China Telecom Network Runs 32 Nvidia Chips Banned by U.S. Law
Israeli security firm Lava identified 32 B300 processors in the state-owned carrier's infrastructure, a find that challenges current export control enforcement.
By Thomas Obasi ·
Three dozen Nvidia B300 graphics processing units are currently operating within the network of China Telecom. The discovery by Israeli security firm Lava was reported by The Information on Oct. 23. The chips belong to the Blackwell Ultra class, which U.S. export controls restrict to whitelisted buyers who agree not to sell to sanctioned parties, including entities in China.
Lava detected the hardware using Nvidia’s DCGM Exporter software. This tool is designed for data center operators to monitor server health. The firm noted that the software can often be accessed from outside the data center without a password. Lava did not specify the exact location of the chips within the Chinese state-owned carrier’s infrastructure.
Nvidia acknowledged the findings but minimized their impact. A company spokesperson told Tom's Hardware that recent court cases show diversion of controlled U.S. products is less than one half of one percent. The spokesperson described this volume as a drop in the bucket compared to the domestic compute capacity China already possesses. Nvidia stated that with tens of millions of GPUs in service in approved countries, smuggling remains a minor factor.
The B300 processor offers 50 percent more memory and FP4 compute power than the previous generation B200 chip. Nvidia introduced the hardware in March 2025 and described it as built for the age of reasoning. The chip targets sophisticated large language models such as DeepSeek R1. It was originally expected to ship by the end of 2025 and quickly became a high-demand item for buyers seeking advanced AI capabilities.
Enforcement actions have intensified in response to illegal exports. In August 2026, nine individuals were indicted in Taiwan for the illegal export of B300 GPUs to China. These indictments followed days after Supermicro fired several employees following an internal investigation into smuggling. The scheme involved a Taiwanese server trading firm called Flying Tiget Tech, which held whitelisted status for GPU purchases.
Market prices for Nvidia hardware have risen due to sustained demand. Servers built around the A100, a model from five years ago, have seen their prices triple. Some buyers are retooling gaming GPUs to run AI workloads as they navigate the continuing crackdown on smuggling.
