US Probes Singapore’s Role in Supplying NVIDIA’s AI Chips to China; 20% of Team Green’s AI Revenue At Risk

The United States is now taking a closer look at whether DeepSeek managed to obtain NVIDIA’s AI chips using middlemen in Asia, as it seeks to identify any potential trade loopholes.

In response to DeepSeek’s AI success, the US has ramped up its export restrictions, with a particular focus on addressing possible trade workarounds. Despite multiple rounds of stringent export controls, countries like China are still reportedly gaining access to NVIDIA’s advanced AI chips, such as the H100s. According to Bloomberg, there is an ongoing investigation by US officials into whether these chips have been redirected to Chinese companies through countries like Singapore, which could lead to serious repercussions if such trade loopholes are confirmed.

So, why is Singapore under scrutiny? Data shared by @KobeissiLetter reveals a staggering increase of up to 740% in NVIDIA’s sales to Singapore since DeepSeek’s inception. Considering Singapore isn’t prominently involved in the AI technology race, this significant uptick has raised red flags about potential loopholes. NVIDIA has conceded that the billing address doesn’t necessarily match the end-user location, suggesting an awareness of these possible bypasses around US restrictions.

A Twitter post from The Kobeissi Letter questions whether DeepSeek unlawfully acquired NVIDIA’s chips, noting the substantial sales figure and the implications of such actions.

Furthermore, reports indicate that China has imported a significantly larger volume of chips from Singapore than the US, despite Singapore only hosting 99 data centers. This raises further concerns. DeepSeek, reportedly equipped with computational assets exceeding $1.6 billion, possesses approximately 10,000 of NVIDIA’s “China-specific” H800 AI chips and 10,000 of the more advanced H100 chips. Clearly, China continues to have access to state-of-the-art AI hardware, rendering current US restrictions ineffective for the moment.

The investigation isn’t solely focusing on Singapore; other nations like the Philippines are also under the microscope for potentially supplying chips to China. With the US preparing to initiate a formal inquiry, NVIDIA’s 20% AI revenue growth stands vulnerable. Should the US decide to clamp down on these trade channels, it could lead to significant consequences, impacting not just NVIDIA but the broader AI market landscape.