How Megaspeed built a network in Singapore and Malaysia to move $7.5 billion of Nvidia chips to Chinese companies

Detailed summary

Experts say the company’s actions show how Chinese firms rely on Southeast Asia to skirt U.S. trade controls.

The chip-smuggling controversy swirling around Nvidia centers on one company: Megaspeed, a Singapore-based cloud computing provider that, according to several media reports, is suspected of funneling advanced AI processors to Chinese companies.

While details of what Megaspeed is alleged to have done remain murky, experts say the case shows how Chinese firms rely on Southeast Asia to skirt U.S. trade controls.

“Chinese firms can access data centers in Singapore and Malaysia—and their computing capacity—without having to import restricted semiconductors,” Ja Ian Chong, a political science expert from the National University of Singapore (NUS), tells Fortune. “But the ease of shipping [chips] through Singapore and Malaysia also makes them attractive for firms and people who wish to circumvent U.S. controls.”

Washington restricts the export of Nvidia’s top-end Blackwell and Rubin chips to China, out of fear Beijing could use them to supercharge its AI ambitions.

According to The Information, Alice Huang, an executive at Megaspeed, used her personal relationship with Nvidia CEO Jensen Huang to move at least $7.5 billion worth of Nvidia chips through Megaspeed and its Malaysian subsidiary, Speedmatrix.

Singapore says it is investigating Megaspeed for “suspected breaches of our domestic laws,” but it separately rejected reports that its authorities were investigating Alice Huang over the espionage allegations. U.S. officials had also been investigating Megaspeed for potential export-control violations.

Megaspeed has denied wrongdoing; Nvidia has previously claimed that it found no evidence of illicit chip transfers.

Nvidia’s board said in a Nov. 8 statement that it was initiating an independent investigation into whether Huang was the target of a foreign intelligence effort, though it added it had no reason to believe “either national security or NVIDIA secrets were compromised.” The board said it “prioritizes U.S.

Following reports that Huang conducted a second affair, this time…

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