Trump Suggests Allowing Scaled-Down Nvidia AI Chips Sales to China Amid Security Concerns

U.S. President Donald Trump signaled on Monday that he may permit Nvidia to sell a reduced-performance version of its next-generation Blackwell AI chips in China, raising alarms in Washington about Beijing’s potential access to cutting-edge computing power.

Trump told reporters that Nvidia CEO Jensen Huang had discussed a “somewhat enhanced-in-a-negative-way Blackwell,” explaining it would carry 30–50% less computing power than the U.S. flagship model. “That will be an unenhanced version of the big one,” Trump said, suggesting the proposal remains under review.

The Trump administration also confirmed an unprecedented deal with Nvidia and AMD that requires them to give the U.S. government 15% of revenue from China chip sales. The move follows last month’s approval for Nvidia’s H20 chips, a lower-performance variant developed under Biden-era export restrictions, to resume shipping to China.

Security experts warn the policy could still advance Beijing’s AI capabilities. Saif Khan, a former White House tech security director, cautioned that China could buy enough scaled-down Blackwell chips to build frontier-level AI supercomputers, potentially leapfrogging U.S. progress.

Currently, the H20 is the most advanced chip allowed for Chinese markets, though Trump called it “obsolete,” noting Beijing already has access. Nvidia unveiled its flagship Blackwell chip in March, boasting performance up to 30 times faster than its predecessor.

While Nvidia has not confirmed a China-only Blackwell variant, Reuters reported in May that a lower-cost, scaled-down version was being prepared. China’s foreign ministry did not immediately comment.

Meanwhile, critics highlight Trump’s unusual interventions in corporate strategy, from demanding revenue-sharing to pressuring Intel’s CEO Lip-Bu Tan to resign over his ties to Chinese firms. The Commerce Department has begun issuing licenses for H20 exports, insisting national security remains safeguarded.

Nvidia and AMD both stated they will comply with U.S. rules, while China has accused Washington of using tech restrictions to “maliciously contain and suppress” its development.