Blackwell Ultra B300 GPUs: Illegal Nvidia AI chips surface inside China Telecom network

Israeli security firm Lava has identified 32 Nvidia Blackwell Ultra B300 GPUs within the network of China Telecom, a state-owned telecommunications provider operating in China. The discovery highlights the persistent challenge of diverting restricted high-performance computing hardware into the country. Lava confirmed the presence of these specific processors using Nvidia's own DCGM Exporter tool, a software utility designed for monitoring server health and performance.

The discovery of these processors is significant because the B300 is subject to strict U.S. export controls. Regulations prohibit the sale of these chips to unauthorized buyers or to any party that intends to export them to sanctioned destinations, including China. The presence of these restricted units inside a state-owned Chinese entity indicates a breach of these protocols.

The method by which these chips entered the network remains unknown. Lava has stated that while they can confirm the chips are present, they cannot specify their exact location within China Telecom's infrastructure. The detection was made possible because the DCGM Exporter tool, while intended for internal data center use, can sometimes be accessed from outside the network. Lava noted that accessing this software does not always require password authentication.

Nvidia has responded to the report by downplaying the scale of the issue, though the company did not deny the specific findings regarding the 32 chips. A company spokesperson stated, "Governments, researchers, and media have all found insignificant diversion of controlled US products, less than one half of one percent in recent court cases — a drop in the bucket compared to the ocean of domestic compute China already has." The spokesperson added, "With tens of millions of GPUs in service in approved countries, this report again demonstrates that smuggling is a nonfactor, blocked by governments on both sides of the globe."

The issue of exporting restricted AI chips to China has been ongoing. In 2025, reports indicated that Chinese companies had smuggled $1 billion worth of Nvidia AI chips into the country within a three-month period. At that time, B200 chips were the primary target, though distributors were already preparing to distribute B300-series processors once they became available.

The Blackwell Ultra B300 is a highly sought-after data center GPU. Nvidia announced the chip in March 2025, describing it as "built for the age of reasoning." The hardware offers substantial performance improvements over the previous generation, boasting 50% more memory and FP4 compute capabilities compared to the B200. Production of the B300 was expected to begin by the end of 2025.

Attempts to illegally export these GPUs have recently led to legal consequences. In August 2026, nine individuals were indicted in Taiwan regarding the illegal export of B300 GPUs to China. This action followed Supermicro's confirmation that it had terminated several employees after investigating smuggling activities. The smuggling scheme involved a Taiwanese server trading firm, Flying Tiget Tech, which possessed whitelisted status for GPU purchases.

Despite export restrictions, Nvidia's silicon remains critical for AI development globally. Demand for Nvidia hardware is high enough that prices for older equipment have risen sharply. For example, five-year-old A100 servers have tripled in price and can cost up to $82,000. The crackdown on smuggling has also led some to attempt to repurpose gaming GPUs for AI workloads.

Nvidia has previously confirmed that it is developing a tool specifically designed to locate its chips. This software has not yet been released. The company's spokesperson asserted that the diversion of products is a non-factor, stating, "Governments, researchers, and media have all found insignificant diversion of controlled US products, less than one half of one percent in recent court cases — a drop in the bucket compared to the ocean of domestic compute China already has."