I don't think anyone is surprised by this.. And I'm almost certain nothing will happen. When manufacturing is next door to you, you'll find a way to get your hands on chips.
The phrasing "chips that are banned in the country" seems completely inaccurate. These are chips that the US does not allow to be exported to China. We do not have the power to ban anything in China, that's up to the Chinese government.
I recommend everyone to watch GamersNexus' documentary on the NVIDIA AI GPU black market.
They explain how companies like DeepSeek can get a hold of chips that are otherwise banned by the US government to export to China
CIA disinformation campaigns notwithstanding, maybe accept global competition, open-source models, and the fact that whatever advantage OpenAI had was fleeting and mostly squandered at this point. The tendency of the rate of profit to fall is especially brutal if you've never made a profit.
It seems pretty difficult to prevent two other countries from trading, especially when it is sort of low-volume (I mean how many boats full of GPUs was this? It isn’t like oil or something, where we can see the infrastructure to consume it via satellite).
Good. Unsurprising (well, known), but good. In fact, the world would be a better place if the US would not use their influence to try to keep other countries down.
I agree that a fair playing field for everyone would be the ideal state.
But let's not pretend China doesn't use their influence to keep other countries down as well, and let's not pretend they allow a fair playing field for foreign competitors domestically either.
The US would not have imposed these targeted sanctions if China simply wanted to fairly compete in the marketplace.
It’s debatable whether it’s a better use of US power and resources to try to stop PRC from obtaining these chips versus, say, sinking the Chinese fishing fleets actively wrecking entire ecosystems. I probably agree with you that on balance working on the later problem has a higher long term ROI.
China has promised to wage war and forcibly subjugate Taiwan, a democratic ally and critical trade partner. If China backed off Taiwan for a few decades, I think the US would drop export controls.
Sanctions just slightly increase the cost of obtaining an item, but don't make it impossible. Electronic components can be bought, oil can be sold, ChatGPT can be used via OpenRouter, sanctioned banks publish their apps under guise into App Store, etc. When there are 200 countries in the world, and money involved, you can get anything.
Sanctioned goods could be used to spread propaganda though, imagine, for example, if installing a NVIDIA GPU driver required answering questions about Tiananmen square incident.
This is tangential but the whole Tiananmen Square thing is kind of odd. When I visited China many people were more willing to discuss it than I had imagined. Some spoke about it unsolicited. It’s a tourist destination you have to buy tickets for. It’s rather subtle what can and cannot be discussed relating to it. Those I spoke to about it told me that most people have a good understanding of what happened, and many people speak negatively of the CCP. You just can’t do it if you have a major platform (e.g. you’re Jack Ma or you are an LLM).
Not to discount how negative free speech restrictions are, but I’m not so sure how effective that particular propaganda campaign would be.
Since the supply chain is all from the same place, they can get so creative and resourceful. You can get 48 and 96GB VRAM 3090 on the grey market which is pretty awesome.
Where can you get 48/96GB 3090s? I know there are 24GB customized RTX 2080s (there were a few on ebay even last I checked) but I've never even heard of the 3090 being upgraded before.
I’ve seen comments saying that many foundational model providers like DeepSeek haven’t done a full pretraining in a long time. Does that mean this use of chips is in reference to the past?
Whilst there aren't many papers on the matter, I would guess that pretraining from scratch is a bit of a waste of money when you could simply expand the depth/width of the 'old' model and retrain only the 'new' bit.
Long term consequences: China outperforms Nvidia, by producing cheaper, faster chips at a large scale, by getting inspired by the IP but using their own production lines.
Through sanctions, the irony is that the west removed the incentive for China to respect IP laws.
Well done.
If they can solve the lithography/ASML issue by getting access to it, then they will be forced to win.
I don't know much about GPUs, but is there really any value in IP? I can learn to write HDL code all day long, but turning it into real transistors is the hard part. Code is worth nothing nowadays with AI.
There is a sudden groundswell of reports about China using nvidia chips, always by unnamed sources, and I suspect if you could trace it back you'll find nvidia pulling the levers.
nvidia is facing a lot of competitive threats and their moat is being filled in. Google with their Ironwood TPU. Amazon with Trainium3. Even Apple is adding tensor cores to their chips, and if Apple went big scale it would be legitimate in the space as well.
We know that China has a number of upstart TPU vendors, and Huawei has built some "better than H200" solutions with a roadmap to much higher heights.
So there is suddenly a bunch of secret-source reports that no, China actually is totally reliant on nvidia. nvidia needs this to be true, or at least people to believe it to be true.
I mean, after all the fanfare about the H200 being allowed to be exported, nvidia shares...dropped. The market doesn't seem to be buying the China reliance bluster.
Are these chips that are now banned but we're previously available? If so, doesn't this basically mean nothing? They could just be using chips that they bought when they were allowed to buy them.
Afaik, data center grade blackwell chips have never been legal for export to china. I think this has more do to with NVIDIA than DeepSeek. For a brief moment, people thought DeepSeek had found some way to produce AI without sending boatloads of cash to NVIDIA, causing a drop in share price.
Shortly thereafter people realized they were probably just evading sanctions and ~stealing~ bootstrapping parameters from other models to reach their stated training cost. This report is just further reporting on that rumor.
The ban is on Nvidia selling the chip to China. There is no ban on China using the chips. So long as NVidia isn't knowingly selling the chips to China this is a nothing burger.
The neo cloud providers, especially those outside the US, with dubious financial backing, that are buying Nvidia chips as if they were an appreciating asset, kind of like being a bitcoin treasury, will be tempted to create some income in ways that break sanctions.
What's strange in this discussion of chips and export bans is there's been zero discussion of cloud access, I guess networked computers are difficult for America's gerontocrats to understand.
I've rented H100s no problem on American servers and there's no KYC or anything, they let anybody do it.
Imagine being a blackmarket GPU smuggler. High danger and high reward to get the most advanced AI silicon to a corporation operating under a repressive regime.
Meanwhile, Nvidia is in the awkward position of being legally required to deny everything but economically incentivized to sell as much as Washington allows
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[ 3.4 ms ] story [ 70.6 ms ] threadhttps://www.youtube.com/watch?v=1H3xQaf7BFI
But let's not pretend China doesn't use their influence to keep other countries down as well, and let's not pretend they allow a fair playing field for foreign competitors domestically either.
The US would not have imposed these targeted sanctions if China simply wanted to fairly compete in the marketplace.
Sanctioned goods could be used to spread propaganda though, imagine, for example, if installing a NVIDIA GPU driver required answering questions about Tiananmen square incident.
Not to discount how negative free speech restrictions are, but I’m not so sure how effective that particular propaganda campaign would be.
Through sanctions, the irony is that the west removed the incentive for China to respect IP laws.
Well done.
If they can solve the lithography/ASML issue by getting access to it, then they will be forced to win.
nvidia is facing a lot of competitive threats and their moat is being filled in. Google with their Ironwood TPU. Amazon with Trainium3. Even Apple is adding tensor cores to their chips, and if Apple went big scale it would be legitimate in the space as well.
We know that China has a number of upstart TPU vendors, and Huawei has built some "better than H200" solutions with a roadmap to much higher heights.
So there is suddenly a bunch of secret-source reports that no, China actually is totally reliant on nvidia. nvidia needs this to be true, or at least people to believe it to be true.
I mean, after all the fanfare about the H200 being allowed to be exported, nvidia shares...dropped. The market doesn't seem to be buying the China reliance bluster.
Shortly thereafter people realized they were probably just evading sanctions and ~stealing~ bootstrapping parameters from other models to reach their stated training cost. This report is just further reporting on that rumor.
I've rented H100s no problem on American servers and there's no KYC or anything, they let anybody do it.
Sounds straight out of sci-fi.
> The US bans the sale of these advanced semiconductors to China
Whoa there, Bloomberg; just because the USA bans the sale of something to your country doesn't make it banned in your country.