As the USA and China face off over high-tech export

In the global context of technology, the tracking of Nvidia and AMD chips has become one of the most controversial aspects in the competition between Washington and Beijing.

The United States, determined to protect its know-how on advanced semiconductors, has begun to implement invisible surveillance systems directly embedded in microchips destined for the Chinese market, with the aim of preventing the leakage of strategic technologies.

According to data collected by cybersecurity and technology sector experts, these measures represent one of the most advanced forms of control in the history of the electronic supply chain.

This strategy has provoked a reaction from Beijing, which has strengthened its internal restrictions, accelerated the development of national standards, and intensified support for the domestic industry.

Why China fears microchips with USA tracking

The hidden electronic monitoring in chips produced by Nvidia and AMD heightens tensions in the geopolitics of semiconductors.

The Chinese government perceives such mechanisms as a threat to Chinese digital autonomy: the tracking, in fact, would allow constant surveillance over information and industrial uses, effectively limiting freedom of action in technological choices and investments.

According to industrial sources cited by Reuters, the main concern is the impact on crucial projects in the defense sectors, artificial intelligence, and critical infrastructure.

The new USA moves: how the high-tech block towards Beijing works

Recently, Washington has tightened controls on the export of advanced chips. The main initiatives adopted include:

• The sending of some high-end microchips to China with secret tracking systems, designed to detect any illicit transfers to prohibited areas.
• The monitoring by American agencies of trade flows, aimed at identifying parallel channels that bypass restrictions, with the goal of limiting the spread of top-of-the-line chips for artificial intelligence.
• The obligation for leading companies, such as Nvidia and AMD, to adhere to new procedures to avoid sanctions.

Beijing’s response was not long in coming: a directive was issued inviting to limit the use of US chips, particularly those Nvidia H100 (excluding H20 models), and to encourage the “national champions” in the electronics sector.

Effects and pressures of the US block on the chip giants

More restrictive export policies have evident impacts on the global technology industry. Below are some effects reported by analysts:

• China represents a fundamental market, contributing approximately between 15% and 20% of the revenue for companies like Nvidia and AMD, even though this share has decreased due to renewed restrictions.
• The intensification of regulations has forced Nvidia and AMD to sign additional agreements with the USA authorities for each shipment to China.
• Despite the obstacles, Beijing continues to represent a pivotal point in the global demand for high-performance semiconductors.

“Leaving the Chinese market compromises our ability to innovate globally and weakens the overall competitiveness of the United States,” emphasized Jensen Huang, CEO of Nvidia, during a conference call held in May 2025 (Reuters).

Invisible surveillance systems: how real is the threat?

The topic of spy chips divides opinions among experts and public authorities. Internal U.S. documents confirm the use of secret hardware controls.

Meanwhile, Beijing has refined its response: independent laboratories are conducting thorough checks on imported products to prevent unauthorized digital intrusions.

At the same time, several large Chinese companies active in artificial intelligence are accelerating the production of customized chips to avoid dependence on the U.S. technology chain.

The Chinese counteroffensive: stop to Made in USA chips?

In a context of increasing international tension, the Chinese strategy in the semiconductor sector has become more determined. Among the main elements of the new directives:

• Greater economic support for national producers, including a state fund of about 47.5 billion dollars planned for 2024.
• Increase in investments in research and development of alternative technologies, also through regional collaborations.
• Introduction of mandatory technical inspections on all microchips imported from Western manufacturers.

The objectives include reducing dependence on supplies such as those from Nvidia, AMD, and other US leaders, and redefining China’s role in the global value chain (American Affairs Journal).

The new golden rules: the United States rewrites chip export control

The American strategies to maintain technological supremacy expand on various fronts:

• Introduction of the requirement for prior authorization for any shipment of the latest generation semiconductors to entities defined as “at risk”.
• Application of additional tariffs and stricter controls at customs on particularly sensitive components.
• Continuous surveillance, with 24-hour digital monitoring, on selected categories of microchips intended for artificial intelligence and big data analysis.

According to industry analysts, this new regulation aims to protect about 90% of the global production of advanced semiconductors, data referred to December 2024. Source: summary from Reuters analysis and documents from the US Department of Commerce (Covington & Burling LLP).

The global market in the era of electronic surveillance: who pays the price?

Uncertainty dominates among hi-tech multinationals, called to reorganize in a scenario characterized by risks of blockages and the need for constant innovation.

Industry analysts observe that the cross-checks between the USA and China are profoundly changing the conditions of access to critical resources, creating uncertainties for startups and large technological projects.

Export, secret agreements, and rule changes: the new chip game

A significant element concerns the special export agreements between US multinationals and government institutions. According to confidential information:

• Nvidia and AMD have agreed on a mandatory deduction of up to 15% on sales in China, as a security measure for maintaining export licenses.
• This system, subject to federal supervision, ensures transparent control and represents a deterrent against illegal distribution (Reuters).

In the meantime, China continues to seek solutions to reduce dependence on U.S. technologies and standards, aiming for an increasingly competitive and resilient national industry.

Inspections and investigations: the hunt for spy microchips in China has already begun

Among the most evident effects is the establishment of internal Chinese task forces dedicated to detecting any unauthorized monitoring systems in chips intended for artificial intelligence and defense.

The technical inspections that have begun, according to local sources, have pushed companies to develop innovative countermeasures, aimed at evading possible intrusions and strengthening national cybersecurity.

Chip, export, and technology war: where is the digital West heading?

The semiconductor sector is increasingly shaping up as the fulcrum of a new global technological tension. Export restrictions and electronic tracking systems are key tools in geopolitical confrontations.

Only time will tell which power will succeed in guiding developments and internationally shared rules. Currently, innovation and security are subject to tighter and constant scrutiny.

Note: The most up-to-date quantitative data will be available with the release of the next quarterly reports. It is suggested to consult specialized industry sources and the latest Reuters reports to monitor the ongoing evolution (Reuters).