched the performance of proprietary US models that cost upwards of $100 million to develop. This sudden price-to-performance disruption sent shockwaves through the venture capital and software development sectors. Now, the US government is signaling a major policy shift, moving its containment strategy from hardware blockades to direct legal