There was a alleged route used to smuggle around 240k Nvidia chips that were prohibited from being sold in china. Most of these were H100s and H200s totaling about 7.5b. They were able to do this because there was many layers that were involved in this smuggling. From using other countries, companies that helped move the products and finding loopholes within US export laws. Here is some of what was known about how this took place.
How they got the chips to China.
1. Intermediary Hubs & Southeast Asian Shell Companies
* There were multiple companies that were used to accomplish this. Mainly a Singaporean company called **Megaspeed** and it’s Malaysian branch **Speedmatrix**. They were able to buy these chips because countries in southeast asia didn’t have bans on them like China did. So they could use these companies to buy chips and pretend they were just helping build out data centers in those areas.
* Once the companies had bought these chips. There would be little to no records of people signing things or even linking the companies together. One person who was an executive at Megaspeed was Alice Huang or Huang Le. She would be the one making these orders but never leaving any information behind that could link her to it. By using all of these shell companies they were able to create “end users” that would look fine to Nvidia when checking.
2. Physical Smuggling and Transshipment
* After BIS inspectors went to speed matrix’s data centers in Johor Malaysia they found that some of these chips were still in their boxes. Which leads us to believe that after these were purchased by companies that were trying to make it look like data centers were being built. That they would take these and break them open to send them over to China.
* Once they made it to China they would sell these chips to Chinese companies that were building out there data centers. One company was Shanghai Century Litong.
* Similar to other chip smuggling routes they found they would use multiple countries to transport these servers. Which included Malaysia, Singapore, Indonesia and Hong Kong. Allowing them to remove any evidence of where they came from.
3. The “Compute Renting” Cloud Loophole
* Another way that these companies were able to help China out was by renting out these chips. Because US Export Controls only applied to where you could physically ship these chips. Not allow someone to remotely access them.
* So these data centers would house these chips and rent out space to chinese companies to access them remotely. Allowing them to use the computing power to help develop AI.
4. Executive Proximity & Corporate Cover
* Because Alice Huang was friends with Jensen Huang CTO of Nvidia. He may have allowed these companies to get away with this. As they could bypass any checks that were done when buying from Nvidia.
* There were reports that after US officials began looking into these shipments that Nvidia looked into it themselves. And found nothing that would point to the company breaking US export laws. Allowing them to keep selling these chips for billions of dollars. Until more intel was found on how this was happening.
Sources:
Technical Breakdown & Smuggling Pipeline Analysis:
- Tom’s Hardware: Alice Huang reportedly instrumental in securing over $7.5 billion of Nvidia AI GPU imports during relationship with Jensen Huang — Covers the physical routing, Speedmatrix facilities in Johor, Malaysia, unopened crates, and the transshipment of H100 and H200 hardware.
Investigation & Corporate Governance Inquiries:
- Fox News: Nvidia, CEO Jensen Huang sued over alleged Chinese spy ties amid FBI probe — Details the shareholder lawsuit, the Wachtell Lipton independent board inquiry, Wall Street reaction, and congressional oversight.
- Global News: Nvidia’s CEO is facing a suspected spy affair scandal — What we know so far — Provides the timeline of the initial revelations, House committee briefing requests, and the background of Megaspeed.
- CBS News: Nvidia investigates CEO Jensen Huang amid allegations he was target of Chinese intelligence effort — Covers Huang’s statements to employees, White House comments, and Megaspeed purchase volumes.
Official Responses & Diplomatic Pushback:
Futurism: Nvidia Pulled Strings to Shut Down a US Government Investigation Into Chip Smuggling — Analyzes the interaction between corporate leadership, enforcement agencies, and export control reviews.
PBS NewsHour: China dismisses claims of spy plot involving Nvidia CEO Huang as a smear campaign — Summarizes official denials from Beijing’s Ministry of Foreign Affairs and the broader semiconductor trade backdrop.