You are correct that it’s inside the US and it doesn’t apply to the whole world. But it will apply to the western world and much further which trades in dollar because else secondary sanctions apply. The shocking number is roughly 175-180 countries of 193 follow along US sanctions, that’s 90%. Unlike in the US the citizens of those countries will not be prosecuted for circumventing the sanctions but assets like bank accounts and wallets may be seized and Visa issues may arise. With the already ongoing legislation against foreign AI players and the recent national security threat assessment it strongly looks like just a matter of time until they implement the mechanics to sanction any disfavored AI. This will flush most users back to US companies. With the limited self hosting options and insanely strong export limits for datacenters it’s already established that countries can’t build their own models with the same power.