Chinese technology regulators have moved to restrict sales of Nvidia’s H20 artificial-intelligence chip after a senior U.S. official underscored Washington’s policy of limiting China to lower-tier semiconductors, the Financial Times reported. The H20, a cut-down version of the company’s H100 processor created to comply with U.S. export controls, had been cleared for shipment to Chinese customers as recently as July. Beijing’s latest order follows complaints from data-centre operators and security officials that the U.S.-made device could contain undisclosed backdoors. The scrutiny prompted Chinese authorities to tell some cloud providers to rely more heavily on domestically produced chips, further tightening already fragile supply lines. In response, Nvidia has instructed manufacturing partners, including Samsung and Amkor Technology, to pause production of the H20, PC Gamer reported. Demand for the product had reached roughly 700,000 units, highlighting China’s importance as the company’s second-largest market. Chief Executive Officer Jensen Huang said in Taipei that the company is in “active discussions” with Beijing and has “made very clear” that the chip has no security vulnerabilities, according to Nikkei Asia. Huang expressed confidence that the impasse can be resolved, but the dispute adds fresh uncertainty to Nvidia’s China strategy as geopolitical tensions around advanced AI hardware persist.