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US govt looking into whether DeepSeek beat export ban by getting advanced chips via S'pore: Bloomberg

Nvidia said shipments of its chips ultimately went to users outside of Singapore.

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January 31, 2025, 04:36 PM

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Officials in the Trump administration are trying to find out if DeepSeek, the Chinese AI company that took the tech world by storm with the release of its chatbot R1, went around export controls on advanced semiconductor chips by obtaining them through third-party suppliers.

Bloomberg, citing unnamed people "familiar with the matter", reported on Jan. 31, 2025 that officials within the White House and the Federal Bureau of Investigation (FBI) are trying to find out if DeepSeek used intermediaries in Singapore to purchase Nvidia chips, which the U.S. has blocked for export to China.

DeepSeek, based in Hangzhou, China, released an AI chatbot that wiped US$1 trillion (S$1.35 trillion) from tech stocks in a single day.

The reason? DeepSeek purportedly spent less than US$6 million on developing their chatbot, which appeared to work as well as other chatbots developed by companies like OpenAI, but had spent billions on their models.

They also supposedly did not use the most advanced chips produced by Nvidia, which called into question the efficacy of U.S. export controls of such chips.

Some in US don't believe DeepSeek's explanations

While DeepSeek's open source model is free for anyone to examine, and DeepSeek itself has given explanations for how it achieved its success, others still believe its latest product could not have been accomplished without the use of advanced chips.

The world's richest man and Trump administration tech czar Elon Musk has opined that it is "obvious" DeepSeek has access to advanced H100 chips, seen as vital for generative AI.

Howard Lutnick, Trump's pick to become Secretary of Commerce, blasted DeepSeek during his confirmation hearing, accusing it of buying "tons" of Nvidia chips.

Some are looking at Singapore

Some have cast their gaze at Singapore's direction, which is not subject to export controls on advanced Nvidia chips.

U.S. Congressman John Moolenaar (R-MI), Chairman of the Select Committee on the Chinese Communist Party and Congressman Raja Krishnamoorthi (D-IL), jointly wrote in an open letter to Trump's National Security Advisor Michael Waltz that a review should be done on strengthening controls on shipments through third countries that "pose a high risk of diversion":

"For example, Singapore represented 22 per cent of Nvidia’s revenue in its most recently quarterly statement, despite the company itself revealing most of these shipments ultimately went to users outside of Singapore.

Countries like Singapore should be subject to strict licensing requirements absent a willingness to crack down on PRC transshipment through their territory."

An Nvidia spokesperson told Bloomberg: "Our public filings report ‘bill to’ not ‘ship to’ locations of our customers.”

He said: “Many of our customers have business entities in Singapore and use those entities for products destined for the U.S. and the West."

The spokesperson also said "we insist that our partners comply with all applicable laws, and if we receive any information to the contrary, act accordingly."

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Top image via Pixabay.

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