The fight inside the administration over China's back door to American AI chips is now out in the open. Treasury Secretary Scott Bessent said on CNBC on Friday that his department, the War Department, the State Department and the U.S. Trade Representative were all "in favor of putting Megaspeed on the entity list for months" — and that the one department that can actually do it, Howard Lutnick's Commerce Department, has not. "Commerce has the pen," Bessent said, "and you will have to ask them about their internal processes."
Megaspeed is the Singapore-based Nvidia customer suspected of diverting advanced American AI chips to China — the same company whose Malaysian unit is under investigation in Kuala Lumpur, and a name that runs through the collapse of Nvidia's Jensen Huang. Being placed on the Entity List would cut it off from American technology unless Commerce grants a licence. Bessent pointed out that Treasury's sanctions office has no control over exports; the decision belongs to Commerce's Bureau of Industry and Security. And he tied his frustration directly to the President's line: "I am frustrated when President Trump made it very clear that China should not receive any Nvidia chips above H100s." Nvidia itself put Megaspeed on its own blocked-transaction list back in June 2025. Commerce, by the reporting around Friday's interview, has not added any company to the Entity List in more than a year.
The public remarks followed an Axios report that Bessent pressed Lutnick in a White House Situation Room meeting last week on why Megaspeed had still not been listed, and that Lutnick answered he would "look into it." Commerce has denied that exchange ever happened — spokeswoman Kristen Eichamer said the two secretaries had "no such conversation." Asked about it on Friday, Bessent declined to confirm or deny it: "We don't repeat conversations in the Situation Room." What is not in dispute is the part he said on camera: four parts of the administration wanted the listing, the department holding the pen has not signed it, and Megaspeed remains off the list today.
For Americans, this is about who guards the gate on the most valuable technology of the age. Every advanced chip that slips to China through a middleman is computing power America's rival uses to close the AI gap — and the export controls that are supposed to stop it only work if the department in charge uses them. The Senate Banking Committee has already called both Lutnick and Huang to testify in December; Friday's interview guarantees the Megaspeed delay will be one of the first questions.
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