Chinese Developed Own AI Chip US-China Trade War Set to Intensify

China’s AI Chip Move Signals the Ongoing US-China Trade War

The ongoing trade war between the United States and China continues to intensify, with the latest development coming from China’s tech giant, Huawei Technologies. Huawei is preparing to test its new and powerful AI processor, which is expected to rival high-end chips produced by the American company Nvidia. This move further highlights the growing technological rivalry between the two nations. According to reports from the Wall Street Journal, Huawei is already in discussions with several Chinese tech firms about testing this new chip, which is named the Ascend 910D.

The launch of the Ascend 910D is seen as a critical step for Huawei as it aims to strengthen its position in the AI chip market, an area where Nvidia currently holds a significant advantage. Industry insiders believe that this new chip could outperform Nvidia’s H100 chip, which is widely regarded as one of the most advanced AI processors available. Huawei hopes that the Ascend 910D will become a major player in the global AI chip market and provide Chinese companies with a homegrown alternative to Nvidia’s products.

The Ascend 910D: Huawei's New AI Chip

Huawei’s Ascend 910D chip is expected to be an upgrade from its earlier versions, the 910B and 910C. These earlier models were already being tested and deployed in some sectors, but the 910D aims to take things to the next level. Sources familiar with the project indicate that the 910D is still under development and will need to undergo several rounds of testing before it is ready for mass production and distribution. However, Huawei is confident that the new chip will be ready for commercial use by late May 2025.

According to reports from Reuters, Huawei plans to send out its advanced 910C AI chip to Chinese customers as soon as next month. This move is significant, as it underscores China’s determination to develop its own technological capabilities, particularly in areas like AI and semiconductor manufacturing, where it has long relied on foreign companies like Nvidia.

Nvidia’s Role in the US-China Trade War

Nvidia is at the center of the ongoing technology and trade issues between the United States and China. As one of the world’s leading chipmakers, Nvidia plays a crucial role in the competition for AI technology supremacy between the two nations. The company has become an essential supplier of advanced AI chips to Chinese tech giants, including Tencent, Alibaba, and ByteDance (the parent company of TikTok). These companies have placed significant orders for Nvidia’s H20 chips, which are crucial for their AI-driven applications.

However, the US government’s recent decision to impose stricter export controls on advanced semiconductor technology has put Nvidia in a difficult position. The new export rules aim to limit China’s access to cutting-edge technology that could potentially be used in military applications. The US government hopes that these restrictions will slow China’s progress in developing advanced AI capabilities and maintain its technological advantage in the field.

The impact of these export controls on Nvidia has been significant. The company has already warned that it stands to lose around $5.5 billion in revenue due to orders it can no longer fulfill as a result of the new restrictions. This loss underscores the financial implications of the US-China trade war, as well as the growing tensions over technology and intellectual property rights.

Impact on the Cryptocurrency Market

The export ban on Nvidia chips has also had a ripple effect on the cryptocurrency market. Nvidia’s chips are widely used in the mining of cryptocurrencies, particularly those that rely on AI algorithms for their consensus mechanisms. The restrictions on Nvidia’s chip exports have led to a reevaluation of AI-related investments in the crypto space, particularly with regard to tokens associated with AI technology.

One such token is Nvidia’s own cryptocurrency, NVDA Coin, which has seen significant volatility as a result of the export restrictions. Other AI-focused cryptocurrencies have also experienced fluctuating prices as traders react to the uncertainty surrounding the supply of advanced AI chips. This volatility presents both risks and opportunities for cryptocurrency traders, particularly those involved in high-frequency trading of AI-related tokens.

As the US government seeks to curb China’s access to advanced technology, the global tech ecosystem is facing increasing fragmentation. The development of AI chips, in particular, has become a focal point of competition between the two largest economies in the world. The outcome of this competition could have far-reaching consequences for the future of AI technology, as well as for global trade and economic relations.

The Broader Implications for US-China Relations

The US’s decision to impose export controls on AI chips is part of a broader strategy to reduce dependence on China for advanced technology and to bring semiconductor manufacturing back to the United States. This shift in policy reflects the growing concerns in Washington about China’s rising technological capabilities and the potential security risks associated with the country’s access to sensitive technologies.

In response to these concerns, Nvidia has announced plans to invest up to $500 billion in the development of AI servers within the United States. This move is seen as part of the company’s efforts to align itself with US government priorities and to ensure that it can continue to thrive in the evolving global tech landscape. President Donald Trump has also claimed that his re-election bid influenced Nvidia’s decision to invest heavily in the US market.

Similarly, Taiwan Semiconductor Manufacturing Company (TSMC), one of the world’s largest chipmakers, has announced plans to invest an additional $100 billion in new manufacturing facilities in Arizona. This investment is seen as a direct response to the increasing pressure from the US government to bring more semiconductor production to American soil.

The Future of Global Technology Divisions

The ongoing trade war between the US and China is likely to have a lasting impact on the global technology landscape. As both countries seek to assert their dominance in critical areas like AI and semiconductor manufacturing, the technology ecosystem is becoming more divided. The global supply chain for advanced technology is being reshaped, with countries increasingly seeking to secure their own access to key technologies and reduce their reliance on foreign suppliers.

This fragmentation of the global tech ecosystem raises important questions about the future of international collaboration and the potential for technological innovation. As trade barriers and export restrictions become more common, it may become increasingly difficult for companies to access the best technologies from around the world. This could slow the pace of technological progress and limit the potential for cross-border innovation.

When Will the US-China Trade War End?

The trade war between the US and China has had a profound impact on global markets, disrupting supply chains and stoking fears of a potential recession. Both countries have imposed record tariffs on each other’s goods, and tensions continue to escalate. Despite these challenges, some analysts believe that the trade war may soon de-escalate, as both sides seek to find a way to avoid further economic damage.

US Treasury Secretary Janet Yellen has stated that the trade standoff between Washington and Beijing is not sustainable in the long term. She predicts that the current tariff war will eventually de-escalate, as both sides realize the need to reach a resolution that minimizes the impact on global markets and the economy.

While it is unclear when the trade war will come to an end, the ongoing technological competition between the US and China is likely to continue for the foreseeable future. As both countries seek to assert their dominance in key areas like AI and semiconductor manufacturing, the global tech ecosystem will remain deeply divided, with far-reaching implications for trade, investment, and innovation.

Conclusion

The ongoing technological rivalry between the US and China is a critical aspect of the broader trade war between the two countries. With Huawei’s new Ascend 910D AI chip and Nvidia’s efforts to navigate US export controls, the competition for AI supremacy is heating up. As the trade war continues to unfold, the global technology landscape is becoming increasingly divided, with both countries striving to secure their positions as leaders in cutting-edge technologies. The outcome of this battle will have significant implications for the future of AI, the cryptocurrency market, and global trade relations.

Source: CoinWar

Writer @Erlin

Erlin is an experienced crypto writer who loves to explore the intersection of blockchain technology and financial markets. She regularly provides insights into the latest trends and innovations in the digital currency space.

 

 Check out other news and articles on Google News

Disclaimer:

The articles published on hokanews are intended to provide up-to-date information on various topics, including cryptocurrency and technology news. The content on our site is not intended as an invitation to buy, sell, or invest in any assets. We encourage readers to conduct their own research and evaluation before making any investment or financial decisions.

hokanews is not responsible for any losses or damages that may arise from the use of information provided on this site. Investment decisions should be based on thorough research and advice from qualified financial advisors. Information on HokaNews may change without notice, and we do not guarantee the accuracy or completeness of the content published.