Last updated on August 2, 2025
China: Nvidia stated on Thursday that its products do not contain any “backdoors” that could enable remote access or control, following security concerns raised by Chinese authorities over its H20 artificial intelligence chip.
China’s internet regulator, the Cyberspace Administration of China (CAC), expressed concern over a U.S. proposal suggesting that advanced chips sold internationally be equipped with tracking and location features. These developments have cast doubt over Nvidia’s business prospects in China, just weeks after the U.S. lifted a previous export ban on the H20 chip.
The CAC said it had summoned Nvidia to clarify whether the H20 chip poses any hidden security risks, especially those that could compromise user data and privacy. A backdoor refers to a concealed method of bypassing normal security measures.
In response, a Nvidia spokesperson said, “Cybersecurity is critically important to us. Nvidia does not have ‘backdoors’ in our chips that would give anyone a remote way to access or control them.”
U.S. policymakers — including the White House and both chambers of Congress — have proposed that U.S. chipmakers include location verification technology in chips sold abroad. However, no official regulation or technical standard has been enacted yet.
Nvidia remains a focal point in U.S.–China tech relations. The U.S. reversed its April ban on the H20 chip earlier this month. The chip was specifically designed for the Chinese market following tightened U.S. export restrictions on advanced AI chips in late 2023.
“Nvidia chips are now dispensable for China. They can be easily used as a bargaining tool,” said Tilly Zhang, an analyst at Gavekal Dragonomics. “China now has greater confidence and local capabilities compared to past years, reducing its reliance on foreign technology.”
Earlier this month, Nvidia CEO Jensen Huang made a high-profile visit to China, during which he met with officials, emphasized Nvidia’s dedication to the Chinese market, and praised the country’s progress in AI.
The CAC has not detailed what specific risks it sees or what actions it may take next.
High Demand Continues
Despite the concerns, demand for Nvidia’s chips remains strong in China. Charlie Chai, an analyst at 86Research, suggested Beijing’s move may be a symbolic response to similar national security claims by U.S. authorities. “We don’t expect overly harsh regulatory measures that would force Nvidia out of China, as viable alternatives remain limited,” he said.
Nvidia’s chips are widely used by Chinese tech firms, military organizations, research institutes, and universities. According to Reuters, Nvidia recently ordered 300,000 H20 chipsets from its contract manufacturer TSMC to meet strong demand.
U.S. tech firms have previously faced scrutiny in China over alleged security risks. In early 2023, China barred critical infrastructure operators from using Micron products after determining they posed “serious risks.” Last year, the Cybersecurity Association of China urged a review of Intel products, though regulators have yet to act publicly on that.
Nvidia is also under investigation by China’s State Administration for Market Regulation (SAMR) over suspected antitrust violations, including concerns related to its acquisition of Israeli chipmaker Mellanox Technologies, approved with conditions in 2020.
