US Reportedly Tracked AI Chip Shipments to China with Hidden Devices
In a significant escalation of the ongoing technological rivalry, the United States has reportedly deployed covert tracking devices within shipments of advanced artificial intelligence (AI) chips, aiming to intercept and expose their illicit diversion to China. This clandestine operation underscores the Biden administration’s intensified efforts to enforce stringent export controls designed to curb Beijing’s access to cutting-edge semiconductor technology.
Sources with direct knowledge of the matter, as reported by Reuters, indicate that these hidden trackers are strategically placed in select, high-risk shipments containing powerful AI processors from industry giants like Nvidia and AMD. These chips are typically integrated into servers manufactured by companies such as Dell and Super Micro. The tracking devices are reportedly concealed within the packaging, and in some instances, discreetly embedded inside the servers themselves. Some of these trackers are said to be as large as a smartphone, suggesting a sophisticated and deliberate monitoring effort.
The primary objective of this covert surveillance is to meticulously trace the movement of these sensitive components post-export, thereby identifying and dismantling smuggling networks that attempt to circumvent U.S. restrictions. This tactic allows U.S. authorities to gather evidence crucial for building cases against individuals and companies found to be in violation of export control regulations. While the specific agencies responsible for implanting these devices have not been definitively named, it is speculated that the U.S. Commerce Department’s Bureau of Industry and Security (BIS), Homeland Security Investigations (HSI), and the FBI are actively involved in the operation.
This recent development is a direct consequence of the export controls first introduced by the U.S. in 2022, which prohibit the sale of top-tier semiconductors to China, driven by concerns that these chips could bolster Beijing’s military advancements and sophisticated surveillance capabilities. The new tracking measures highlight the extensive lengths to which U.S. authorities are willing to go to enforce these restrictions, particularly in light of recent reports suggesting that billions of dollars worth of high-end Nvidia AI chips, including the H100, H200, and even the advanced B200, have already been smuggled into China despite existing bans.
The practice of embedding location trackers in sensitive exports is not entirely new for U.S. law enforcement, which has historically utilized such tools to monitor items like aircraft parts. However, their application to advanced AI semiconductors marks a significant escalation, reflecting the critical importance of these chips in the global race for artificial intelligence dominance.
When questioned about these reported tracking activities, Super Micro reportedly declined to comment on its security practices, while Dell stated it was “not aware of a U.S. Government initiative to place trackers in its product shipments.” Nvidia and AMD have also largely remained silent on the matter.
The revelation comes amidst a complex and evolving landscape of U.S.-China tech relations. Despite the strict controls, there have been instances of the U.S. backing down on certain restrictions. For example, the Trump administration reportedly reopened channels for the export of Nvidia H20 and AMD MI308 chips to China, albeit under an unprecedented arrangement where the chipmakers agreed to share 15% of the related sales revenue with the U.S. government in exchange for export licenses. Meanwhile, legislative proposals, such as Senator Tom Cotton’s ‘Chip Security Act’ in May 2025, aim to mandate location tracking in export-controlled AI chips, with the White House reportedly exploring GPS-free tracking methods.
This discreet yet assertive approach by the U.S. government signals a deepening commitment to controlling the flow of critical AI technology, transforming the global supply chain into a new frontier in geopolitical competition.