The US government is discussing further restrictions on Nvidia's chip sales to China, potentially targeting the company's H20 chips - products specifically designed for the Chinese market to comply with existing US trade rules.
According to Bloomberg, these talks are just beginning as the Trump administration works to staff key departments. During his confirmation hearing, incoming Commerce Secretary Howard Lutnick said he would take a firm stance on semiconductor oversight.
The Biden administration's final actions included tighter export controls for AI hardware and models, creating a three-tier licensing system. While 18 close allies like Japan, the UK, Germany and the Netherlands maintain full access, about 120 countries including Israel, Saudi Arabia and the UAE face strict quantity limits. China, Russia, Iran, and North Korea cannot import these chips at all.
For Nvidia, which has faced increasing sales limits in China since 2022, expanded restrictions would further reduce its presence in the world's largest semiconductor market. The company warned against the latest export rules, saying they would push China toward self-sufficiency while putting US firms at a disadvantage. Huawei is one potential company to fill the void. Nvidia's stock dropped 6.9% when news broke about potential H20 GPU restrictions.
Anthropic CEO defends strict export controls
Anthropic CEO Dario Amodei recently supported these strict export controls, citing concerns about China matching US AI capabilities and gaining military advantages. Responding to Deepseek's R1 model release, Amodei said their progress actually reinforces the need for such controls.
He points out that Deepseek has made AI development more cost-effective, achieved performance close to US models, and already commands significant computing resources. Rather than seeing improved efficiency as a reason to ease restrictions, Amodei believes any freed-up computing power will likely go toward scaling up AI systems.
