32 Banned Nvidia B300 GPUs Found Inside China Telecom Network

Israeli security firm Lava has identified 32 Nvidia Blackwell Ultra B300 GPUs running inside the network of China Telecom, the state-owned telecom carrier — chips that U.S. export controls bar from sale to Chinese buyers. The Information first reported the finding.

The B300 falls under strict export rules. Nvidia may sell it only to whitelisted buyers who commit not to resell to sanctioned parties, including those in China. How 32 of them ended up in China Telecom's server racks is the open question, and Lava can't answer it: the firm cannot pinpoint the chips' physical location, only confirm they exist on the network.

How were the chips detected?

Lava found them through Nvidia's own DCGM Exporter tool. Data center operators install the software to monitor server health and performance, and while it's designed for internal use, it's often reachable beyond the data center's own network. It doesn't always require password authentication, either. That gap turned a monitoring utility into a detection vector.

Nvidia has previously confirmed it's building a tool to locate its chips. It hasn't shipped yet.

What does Nvidia say?

The company downplayed the report but did not deny the findings. "Governments, researchers, and media have all found insignificant diversion of controlled US products, less than one half of one percent in recent court cases — a drop in the bucket compared to the ocean of domestic compute China already has," an Nvidia spokesperson told Tom's Hardware. "With tens of millions of GPUs in service in approved countries, this report again demonstrates that smuggling is a nonfactor, blocked by governments on both sides of the globe."

The numbers behind the spin are still significant. In 2025, reports surfaced that Chinese companies smuggled $1 billion worth of Nvidia AI chips into the country in just three months. The B200 (the B300's predecessor) was the most sought-after chip at the time, but distributors were already preparing to sell B300-series parts as soon as they became available.

Why do buyers want the B300?

Announced in March last year, the Blackwell Ultra B300 is among the most powerful data center GPUs on the market. It delivers 50% more memory and 50% more FP4 compute (low-precision AI number format) than the B200. Nvidia marketed it as "built for the age of reasoning" and name-checked large language models like DeepSeek R1. At launch, Nvidia expected the chip to ship by the end of 2025.

It became contraband almost immediately. In August 2026, nine people were indicted in Taiwan over the illegal export of B300 GPUs to China. Days earlier, Supermicro confirmed it had fired several employees after a smuggling investigation. The scheme ran through a Taiwanese server trading firm, Flying Tiget Tech, which held whitelisted status for GPU purchases.

What does this change for the market?

The enforcement picture is messy, and demand keeps outrunning the rules. Scarcity has pushed prices for even Nvidia's older silicon to extreme levels: A100 servers have tripled in price despite being five years old, now costing up to $82,000. The crackdown has also pushed some operators to retool gaming GPUs for AI workloads where possible.

For Nvidia, 32 chips is a rounding error across tens of millions of installed GPUs. For U.S. export regulators, it's another data point that whitelisting and end-user commitments leak — and that monitoring tools meant for internal use are now doing double duty as evidence.