China’s DeepSeek trained AI model on Nvidia’s best chip despite US ban, official says

WASHINGTON: Chinese AI startup DeepSeek’s latest AI model, ​set to be released as soon as next week, was trained on Nvidia’s most advanced AI chip, the Blackwell, a senior Trump administration official said on Monday, in what could represent a violation of US export controls.
The US believes DeepSeek will remove the technical indicators that might reveal its use of American AI chips, the official said, adding that the Blackwells are likely clustered at its data center in Inner Mongolia, an autonomous region of China.
The person declined to say how the US government received the information or how DeepSeek obtained the chips, but emphasized that US policy ‌is :“we’re not shipping ‌Blackwells to China.”
Nvidia declined to comment, while the Commerce Department and ​DeepSeek ‌did ⁠not respond ​to ⁠requests for comment.
The Chinese embassy in Washington said Beijing opposes “drawing ideological lines, overstretching the concept of national security, expansive use of export controls and politicizing economic, trade, and technological issues.”
The news, not previously reported, could further divide Washington policymakers as they struggle to determine where to draw the line on Chinese access to the crown jewels of American AI semiconductor chips.
China hawks fear chips could easily be diverted from commercial uses to help supercharge China’s military and threaten US dominance in AI.
But White House AI ⁠Czar David Sacks and Nvidia CEO Jensen Huang argue that shipping advanced ‌AI chips to China discourages Chinese competitors like Huawei ‌from redoubling efforts to catch up with Nvidia’s and AMD’s technology.
US ​export controls, overseen by the Commerce Department, currently ‌bar Blackwell shipments to China.
In August, US President Donald Trump opened the door to Nvidia ‌selling a scaled-down version of the Blackwell in China. But he later reversed course, suggesting the firm’s most advanced chips should be reserved for US companies and kept out of China.
Trump’s decision in December to allow Chinese firms to buy Nvidia’s second most advanced chips, known as the H200, drew sharp criticism from China ‌hawks, but shipments of the chips remain stalled over guardrails built into the approvals.
“Chinese AI companies’ reliance on smuggled Blackwells underscores their massive ⁠shortfall of domestically produced ⁠AI chips and why approvals of H200 chips would represent a lifeline,” said Saif Khan, who served as director of technology and national security at the White House’s National Security Council under former President Joe Biden.
The official declined to comment on how the latest news would impact the Trump administration’s decision on whether to allow DeepSeek to buy H200s.
The model they helped train likely relied on the “distillation” of models made by leading-edge US AI companies, including Anthropic, Google, OpenAI, and xAI, echoing allegations made by OpenAI and Anthropic, the official added.
The technique known as distillation involves having an older, more established and powerful AI model evaluate the quality of the answers coming out of a newer model, effectively transferring the older model’s learnings.
Hangzhou-based DeepSeek shook markets early last ​year with a set of AI models that ​rivaled some of the best offerings from the US, fueling concerns in Washington that China could catch up in the AI race despite restrictions.