Chinese regulators have begun discouraging domestic technology companies from buying Nvidia’s H20 artificial-intelligence chip after U.S. Commerce Secretary Howard Lutnick said Washington only allows China to purchase lower-tier semiconductors, remarks Beijing’s leadership deemed “insulting,” the Financial Times reported. People familiar with the matter said the Cyberspace Administration of China, the National Development and Reform Commission and the Ministry of Industry and Information Technology issued informal guidance in late July telling firms such as Alibaba and ByteDance to halt or scale back H20 orders while a national-security review proceeds. The move follows Lutnick’s 15 July television interview in which he added that the goal was to keep Chinese developers “addicted to the American technology stack.” The H20, a downgraded version of Nvidia’s high-end AI accelerators created to comply with U.S. export rules, had attracted fresh demand after Washington relaxed an April ban on its sale. The new Chinese curbs threaten that rebound and reinforce Beijing’s broader push to replace foreign chips with domestic alternatives from suppliers such as Huawei and Cambricon, underscoring the deepening tech rivalry between the world’s two largest economies.