Nvidia’s banned AI chips, worth over $1 billion, were smuggled into China in the three months following a U.S. export crackdown, according to a Financial Times report.
The report says Nvidia’s high-end B200 processors, restricted for sale in China, are now being sold through a thriving black market. Chinese distributors in provinces like Guangdong, Zhejiang, and Anhui began moving the chips to local AI data center suppliers as early as May.
Sales contracts, company records, and insider sources cited by the FT confirm widespread access to restricted chips, including the B200, H100, and H200. Southeast Asia has reportedly become a key region for backchannel chip flows, enabling Chinese groups to bypass U.S. rules.
Nvidia responded, saying that building data centers with unauthorized products is inefficient and unsupported. “We only offer service and support for authorized products,” the company told Reuters.
The U.S. Commerce Department and the White House declined to comment. Reuters could not independently verify the FT’s claims.
The smuggling comes amid a broader U.S.-China standoff over AI dominance and national security. Washington imposed tighter export controls in April, aiming to limit China’s access to advanced chips used for military and surveillance technologies.
Although Nvidia recently regained approval to sell certain models like the H20 in China, the black market activity underlines how complex enforcement has become.
U.S. officials are now considering more export restrictions, possibly extending to countries like Thailand by September, according to industry experts quoted in the report.
