China Reportedly Obtains $1 Billion in NVIDIA AI Chips Despite U.S. Restrictions

Tech
By 24matins.uk,  published 25 July 2025 at 11h21, updated on 25 July 2025 at 11h21.
Tech

Despite ongoing US restrictions aimed at limiting China’s access to advanced technology, Chinese companies have reportedly purchased around one billion dollars’ worth of NVIDIA AI chips, highlighting continued demand for American semiconductors within China’s rapidly growing artificial intelligence sector.

Tl;dr

  • China’s black market imports banned NVIDIA AI chips.
  • Sophisticated networks bypass US export controls via Southeast Asia.
  • NVIDIA and suppliers deny any knowledge or involvement.

    • Chips on the Black Market: China’s Surging Demand for AI

    In recent months, a surge in clandestine activity has swept across the Chinese tech landscape. With restrictions imposed by the U.S. Department of Commerce tightening since late 2023, an elaborate web of intermediaries and operators has stepped in to meet an unrelenting demand for NVIDIA AI chips. These coveted processors—models such as the B200, H100, and H200—remain out of legal reach for Chinese firms, fueling a thriving parallel market that, according to documents reviewed by the Financial Times, has seen nearly $1 billion worth of prohibited hardware flow into the country.

    Southeast Asia: New Gateway for Restricted Technologies

    But it’s not just within China that these activities unfold. Evidence points squarely at Southeast Asian nations—including Thailand and Malaysia—as critical transit hubs circumventing American controls. By redirecting shipments through these countries, traders attempt to sidestep the rigorous filter enforced by U.S. authorities. Washington is reportedly considering further measures to clamp down on these emerging routes, although for now, determined actors continue to exploit these geographic loopholes.

    The Mechanics of a Shadow Supply Chain

    How do these black-market operations function? Industry insiders describe a network involving:

  • Third-party data center operators integrating contraband chips into preassembled servers.
  • Brokers facilitating deals far from official channels.
  • Social media advertisements featuring racks with logos from companies like Supermicro and ASUS.

    • While even modified models such as the H20—originally crafted to comply with U.S. export limitations—have faced periodic bans, China’s appetite for advanced processors remains undiminished.

    NVIDIA and Suppliers Respond: Denial Amid Evidence

    When pressed about these allegations, representatives from NVIDIA maintain there is « no evidence of its AI chips being diverted to China illegally. » The company argues that building data centers with unauthorized products is « a losing technical and economic gamble, » emphasizing that « warranty and support only apply to approved customers. » At the same time, firms like Supermicro and ASUS, whose branded equipment features prominently in this shadow trade, categorically deny any role or knowledge regarding where their hardware ultimately ends up.

    Yet as one Chinese distributor confided, « The history shows: with such profits at stake, solutions always emerge. » For now, global efforts to rein in this burgeoning underground market are locked in a race against relentless technological ambition—and ingenuity.