How billions of dollars worth of Nvidia chips were smuggled to China

China's black market thrives despite US restrictions on exports of advanced chips.

Nvidia GB200 super chip. Photo: Bloomberg .

A large amount of Nvidia’s advanced AI chips, worth at least $1 billion , were shipped to China just three months after US President Donald Trump tightened export restrictions, according to FT sources, highlighting a loophole in US policies to curb China’s high-tech ambitions.

The analysis, based on dozens of sales contracts, company filings and people familiar with the matter, found that the Nvidia B200 is the chip with the highest sales and demand on the Chinese black market, according to the FT .

The Chinese distributor has been selling the B200 to domestic AI data center vendors since May. This comes shortly after the Trump administration moved to block sales of the H20, a version Nvidia made specifically to comply with restrictions imposed by the previous administration of Joe Biden.

High demand, high revenue

Receiving and selling Nvidia chips in China is still legal, as long as the relevant border tax is paid, according to lawyers. However, parties selling and sending chips to China would be violating US regulations.

In mid-July, Nvidia CEO Jensen Huang said the Trump administration would allow sales of the H20 chip to China. In the previous three months, distributors from Guangdong, Zhejiang, and Anhui provinces had sold the B200 chip, along with banned models like the H100 and H200.

Contracts reviewed by the FT show that total chip sales during this period reached more than $1 billion . Meanwhile, Nvidia has always insisted that there is “no evidence of AI chip diversion,” no sign of the company’s involvement, or discovery of banned AI chip sales to China.

An Anhui-based company whose name means “Gate of the Era” is one of China’s largest suppliers of B200 chips.

According to FT , the company was newly established in February, is wholly owned by a group of the same name, was registered on the same day and is headquartered in Shanghai.

The chip is pre-installed in a rack cabinet, each rack contains 8 B200 chips, along with components and software to connect directly to the data center. Each rack is the size of a large suitcase, weighing nearly 150 kg including the packaging box.

Market prices now range from 3 million to 3.5 million yuan ( $489,000 ) per rack, down from 4 million yuan in mid-May, and about 50% higher than the average selling price of similar products in the United States.

Nvidia CEO Jensen Huang. Photo: Reuters .

Since May, Gate of the Era has received at least two shipments of hundreds of B200 racks each. The company sells them directly (or through secondary distributors) to data center providers and others. Gate of the Era and its affiliates estimate that they have sold nearly $400 million worth of the products.

Gate of the Era lists AI solutions provider China Century (Huajiyuan in Chinese) as its largest shareholder.

Also headquartered in Shanghai, China Century claims to have a lab in Silicon Valley and a supply chain center in Singapore, and uses data tools to build “a new century of intelligent China.”

China Century claims to have more than 100 business partners. Names like AliCloud, ByteDance's Huoshan Cloud, and Baidu Cloud are listed as "trusted partners" on the company's website.

When contacted by the FT , China Century said it “has no business dealings with Nvidia chips” and had not purchased chips from the company. The company’s headquarters were empty, while a Gate of the Era representative declined to comment by phone.

Lots of goods "like a seafood market"

According to industry sources, specifications and packaging images show that many B200 chips originate from Supermicro, a US company that specializes in assembling and providing chip solutions for data centers.

There is no indication that Supermicro was involved or aware of the products being smuggled into China. Speaking to the FT , a company representative confirmed that it “complies with all US regulatory requirements regarding the sale and export of GPU systems.”

“Export restrictions will not stop the most advanced Nvidia products from entering China. It will only bring inefficiency and huge profits to the parties involved who take the risk,” said a representative of a data center in China.

Nvidia logo. Photo: Reuters .

Some Chinese distributors have openly advertised products like the B200 on social media with the Supermicro logo on the packaging, but it is not yet possible to confirm whether these devices have been sold.

In addition to the B200, several other restricted Nvidia chips such as the H200, H100, and 5090 are also openly advertised on Chinese social media platforms like Douyin and Xiaohongshu.

“It’s like a seafood market. There’s no shortage of products,” said one distributor.

According to industry insiders, the B200 is in high demand due to its performance, value, and relative ease of maintenance compared to more complex chips like the Grace Backwell.

Always have shipping lines

Not only B200, GB200 AI rack, containing Nvidia's highest-end products, also appeared in China despite US export control orders.

One distributor claimed to have sold 10 GB200 racks for nearly 40 million yuan ( $5.6 million ) each. On social media, many distributors publicly listed prices and “on-site pickup” status.

Some distributors are even advertising the B300, an upgrade that Nvidia is expected to mass produce in the fourth quarter. Because of the nature of the product, major Chinese AI companies cannot order chips, install them, and maintain them in the usual way.

With the export controls on the H20 chip lifted, many Chinese tech companies are expected to continue purchasing this version in large quantities, even though the H20's performance is inferior to banned models like the B200.

Nvidia B200. Photo: Nvidia .

According to multiple distributors, sales of B200 and other restricted Nvidia chips on the black market have dropped significantly since the H20 ban was eased.

“People are considering options when H20 comes back on sale. However, demand for the most advanced products is still high,” said one distributor.

Many industry experts say Chinese corporations are buying banned Nvidia chips from several Southeast Asian countries.

The US Commerce Department is discussing adding controls on advanced AI exports to countries like Thailand starting in September, two sources told the FT. The regulation would mainly target Chinese parties that buy pirated chips.

Earlier this month, Malaysia tightened restrictions on exports of advanced AI chips to other regions, especially China. Sources said many parties were rushing to buy chips before the regulation took effect.

Even if these routes are closed, industry insiders say new shipping routes will emerge, with supplies from European countries not on the restricted list.

“History has proven time and again that with huge profits, parties will always find a way,” stressed a distributor in China.

Source: https://znews.vn/1-ty-usd-chip-nvidia-buon-lau-sang-trung-quoc-nhu-the-nao-post1572062.html