Speaking to Stratechery, Huang grumbled that rather than hobbling China’s AI ambitions the restrictions are supercharging its local competition.

“The idea of AI diffusion limiting other countries' access to American technology is a mission expressed exactly wrong. The right approach would be to “accelerate the adoption of American technology everywhere before it’s too late.”

According to the Financial Times, the whole row centres on the Nvidia H20 chip, a piece of silicon the company purpose-built for China before the US government turned around and blocked it anyway. Huang said Nvidia’s share of the Chinese market has tanked from 95 per cent in early 2021 to just 50 per cent now, thanks to a cocktail of sanctions from both the Biden and Trump administrations.

He’s not just grumpy about lost market share. He claims the bans mean Nvidia had to write off $5.5 billion in sales, walk away from a potential $15 billion, and kiss goodbye to around $3 billion in tax revenue.

“The China market is about $50 billion a year. And it’s not $50 million, it’s $50 billion. $50 billion is like Boeing, not the plane, the whole company.”

Instead of leaving China’s AI firms limping, the bans have pushed giants like Alibaba and Tencent to buy locally made hardware. That, in turn, has funnelled cash and momentum into domestic chipmakers that are closing the gap with Chipzilla’s offerings faster than Washington might like.

Former US commerce secretary Gina Raimondo has already said trying to block China’s tech growth through bans is “a fool’s errand,” arguing for more investment in homegrown R&D instead.

The biggest risk, Huang says, is long term. He’s worried the loss of the China market could weaken the very ecosystem around CUDA, Nvidia’s proprietary software stack, which remains its golden goose. Walk away from $50 billion and it’s not just the cash you lose, it’s the dominance that goes with it.