A black market for the chips has developed, with chips being smuggled into China or accessed remotely by China-based employees. The US's goal is not to completely block China's access, but to limit it enough to prevent China from getting ahead. However, Nvidia's CEO has warned that the restrictions could backfire, causing US companies to lose revenue and fall behind competitively.
Key takeaways:
- Despite US efforts to block China from accessing advanced Nvidia chips, Chinese entities including military bodies, AI research institutes, and universities have managed to buy small batches of these restricted chips.
- It remains unclear how suppliers are procuring these chips, and neither Nvidia nor its approved retailers are among the identified suppliers.
- A black market for chips has developed, selling excess stock or chips imported through companies in places like India, Taiwan, and Singapore.
- Nvidia CEO Jensen Huang has warned that the curbs could have the opposite effect, potentially causing US companies to fall behind competitively due to lost revenue from restricted sales in China.