Taiwan Semiconductor Manufacturing Company (TSMC), the leading wafer foundry, recently faced allegations that one of its customers violated the US chip export ban by acting as a middleman to sell chips to Chinese technology giant Huawei. TSMC has halted supplies to this customer, and it has now been revealed that the customer in question is a chip design company called Sophgo, a subsidiary of Chinese cryptocurrency mining firm Bitmain. However, Sophgo has denied these allegations in a statement.
In 2019, Huawei and 70 affiliated companies were added to the US trade blacklist. Since September 2020, TSMC has ceased shipments to Huawei. However, semiconductor research company TechInsights recently discovered that Huawei’s latest AI chip, the HiSilicon Ascend 910B, was manufactured by TSMC. TechInsights promptly notified TSMC of this finding.
After discovering that the chips it had manufactured for a specific customer ended up in Huawei products, TSMC took immediate action and stopped shipping to this customer in mid-October. TSMC also reported the situation to the US and Taiwanese governments.
According to a report by The Information, the customer in question is Sophgo, a chip design company under Bitmain, a Chinese cryptocurrency mining company. TSMC had also recently stopped supplying chips to Sophgo, while the US Department of Commerce was investigating whether TSMC had supplied chips to Huawei. The report did not confirm whether Sophgo directly supplied chips to Huawei after obtaining them from TSMC, and it is still unclear how the relationship between Bitmain and TSMC might be affected. Bitmain is currently the world’s largest manufacturer of Bitcoin ASIC miners.
However, The Information cited two insiders who claimed that the US Department of Commerce and TSMC recently discovered that “the chips manufactured by TSMC for Sophgo were similar to Huawei’s AI chip design.”
Sophgo, co-founded by Bitmain’s co-founder Micree Zhan in 2019, specializes in AI and RISC-V chip product design and sells products to local Chinese governments. TSMC has been delivering “hundreds of thousands of chips” to Sophgo until this month. According to the Chinese corporate registration database, Micree Zhan indirectly holds approximately 22% of Sophgo’s shares, and some of Sophgo’s subsidiaries share domain name registrations and email contact information with Bitmain.
However, Sophgo released a statement today emphasizing that the US Department of Commerce’s investigation into the potential relationship between TSMC and Huawei is unrelated to Sophgo and its products. Sophgo stated that it has always strictly complied with applicable laws and regulations, including but not limited to all applicable US national export control laws and regulations, and has never violated any of these laws and regulations. The company has provided TSMC with a detailed investigation report to prove that it is not involved in the Huawei-related investigation and reserves the right to take legal action against any individuals or entities that infringe upon its corporate reputation, including hostile competitors and media outlets that publish and disseminate false and misleading reports.