US Chip Ban Backfires: China’s AI Chip Breakthrough in 18 Months Stuns Market
by New Rules [10-22-2025].
(RAD: This was predictable, except for myopic anti-China bureaucrats who never took the time to understand the rapid transformation of China!!! We have witnessed a similar advance in Russia after the West placed massive sanctions on Russia, which motivated them to develop needed technologies internally that they had previously purchased from the West. Both China & Russia have demonstrated that sanctions from the West don't work, although there might be some short term pain while they reconfigure. When will the US & the West learn that it is better for the entire world to find ways to coexist, instead of trying to destroy Russia & China??? — RAD)
The US sanctions of Oct 2022 were meant to cripple China's AI ambitions. Instead, they sparked an unprecedented industrial mobilization.
THE CATALYST:
US export controls became China's greatest motivator. The result: A self-sufficient semiconductor supply chain emerging at warp speed.
THE CONSEQUENCE:
Nvidia CEO Jensen Huang, Oct 2025: "We are 100% out of China. We went from 95% market share to 0%."
Let that sink in.
THE SHIFT:
🔸China was 20-25% of Nvidia's data center revenue
🔸Now: $0
🔸US just lost one of the world's largest AI markets
THE BIGGER PICTURE
China isn't just building chips—they're building an entire AI ecosystem:
🔸Dominant physical AI & robotics sector
🔸World-leading open-model ecosystem
🔸"Emerging export control regime" (Kyle Chan)
THE ENERGY ADVANTAGE
China's 2024 electricity output: 10,000 TWh
US output: Less than half
With superior renewable energy infrastructure, China's AI compute capacity could soon become unstoppable.
The Bottom Line
This could be the biggest strategic miscalculation in modern tech policy. By forcing China to innovate, the US may have created its own greatest competitor.
The AI arms race just entered a new phase.
Related
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China challenges America’s AI dominance [8-13-2025]
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NVIDIA CEO JENSEN HUANG DROPS BOMBSHELL ON US CHIP CURBS – ‘A TOTAL FAILURE!’ [5-21-2025]
The United States has ALREADY LOST the Tech Cold War against China [5-2-2025]