U.S. to Blacklist Chinese Company Sophgo for Ties to Huawei AI Chip Scandal

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The U.S. government is taking serious action against Chinese chipmaker Sophgo after its involvement in a Huawei AI processor scandal. This move comes as the Biden administration cracks down on companies helping Huawei bypass U.S. restrictions. Here’s what you need to know about the latest tech clash between the U.S. and China.

Sophgo’s Chip Found in Huawei AI Processor

Sophgo, a Chinese chip designer with ties to Bitcoin mining equipment supplier Bitmain, is under the U.S. government’s radar. A recent investigation found that a chip made by Taiwan Semiconductor Manufacturing Company (TSMC) for Sophgo was found in Huawei’s Ascend 910B AI processor.

This processor is part of Huawei’s advanced AI systems, and the discovery raised alarms in Washington.

The U.S. Department of Commerce is now pushing to blacklist Sophgo, placing it on the Entity List, a restricted trade list. Being on this list would prevent Sophgo from receiving U.S. technology and components. 

Sophgo Denial of Ties to Huawei

Even though the chip was found in Huawei’s system, Sophgo denied having any business with Huawei. In an earlier statement, the company said it never had any connection with the Chinese telecom giant.

But the U.S. government remains skeptical, especially after the chip was found in Huawei’s products.

Sophgo’s Work with Chinese Entities

Beyond its relationship with Huawei, Sophgo is deeply involved with Chinese state-owned entities. The company supplies AI chips to local government agencies, including police stations, which use the chips for surveillance technology. 

Sophgo’s role in China’s growing surveillance state has raised concerns among U.S. officials about the potential for these chips to be used in ways that could undermine national security.

TSMC Suspends Shipments to Sophgo

Following the discovery TSMC, which has long been a supplier to Huawei, confirmed that the chip matched Sophgo’s design and confirmed that it would no longer ship to Sophgo. 

The Taiwanese chipmaker had already halted shipments to Huawei in 2020, but the latest issue shows how companies can still get important chips in other ways.

U.S.-China Tech War Intensifies

The Sophgo case is just the latest chapter in the ongoing U.S.-China tech rivalry. As the U.S. seeks to maintain its edge in fields like AI, 5G, and semiconductors, it is using sanctions and trade restrictions to prevent Chinese companies from accessing advanced technology.

By blocking companies like Sophgo, the U.S. hopes to slow China’s progress in these critical areas.