The rise of language models like ChatGPT has introduced Social AI as a new form of entertainment, particularly among young adults who engage with AI-powered agents. This paper investigates the effects of these interactions on users' social and mental well-being, a subject that has incited extensive debate among both the public and scholars. Our study involved a survey of 5,260 users of Chai, a Social AI Platform. The findings indicate significant benefits, with notable variations across demographics. Female users, in particular, reported the most substantial improvements: 43.4% strongly agreed that Social AI positively impacted their mental health, exceeding male users by 10.5%. In managing social anxieties, 38.9% of females strongly agreed on a positive impact, compared to 30.0% for males and 27.1% for other genders. Historically, new media and technology have often been met with groundless moral panic, with societal figures raising concerns without substantial evidence of harm. Our research indicates the importance of approaching such claims with caution and emphasizes the necessity of an evidence-based perspective in discussions about the behavioral effects of emerging technologies.