WASHINGTON – Chinese AI startup DeepSeek’s latest AI model, expected to be released as early as next week, was trained on Nvidia’s cutting-edge AI chip Blackwell, which could violate U.S. export controls, a senior Trump administration official said Monday.
The U.S. trusts Deep Seek to remove technical indicators that could reveal the use of U.S.-made AI chips, the official said, adding that Blackwell is likely focused on its data centers in Inner Mongolia, an autonomous region of China.
The official declined to say how the U.S. government obtained the information or how Deep Seek obtained the chip, but stressed that U.S. policy is “not to ship Blackwell to China.”
Nvidia declined to comment, while the Department of Commerce and DeepSeek did not respond to requests for comment.
The Chinese embassy in Washington said Beijing opposes “drawing ideological lines, overextending the concept of national security, expanding the use of export controls, and politicizing economic, trade, and technology issues.”
The U.S. government’s confirmation that DeepSeek obtained the chips, first reported by Reuters, could further divide opinion among policymakers in Washington who are struggling to decide where to draw the line on China’s access to America’s crown jewels: American AI semiconductor chips.
White House AI czar David Sachs and Nvidia CEO Jensen Huang have argued that shipping advanced AI chips to China will prevent Chinese competitors like Huawei from redoubling efforts to catch up to Nvidia and AMD’s technology.
But China hawks worry that the chips could be easily diverted from commercial use, strengthening China’s military and threatening America’s dominance in AI.
“This shows why exporting AI chips to China is so dangerous,” said Chris McGuire, a former White House National Security Council official under former President Joe Biden.
“Given the brazen violation of U.S. export controls by China’s leading AI companies, we clearly cannot expect them to abide by U.S. conditions prohibiting them from using their chips to support the Chinese military,” he added.
U.S. export regulations overseen by the Department of Commerce currently prohibit Blackwell from shipping to China.
In August, US President Donald Trump opened the door for Nvidia to sell a scaled-down version of Blackwell in China. But he later reversed course and suggested the company’s cutting-edge chips should be reserved for U.S. companies and kept out of China.
President Trump’s decision in December to allow Chinese companies to buy Nvidia’s second most advanced chip, the H200, drew harsh criticism from China hawks, but chip shipments are still being held up by guardrails built into the approval.
“Chinese AI companies’ reliance on smuggled Blackwell highlights the severe shortage of domestically produced AI chips and why the approval of the H200 chip is a lifeline,” said Saif Khan, who served as director of technology and national security at the White House National Security Council under former President Joe Biden.
The official declined to comment on how the latest news would affect the Trump administration’s decision on whether to allow DeepSeek to purchase the H200.
The models they helped train likely relied on a “distillation” of models created by cutting-edge U.S. AI companies, including Anthropic, Google, OpenAI, and xAI, echoing claims made by OpenAI and Anthropic, the officials added.
The technique, known as distillation, involves having an older, more established and powerful AI model assess the quality of the answers it gets from a new model, effectively transferring the older model’s learnings.
Hangzhou-based DeepSeek shook up the market early last year with a series of AI models that rivaled some of the best products in the United States, fueling concerns in Washington that China would catch up to the AI race despite its regulations.
TheInformation previously reported that DeepSeek was smuggling chips to China to train its next model. Reuters first reported that the US government had confirmed that the chips were used for that purpose at Deep Seek’s Inner Mongolia-based facility.
(Reporting by Steve Holland and Alexandra Alper; Editing by Chris Saunders, Sonali Paul and Thomas Derpinhaus)
