The H200 Gamble: What's Really Behind Trump's China Chip Talks?

The Setup

Trump’s Commerce Department is quietly exploring whether to greenlight Nvidia’s H200 sales to China. For context: H200 is roughly 2x the performance of the H20 chip currently allowed in the Chinese market. If this happens, it’s a seismic shift in U.S. tech export strategy—and Jensen Huang has been lobbying hard for exactly this outcome.

Why Now?

Two things converged: (1) Trump and Xi just reached a trade/tech truce in Busan weeks ago, signaling a potential thaw. (2) Nvidia’s China revenue is getting decimated by export restrictions in a market worth ~$50B today, potentially $200B by 2030. The company’s messaging is loud: current rules are strangling its competitiveness.

The Market Just Flinched

Asian markets reacted immediately. Chinese chipmakers like Cambricon, Hua Hong, and SMIC saw initial selloffs—traders pricing in competition from a more powerful Nvidia chip flooding the market. The fear: China’s domestic chip investments get undercut if the U.S. releases its best gear.

The Pushback

Bipartisan Senate hawks aren’t having it. A coalition is drafting legislation to force the Commerce Department to deny licenses for all restricted chips, basically locking in the current ban. National security hawks argue Nvidia’s H200 would turbocharge China’s military tech and AI capabilities.

The Real Tension

This reveals the core U.S. dilemma: ease up on China and let Nvidia compete globally, or maintain tech dominance through export controls? Meanwhile, the U.S. is doubling down elsewhere—committing 260k+ Nvidia chips to South Korea’s $10B AI infrastructure play. The message: “We can work with allies.”

Bottom Line

No final decision yet, but the fact this is even being considered signals cracks in export policy. Watch Senate legislation and Trump’s next move on Taiwan semiconductors—those two are linked.