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Insiders know that ByteDance has been leasing Malaysia-based servers with H100 chips since February 2025. The Blackwell expansion, roughly 36,000 B200 chips across 500 systems worth over $2.5 billion is just the next chapter. I can see the headline: Chinese company outsmarts export controls, enforcement is theater.
That take isn't wrong. But it's missing the most structurally interesting part. The Affiliates Rule, issued by BIS in September 2025 to close exactly this kind of ownership-chain circumvention, was suspended for a year in November following significant industry pushback. ByteDance isn't on the Entity List directly, so the lessee arrangement sits in clean air. It didn't exploit an overlooked loophole. It exploited one regulators identified, wrote a fix for, and then left open.
The second thing: the House passed the Remote Access Security Act 369-22 in January 2026 to fix the gap, because BIS currently does not treat remote compute access as an export at all. But it hasn't cleared the Senate, and until it does, the legal authority to regulate this doesn't exist. ByteDance is running in the gap right now.
NVIDIA wins either way near-term, demand routes through Malaysia instead of being blocked. The more interesting risk is structural: inference can run on domestic Huawei chips after training on offshore Blackwell hardware. ByteDance trains in Malaysia, infers at home. Over time that closes the capability gap without requiring direct chip access. That's the slow-burn threat to the NVIDIA GPU scarcity premium thesis that I don't think is fully priced yet