Chinese artificial intelligence laboratory Moonshot has gained access to Nvidia’s most advanced AI accelerators. Their import into the country is still banned in Washington, but the Chinese developer remains dependent on this equipment, according to documents submitted to the Chinese regulator.
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The developer of some of China’s most powerful AI models signed a contract in August to lease 32 Supermicro servers with Nvidia B300 GPUs, the most powerful AI accelerators on the market. Online filings indicate that the servers have an estimated value of 432 million yuan ($64.8 million) and are located in China, indicating a violation of US sanctions that prohibit their sale to some countries without a license. The existence of such a license could not be established, and it is unlikely that it existed, but Moonshot disputed the accuracy of the documents.
American authorities accused the AI laboratory of training some of its models on accelerators of the family, which are not officially supplied to China. Moonshot, the developer of the cutting-edge Kimi K3, which competes almost equally with the leading offerings of the US Anthropic and OpenAI, intends to go public in Hong Kong early next year. Washington has for years sought to limit the sale of advanced AI accelerators to China; US authorities were taking measures to dismantle a smuggling network that, according to their information, was transporting billions of dollars worth of Nvidia equipment into the country.
Documents we were able to review Bloomberginclude two financial contracts signed on August 4 by server owner Lingmeixin (Beijing) Technology Co., financing the purchase of Beijing Zhongguancun Bank Co. Chinese companies are required by law to provide certain information about financial contracts to a database maintained by the credit agency of the People’s Bank of China. Beijing Zhongguancun Bank provided them on August 6, two days after signing. Bloomberg sent a corresponding request to Lingmeixin, Zhongguancun and Moonshot on November 3, and references to the latter disappeared from the documents available in the database.
“We currently have no business relationship with Lingmeixin. We did not participate in, authorize or have knowledge of the related financing or guarantee agreements,” Moonshot said. The companies that signed the agreement in August “are not Nvidia customers,” a representative of the accelerator manufacturer said. Supermicro “does not do business with these entities” and “is committed to complying with all applicable U.S. export and re-export control laws and regulations,” the server maker emphasized.
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Lingmeixin provided Zhongguancun with double collateral for a loan of 200 million yuan ($30 million) for the purchase of servers: the physical collateral was the servers, and the financial collateral was the proceeds in the amount of 345.6 million yuan ($51.81 million), received under a service contract with Beijing Dark Side of the Moon Technology Co., which is the main legal entity of Moonshot. Lingmeixin and Zhongguancun did not provide comments on this issue. Each server under the contract is valued at 13.5 million yuan ($2 million) – approximately 350% higher than the market price in the United States; the markup likely indicates the existence of a black market due to restrictions imposed by Washington.
The equipment purchased with the funding provided is intended to fulfill the service contract with Moonshot, according to a note attached to the Lingmeixin contracts. “Moonshot AI receives only the right to use computing power, but does not acquire ownership of the equipment itself,” the documents emphasize.
Lingmeixin acts as a distributor of UAVs, including DJI products and related equipment, according to the company’s website. Among its partners are the China Aerospace Science and Industry Corporation (CASIC) and the China Aerospace Science and Technology Corporation (CASC) – they are subject to export controls and financial sanctions from the United States. Lingmeixin, the agreements say, acquired servers from a recently created subsidiary of Beijing Chunju Technology – how and at what price it acquired Supermicro servers is not specified in the documents. Beijing Chunju Technology specializes in e-commerce, but has expanded its activities into the AI segment.
Zhongguancun Bank was founded in 2017 by 11 public companies and specializes in supporting technological innovation. The servers, according to the documents, are located in Qingyang in western China. It is one of eight national computing centers and has proximity to affordable green energy. China is moving computing power from the east to the west of the country; Gansu Province and the Inner Mongolia Autonomous Region promise to become the largest computing hubs. In the next five years, the total capacity of data centers in the country promises to double.
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