China's Moonshot AI reportedly circumvented both US export controls and Chinese import restrictions to acquire Nvidia Blackwell chips for Kimi K3 model training.

Keeping the upper hand in the AI arms race has become a vital goal for both the U.S. and China, and Nvidia's Blackwell AI chips are one of many flashpoints in that fight. The U.S. government bars their sale to Chinese firms, while Chinese policies block their import as the country attempts to develop an advanced AI chip industry of its own. Yet Chinese AI firms have proven remarkably creative with workarounds for these restrictive policies.

Moonshot AI has reportedly made significant use of Blackwell chips for training the recently released Kimi K3 frontier-level model and is seeking additional access in preparation for Kimi K4. According to The Information, sources with knowledge of the matter stated that Moonshot employed two Chinese firms that possess Blackwell chips in their respective datacenters despite the bilateral restrictions. Given the extreme scarcity of these chips even when obtained legitimately, neither firm had sufficient inventory to support Moonshot's needs. This forced Moonshot to develop a system to join multiple eight-chip Blackwell servers together across datacenters in order to harness the necessary computing power.

A researcher at a major Chinese tech firm working on model training stated that Kimi K3 has "started a new round of arms race" in China's AI industry, adding that training frontier models is difficult or impossible with the country's homegrown chips. Chinese AI accelerators remain a generation or two behind Nvidia's current offerings and are reportedly several months on backorder.

For inference work, Moonshot relies on Nvidia's China-market HGX H20, a previous-generation chip not restricted by trade laws on either side of the Pacific. The firm recommends configurations with at least 64 H20 GPUs for running Kimi K3. These substantial requirements, combined with the model's popularity, caused Moonshot to quickly exhaust its computing capacity; the company currently maintains subscriptions on a waiting list. With Kimi K3 available as an open-weight model, other inference providers are now serving it, potentially alleviating capacity constraints.

White House Director Michael Kratsios claimed last week that Moonshot AI both "acquired GB300-equipped servers and has accessed GB300s in Thailand." While purchasing Blackwell chips is illegal, renting them remains permissible—at least until the proposed Remote Access Security Act takes effect. That legislation is designed to close the rental loophole by treating remote access as an export event, though enforcement across other jurisdictions remains unclear.

The Department of Commerce is formally investigating whether Chinese firms are accessing advanced U.S. chips like Blackwell GPUs, an issue likely to remain a point of ongoing contention as competition for frontier model supremacy intensifies. In China, it is an open secret that many of the country's leading AI players own or have access to Blackwell and other advanced chips. Despite extensive trade restrictions and official emphasis on domestic chips, the Chinese government has notably refrained from cracking down on these AI firms. Some observers theorize that this deliberate inaction allows Chinese companies like Moonshot to catch up to competitors such as Anthropic and OpenAI.