China Telecom's Network Contains Illegal Blackwell Ultra B300 GPUs

Illegal Nvidia Blackwell Ultra B300 GPUs have been found in the network of China Telecom, a state-owned company. This discovery comes despite U.S. export controls that have barred these chips from being sold to unauthorized buyers. Lava, an Israeli security firm, identified 32 of these chips within China Telecom's network, raising questions about how they bypassed export restrictions. Nvidia has downplayed the significance of the report, stating that smuggling represents a very small fraction of its total sales.

The presence of these high-performance GPUs in China Telecom's network highlights the ongoing challenge of controlling the flow of advanced technology to sanctioned countries. The B300 chips, which are among the most powerful on the market, were expected to be available by the end of 2025 but have since become highly sought after. In August 2026, nine people were indicted in Taiwan for illegally exporting B300 GPUs to China, showing the extent to which the demand for these chips has driven smuggling operations.

Nvidia's response to the issue suggests that the company believes the smuggling of its chips is a minor problem. The spokesperson stated that the diversion of controlled U.S. products is less than one half of one percent, calling it a drop in the bucket compared to the vast amount of domestic compute already available in China. Despite this, the discovery of these chips in China Telecom's network indicates that the export controls may not be as effective as intended.

The identification of these chips was made possible by Nvidia's own DCGM Exporter tool, which is used to monitor server health and performance. This tool, which is typically used internally, can sometimes be accessed beyond the data center's network and does not always require password authentication. This vulnerability may have played a role in how the illegal chips were able to enter the network.

The significance of this discovery is underscored by the fact that the Blackwell Ultra B300 is one of the most powerful GPUs on the market, offering significant performance gains over previous generations. Its importance to AI data centers has led to a surge in demand, with prices for older models like the A100 servers tripling despite their age. The continued smuggling of these chips highlights the challenges of maintaining control over advanced technology in an increasingly globalized market.