Biden Administration to Blacklist Chinese Firm Over Illegal TSMC Chip Usage

The Biden administration is preparing to add the Chinese chip designer Sophgo to the U.S. Commerce Department's Entity List, according to a source close to the matter. Sophgo, a subsidiary of Bitcoin mining equipment provider Bitmain, has been linked to the illegal use of a chip produced by Taiwan Semiconductor Manufacturing Corp. (TSE: TSMC) in Huawei’s artificial intelligence processor.

The move to blacklist Sophgo comes after it was discovered that the company ordered a chip identical to the one used in Huawei's Ascend from TSMC. The Commerce Department declined to comment on the situation when contacted.

This action against Sophgo is part of a broader U.S. government strategy to regulate the use of technologies that may pose potential national security risks. The Entity List identifies foreign parties that are prohibited from receiving specific products subject to U.S. export regulations.

The decision to blacklist Sophgo reflects the Biden administration's ongoing scrutiny of Chinese technology companies and supply chains.