Is China's DeepSeek using Nvidia's banned Blackwell AI chips? Here's the truth

In light of reports suggesting that popular Chinese artificial intelligence (AI) startup DeepSeek is using smuggled Blackwell chips to train advanced AI models, Nvidia has responded to allegations.

The purported reports outline that, considering the US' ban on Nvidia chips for China, DeepSeek is procuring the most advanced chips from illicit, backdoor channels to maintain its edge in the AI race.

While the use of Blackwell chips by DeepSeek raises concerns about the integrity of supply chains, an Nvidia spokesperson stated, “We haven’t seen any substantiation or received tips of ‘phantom data centres’ constructed to deceive us and our partners,” while acknowledging the seriousness of any smuggling claims.

The chip maker giant Nvidia has made the most of the still-ongoing AI boom, as its graphics processing units (GPUs) are essential for training AI models and managing large workloads.

This huge reliance on its chips has made Nvidia's relationship with China a contentious issue among U.S. lawmakers.

Notwithstanding lawmakers' dissent with Nvidia-China deals, the surprising turn of events is that US President Donald Trump recently lifted the ban, allowing Nvidia to ship its H200 chips to "approved customers" in China, provided the U.S. receives 25% of the sales. This reversal has drawn criticism from some Republicans.

China's DeepSeek stepped into the limelight in January with its reasoning model, R1, which quickly ascended app store rankings and was developed at a lower cost than comparable U.S. models.

The AI firm has also hinted at plans for China to produce its own next-generation chips to support its AI initiatives in a bid to cut dependence on outsourced chips.