"it has already caught the regulator’s attention so even the law could be rewritten around these models"
The law moves slow. Even were that to happen eventually, the laws will very likely be challenged in courts, and those will take a while to be resolved.
Finally, even if the US outlaws this, there'll be plenty of other countries where it'll be legal. There's plenty of infringement of US copyright in China, for instance. The same is likely to happen in regards to AI that's illegal in the US but legal elsewhere.
By the time the law catches up, model creation may become so easy to create by individuals instead of just by deep-pocketed corporations, it may be practically impossible to stop.
The law moves slow. Even were that to happen eventually, the laws will very likely be challenged in courts, and those will take a while to be resolved.
Finally, even if the US outlaws this, there'll be plenty of other countries where it'll be legal. There's plenty of infringement of US copyright in China, for instance. The same is likely to happen in regards to AI that's illegal in the US but legal elsewhere.
By the time the law catches up, model creation may become so easy to create by individuals instead of just by deep-pocketed corporations, it may be practically impossible to stop.