Nvidia’s banned AI chips double in price on China’s black market, FT reports

Nvidia’s Banned AI Chips More Than Double in Price on China’s Black Market

Prices of Nvidia’s restricted AI chips have more than doubled on China’s black market over the past six months, the Financial Times reported on Tuesday, underscoring how U.S. export controls have created a vast scarcity premium even as they fail to fully cut off Chinese access to advanced computing hardware.tradingview

The DGX B300 server — housing eight of Nvidia’s advanced B300 GPUs — has surged past 8 million yuan (roughly $1.1 million) in China’s underground market, up from approximately 4 million yuan late last year, according to the FT. The same system retails for about $550,000 in the United States.reuters

Enforcement Tightens the Squeeze

The price spike reflects a convergence of supply-side pressures. China’s customs authorities began blocking imports of Nvidia’s H200 chips in January, with officials telling agents the processors were “not permitted” to enter the country. Beijing has simultaneously pressured domestic companies to avoid purchases unless strictly necessary, with narrow exceptions for university research.reuters

On the U.S. side, the Commerce Department in late May moved to close a loophole that had allowed restricted Rubin and Blackwell chips — along with AMD’s MI350x — to reach Chinese firms operating through offshore subsidiaries in countries such as Malaysia. The Bureau of Industry and Security confirmed that licensing requirements apply to all entities headquartered in China, regardless of where they physically operate.cnbc

Demand Persists Despite Domestic Push

The price surge shows that Chinese enterprises continue to seek Nvidia hardware despite Beijing’s campaign to redirect demand toward domestic alternatives from Huawei and other local chipmakers. The crackdown on grey-market smuggling channels — intensified following the arrest of a Supermicro co-founder earlier this year — has sharply curtailed supply without dampening appetite.thenextweb

Reuters reported in April that monthly rental prices for B300 servers in China reached as high as 190,000 yuan, further illustrating the extreme compute scarcity facing Chinese AI firms.reuters

Nvidia Stock Under Pressure

Nvidia shares fell more than 4% on Tuesday to around $200, extending a roughly 3% decline over the past month. The drop came amid a broader technology selloff driven by rising expectations of Federal Reserve rate hikes, but was compounded by the black-market report and ongoing uncertainty about the company’s China revenue prospects.cnbc

Nvidia has yet to generate meaningful revenue from H200 sales to China despite U.S. government approval of export licenses, with the company acknowledging in May that it remains unclear whether any imports will ultimately be permitted.instagram