The Morning Risk Report: China's AI Engineers Are Secretly Accessing Banned Nvidia Chips
Good morning. Chinese artificial-intelligence developers have found a way to use the most advanced American chips without bringing them to China.Getting around export controls. Chinese developers are working with brokers to access computing power overseas, sometimes masking their identity using techniques from the cryptocurrency world. The tactic comes in response to U.S. export controls that have prevented Chinese companies from directly importing sought after AI chips developed by U.S.-based Nvidia. While it is still possible for Chinese users to physically bring Nvidia's chips to China by tapping a network of gray-market sellers, the process is cumbersome and can't supply all the needs of big users.A background in crypto. One entrepreneur helping Chinese companies overcome the hurdles is Derek Aw, a former bitcoin miner. He persuaded investors in Dubai and the U.S. to fund the purchase of AI servers housing Nvidia's powerful H100 chips. In June, Aw's company loaded more than 300 ser