Trump Weighs Stricter Nvidia AI Chip Ban as China Finds Workarounds

The U.S. government is weighing stricter controls on Nvidia’s AI chip exports to China, with President Donald Trump reportedly considering a fresh round of restrictions in response to concerns over the impact of DeepSeek’s R1 model.

According to Bloomberg, sources indicate that the administration may move to block the sale of Nvidia’s H20 processor, a downgraded version of the H100 chip designed to comply with previous U.S. trade regulations.

If implemented, these measures would mark the fourth major tightening of semiconductor export rules since 2022. Stricter controls could deal a financial blow to Nvidia, curbing its revenues and potentially weakening the U.S. position in the global AI race.

After the U.S. first restricted sales of Nvidia’s H100 chips to China in October 2022, Chinese tech firms pivoted to developing AI using domestically produced semiconductors and hybrid chip configurations. This shift aimed to diversify supply sources and reduce dependency on U.S. technology.

READ MORE:

Top 5 Reasons Why a U.S. Bitcoin Reserve Could Become Reality

Further restrictions followed in 2023 under President Joe Biden’s administration, with a new round of regulations in October tightening the ban on modified AI processors and semiconductor hardware that had previously slipped through earlier policies. Despite these efforts, reports suggest that Chinese firms linked to the state have found ways to acquire restricted AI processing power by utilizing cloud computing services such as Amazon Web Services. By using intermediaries and shell companies, these entities managed to sidestep direct restrictions while still accessing high-performance computing.

Opponents of these export curbs argue that while they may serve national security interests, they also risk stifling U.S. innovation and harming domestic chipmakers without effectively cutting off access to AI technology for foreign competitors.

Kostadin Dimitrov