The administration of U.S. President Donald Trump is reportedly considering imposing tighter restrictions on Nvidia’s (NVDA.O) sales of its H20 chips to China, according to sources familiar with the matter. The move could further escalate tensions in the ongoing U.S.-China tech battle.

According to a Reuters report, discussions on restricting shipments of these chips are still in the early stages among Trump officials. The idea, however, has been under consideration since the administration of former Democratic President Joe Biden.

Nvidia’s H20 chips were specifically designed to comply with the U.S. export controls imposed during Biden’s tenure. These chips are capable of running artificial intelligence (AI) software and were intended to navigate existing curbs on high-tech exports to China. However, if new restrictions are implemented, they could significantly impact Nvidia’s business in the Chinese market.

This move follows years of aggressive measures by Washington to curb China’s access to advanced computing technology, citing national security concerns.

Under President Biden, the U.S. intensified its semiconductor restrictions, imposing strict export controls on AI chips and blacklisting over 140 Chinese companies, including major firms like Naura Technology Group. The administration also targeted key players such as "Tencent" and "CATL", citing alleged military ties, and pressured allies like Japan and the Netherlands to limit exports of advanced chip-making equipment to China.

Nvidia, a central figure in this conflict, has recently spoken out against Biden’s new “AI Diffusion” rule, warning that such regulations threaten global innovation and could undermine decades of U.S. leadership in computing and software. The company argues that restrictive policies not only impact American businesses but also risk weakening the nation’s technological influence.

China’s Countermeasures

In response, China has taken steps to counteract U.S. sanctions by restricting exports of critical semiconductor materials such as gallium and germanium—essential elements in chip manufacturing. These moves have disrupted global supply chains, adding new challenges for the tech industry.

At the same time, Chinese firms have been stockpiling foreign chip-making equipment and strengthening domestic semiconductor production to reduce reliance on Western technology. Beijing has doubled down on its efforts to build a self-sufficient chip industry, forming new alliances and investing heavily in research and development.

A Prolonged Tech Battle with No End in Sight

With the Trump administration now considering even stricter controls on Nvidia’s AI chip exports, the semiconductor war between the U.S. and China is far from over. Each side continues to escalate measures, fueling tensions that could reshape the global tech landscape for years to come.