Chinese artificial intelligence startup DeepSeek has relied on Nvidia Corp. chips that are banned in the country to develop an upcoming AI model, according to a new report in The Information.
Nvidia’s Blackwell chips were smuggled into China through countries that permitted their sale, The Information reported, citing unnamed sources. More specifically, DeepSeek tapped chips that were installed in data centers in unspecified countries, then dismantled and shipped to China after clearing inspection by companies developing server equipment, The Information said.
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The US bans the sale of these advanced semiconductors to China, which has led AI developers there to access the hardware through data centers located outside of the mainland or subterfuge. In November, US prosecutors charged two Chinese nationals and two US citizens with a scheme to ship chips to China by way of Malaysia using a fake real estate business.
A representative for DeepSeek didn’t immediately respond to a request for comment.
In a statement, Nvidia said it “hasn’t seen any substantiation or received tips” of the kind of operation The Information described. “While such smuggling seems farfetched, we pursue any tip we receive,” an Nvidia spokesperson said.
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DeepSeek drew global attention in January when it debuted an AI model that was competitive with Silicon Valley’s best and said it had built it at a fraction of the cost. The startup was funded by the Chinese hedge fund High-Flyer, which had amassed 10,000 Nvidia GPUs in 2021, prior to US bans on exports of sophisticated Nvidia chips and other graphics processing units.
Earlier this week, President Donald Trump granted Nvidia permission to ship to China an older version of its AI accelerators, the H200. An export ban on its more powerful Blackwell version remains in place.
Beijing has meanwhile pushed Chinese technology companies to rely on domestic equipment to develop AI. DeepSeek released a new model in September and indicated that it was working with Chinese chipmakers on the model.
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