Nvidia's Trojan Chip Trips China's Alarms as US Turns Up the Heat

This is your US-China CyberPulse: Defense Updates podcast.

Listeners, Ting here—with your daily download of US-China CyberPulse: Defense Updates. Buckle up, because if the past week has shown us anything, it’s that the digital chessboard between Washington and Beijing is more cutthroat and complex than ever.

Let’s get right into it. Over the last week, US cybersecurity measures against Chinese threats have gone into overdrive, and you can practically see the firewall smoke on both sides of the Pacific. Right at the center are American export controls—especially chips. Just as Nvidia’s H20 chip, built specifically for China after rigid US bans, landed, Chinese state media blasted it as a national security risk, warning about backdoors and “kill switches.” The US, meanwhile, doubled down with lawmakers floating requirements that American chipmakers embed asset tracking in exports to catch black-market reroutes. Nvidia’s Chief Security Officer David Reber Jr. is practically shouting from the rooftops that building such tracking—or kill switches—into chips would be a boon for hackers everywhere and undermine global trust, but Washington seems determined to keep tabs on every GPU that leaves the country.

Talk about irony—ten years ago Washington was warning everyone that Huawei hardware would be a fifth column, but now Beijing is warning its own agencies not to get caught using the American chips, especially for anything close to government work. And the skepticism flows both ways. Last week, Trump’s team gave the green light for downgraded AI chips to resume shipping to China, but CNN reports that instead of rolling out the red carpet, China called in Nvidia execs behind closed doors and grilled them on whether these “lower-spec” chips are Trojan horses for American surveillance. Chinese officials are on high alert, warning of possible shut-down features and remote tracking. US lawmakers, meanwhile, push on with new bills aimed at updating ancient export control IT systems and reinforcing digital walls—sometimes it feels like Congress is trying to build a sandcastle against the tide.

On the bleeding edge, let’s talk private sector defenses and fancy new tech. The past seven days saw a perfect storm of zero-day exploits—think major vulnerabilities in platforms like FortiSIEM, and coordinated attacks by criminal supergroups blending ShinyHunters and Scattered Spider’s powers, according to FireCompass. For context, ShinyHunters is to data leaks what Paul Revere was to midnight rides. This means AI-powered automated penetration testing is now racing from buzzword to boardroom must-have—companies are deploying algorithms that never sleep, hunting for weaknesses before the bad guys do.

Internationally, the US keeps dialing up collaboration. There’s been a big call for allied nations to boost intelligence sharing on notorious groups like Volt Typhoon—a Chinese state-backed crew that’s become infamous for infiltrating critical US infrastructure, particularly utilities. In July alone, one California water system fielded over 6 million suspicious hits from China-linked sources, as FalconFeeds.io flagged.

On the policy side, DHS just ramped up scrutiny too, adding new Chinese sectors—steel, lithium, copper—to the Uyghur Forced Labor Prevention Act enforcement list. Secretary Kristi Noem made it clear: forced labor, unfair trade, and anything that undermines America’s economic or national security is getting extra heat. This is all about supply chain integrity—mapping and auditing every component, especially for sectors where Chinese tech or minerals are baked into the infrastructure.

Layer in a regional flavor—CSIS this week pushed for a North American supply chain security mechanism, pushing the US, Canada, and Mexico to jointly police and verify digital and physical trade routes for knockoff, rebranded, or cyber-compromised goods that could trace back to...