Trump administration may restrict Nvidia sales to China

The Trump administration is reportedly considering new restrictions on Nvidia's sales of AI chips to China, particularly targeting its H20 processor.

This potential move follows the recent release of DeepSeek’s R1 model, which has raised concerns about China's growing capabilities in artificial intelligence.

According to a Bloomberg report on January 29, the administration is contemplating a ban on the export of Nvidia's H20 AI processor to China.

The H20 chip is a modified version of Nvidia's H100 processor, designed specifically to comply with U.S. sanctions.

If implemented, these restrictions would mark the fourth time since 2022 that the U.S. government has tightened controls on high-performance computing chips and semiconductors destined for China.

Such measures could negatively impact Nvidia's profits and potentially reduce the United States’ market share in the rapidly expanding AI sector.

Nvidia’s stock price has already been affected following the unveiling of DeepSeek’s R1 model, indicating market sensitivity to regulatory changes.

In previous instances, U.S. export controls have led China to develop its own AI capabilities using weaker semiconductors, thereby reducing reliance on American technology.

Despite existing restrictions, Chinese firms have managed to bypass sanctions by accessing banned AI hardware through cloud computing services like Amazon Web Services.

Critics argue that these export controls not only hinder U.S. competitiveness but also fail to effectively prevent other countries from acquiring advanced AI technology.