TSMC Insider Threat: Six Arrested in Taiwan Over 2nm Chip Trade Secrets

In a stunning development, Taiwanese authorities have arrested six individuals suspected of stealing trade secrets from Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s most advanced semiconductor producer. At the heart of the case is TSMC’s 2-nanometer (2nm) chip technology, a crown jewel in the global race for next-generation AI and high-performance computing power.

This marks the first major prosecution under Taiwan’s 2022 National Security Act, underscoring the escalating risk of insider threats and economic espionage in the semiconductor industry. Prosecutors are investigating whether the stolen technology was funneled to outside entities — a potential national security risk with global repercussions.

This episode examines:

• TSMC’s global dominance, producing over 90% of the world’s advanced chips, and why its 2nm technology is considered a strategic asset for AI, defense, and global tech leadership.
• The insider threat problem: how current and former employees allegedly bypassed TSMC’s defenses and why the semiconductor industry has become a prime target for espionage.
• China’s aggressive pursuit of chip technology, with trade secret theft playing a central role in its strategy to achieve semiconductor independence.
• The broader landscape of semiconductor espionage, from Google and Apple to Samsung and SK hynix, highlighting the billions lost annually to IP theft.
• Taiwan’s robust countermeasures, including AI-driven monitoring systems and strict new laws carrying up to 12 years in prison for offenders.
• The U.S. response, from the CHIPS and Science Act to export controls and supply chain diversification, as Washington seeks to reduce reliance on Taiwan while maintaining chip access.
• The geopolitical stakes, as the world’s economic security becomes increasingly tied to Taiwan’s semiconductor output — making any disruption a potential global crisis.

With the semiconductor market projected to hit $654.7 billion by 2025, and AI fueling unprecedented demand, this case shines a harsh light on the intersection of economic power, national security, and insider espionage. The outcome could shape global tech competition for years to come.

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