Chinese AI Toys Raise Child Privacy Concerns Among U.S. Officials

WASHINGTON — U.S. officials are sounding alarms over a new generation of AI-powered toys manufactured in China, citing significant data privacy risks that could potentially expose American children’s personal information to foreign access.

The rapidly expanding market for these smart toys is projected to reach $14 billion in China by 2030, according to a joint report from the Shenzhen Toy Industry Association and JD.com. Globally, the industry is expected to grow even more substantially, with forecasts suggesting a $25 billion market by the end of the decade.

Rep. Raja Krishnamoorthi (D-Ill.) has emerged as a leading voice raising concerns about these high-tech playthings that are increasingly being marketed to both American parents and educators. The House Select Committee on the Chinese Communist Party, addressing the issue formally, sent a letter to Education Secretary Linda McMahon highlighting what they describe as serious “data privacy and child safety concerns” associated with AI toys produced by companies based in the People’s Republic of China.

One product specifically flagged by officials is BubblePal, a device manufactured in China that clips onto stuffed animals and operates using DeepSeek’s large language model. The toy has already gained significant market penetration, with approximately 200,000 units sold since last summer. What particularly troubles lawmakers is that BubblePal stores voice recordings and conversation histories in cloud-based systems that could potentially fall under China’s data-access laws.

“These toys aren’t just collecting passive data—they’re actively engaging with children as young as three years old, recording conversations and storing that information in ways that might be accessible to foreign entities,” said a source familiar with the committee’s investigation who requested anonymity to discuss ongoing security concerns.

The growing tension around these toys reflects broader U.S.-China technological competition and data security issues. Chinese manufacturers have dominated global toy production for decades, but the integration of artificial intelligence capabilities introduces new dimensions of risk that traditional toys never presented.

The committee’s letter urges Secretary McMahon to take several concrete steps in response to this emerging threat. First, they recommend launching a nationwide awareness campaign specifically targeting educators about the potential risks associated with introducing these technologies into classroom settings. Additionally, they call for improved coordination between federal agencies to enhance regulatory oversight of AI-enabled children’s products entering the American market.

Perhaps most urgently, the committee is pushing for clear guidance to be developed and distributed to parents explaining how their children’s data could potentially be collected, stored, and accessed when using these smart toys.

“Given the security risks and privacy concerns associated with these products, I urge you to initiate a campaign aimed at raising public awareness among American educators across the country on the potential misuse of the data collected with these devices,” Krishnamoorthi wrote in the letter.

The concerns come at a time when AI-enabled consumer products are proliferating rapidly across all sectors, often outpacing regulatory frameworks designed for previous generations of technology. Children’s products face particular scrutiny in the United States, where the Children’s Online Privacy Protection Act (COPPA) establishes special protections for data collected from children under 13 years old.

Industry analysts note that while privacy concerns are legitimate, they must be balanced against the educational potential of AI-enhanced toys, which can offer personalized learning experiences and developmental benefits that traditional toys cannot match.

As regulators and legislators grapple with these complex issues, parents and educators find themselves on the front lines of making decisions about which technologies to introduce to children. The committee’s actions signal an increasing focus on ensuring that technological innovation doesn’t come at the expense of children’s privacy and security.