The United States is currently looking into whether DeepSeek was able to acquire NVIDIA’s AI chips via Asian intermediaries, in order to pinpoint any possible trade loopholes.
Following the DeepSeek controversy, U.S. authorities have ramped up their efforts to keep domestic technology from falling into the hands of hostile nations like China. Even with stringent export controls and restrictions in place, countries such as China still manage to get their hands on NVIDIA’s top-tier AI chips, including the H100s. Based on a report from Bloomberg, American officials are now investigating if these chips found their way to Chinese companies through intermediaries in places like Singapore. If they confirm a loophole, the ramifications could be significant.
But why focus on Singapore? According to insights shared by @KobeissiLetter, NVIDIA’s sales to Singapore have reportedly skyrocketed by an astonishing 740% since DeepSeek was established. Given that Singapore isn’t heavily engaged in the AI battle, this surge in sales raises suspicions about a possible loophole. NVIDIA has also hinted that billing and end-user locations might differ, acknowledging the workaround for U.S. restrictions that might exist.
The situation further complicates with reports suggesting China has imported chips from Singapore in numbers far exceeding those received by the U.S., despite Singapore housing only 99 data centers. For context, DeepSeek is said to control computational resources valued at over $1.6 billion, equipped with approximately 10,000 of NVIDIA’s “China-specific” H800 AI GPUs alongside another 10,000 high-end H100 AI chips. Clearly, China isn’t lacking in advanced AI GPUs, rendering the U.S.’s attempts to curb technology export seemingly ineffective at the moment.
Adding to the complexity, other nations like the Philippines are also rumored to be channels through which chips are reaching China. Given that the U.S. plans to initiate a formal investigation, NVIDIA’s substantial 20% AI revenue hangs in the balance. Should the U.S. successfully eliminate this trade avenue, the repercussions could extend beyond NVIDIA, potentially shaking the AI industry as a whole.
