Venture capitalist Chamath Palihapitiya warned that any U.S. move to ban open-source AI would blow a hole in corporate balance sheets and drag the stock market down.
"If the United States government intervenes, it will tank the stock market. Not debatable," Palihapitiya said on the "All-In" podcast released over the weekend. "Now, you can debate which companies get tanked. For example, if they said, 'No more open source. American companies cannot use open source.'"
Chamath: Banning Open Source AI Will Crash the Stock Market. @chamath: "If the United States government intervenes, it will tank the stock market. Not debatable. Now, you can debate which companies get tanked..."
— The All-In Podcast (@theallinpod) July 25, 2026
"Okay, let's take an average normal company, Coca-Cola," Palihapitiya continued. "'Hey, Coca-Cola, you're trying to use AI to improve your business. You know what? You can only use these two options. And those things cost 50-100x more than your other best alternative that you may use otherwise.'"
"That will eventually show up in your costs. And so this incredibly important input into your cost model is now orders of magnitude, multiples greater than your competitors that are outside the United States, simply because you're in the United States," he added. "You're forced to absorb costs that aren't rational nor market-driven. So then Coca-Cola has to get re-rated."
Palihapitiya then turned on the labs themselves, arguing that their revenue depends on government-erected barriers rather than real market demand.
"But then you look at the people who are selling those tokens, and this
