US probes DeepSeek’s potential use of restricted AI chips

DeepSeek, a Chinese AI company that recently launched a highly successful AI assistant, is under U.S. Commerce Department scrutiny regarding potential use of restricted AI chips.

The central development: The U.S. Commerce Department is investigating whether DeepSeek has accessed U.S.-manufactured AI chips that are currently restricted from being shipped to China.

• DeepSeek’s AI assistant launch created significant market impact, becoming the most downloaded app on Apple’s App Store
• The company’s success triggered concerns about U.S. AI leadership, contributing to a $1 trillion decline in U.S. technology stock values
• DeepSeek claims its AI model operates more efficiently than U.S. counterparts, using less data at reduced costs

Current restrictions and compliance: U.S. export controls specifically target Nvidia’s most sophisticated AI processors, preventing their shipment to China.

• Suspected AI chip smuggling routes have been identified through Malaysia, Singapore, and the United Arab Emirates
• Nvidia maintains that its customers must comply with applicable laws, particularly regarding Singapore-based business entities
• Singapore’s trade ministry has affirmed its commitment to upholding export control laws and collaborating with U.S. authorities

DeepSeek’s chip usage: The company’s hardware infrastructure includes both restricted and permitted Nvidia chips.

• DeepSeek has acknowledged using Nvidia H800 chips, which were legally purchasable in 2023
• The company also possesses Nvidia H20 chips, which currently remain legal for export to China
• The Biden administration has considered expanding restrictions to include H20 chips, with Trump appointees also discussing potential controls

Expert perspectives: Industry leaders have raised concerns about DeepSeek’s AI chip acquisition methods.

• Anthropic CEO Dario Amodei suggests DeepSeek’s chip fleet includes a mix of unrestricted chips, pre-ban purchases, and potentially smuggled components
• Questions remain about whether DeepSeek has accessed other controlled chips beyond their documented inventory

Strategic implications: This investigation highlights the complex challenges in enforcing AI chip export controls and maintaining technological advantages in the global AI race.

• The U.S. government continues to expand restrictions on AI chip exports to China and other countries
• The effectiveness of current export controls faces scrutiny as companies find potential workarounds
• The situation underscores the growing tension between technological advancement and national security concerns in the AI sector