The US has opted to delay blacklisting Chinese AI developer DeepSeek, memory chipmaker ChangXin Memory Technologies (CXMT), and more than 100 other firms. The reason is straightforward: Washington doesn’t want to pour gasoline on an already smoldering relationship with Beijing.
The Commerce Department’s Entity List, which restricts American technology exports to designated companies, has been the primary weapon in that campaign. But adding over 100 firms in one stroke would represent a significant escalation, and right now, diplomacy appears to be winning the internal debate.
The companies in the crosshairs
DeepSeek has emerged as one of China’s most formidable AI developers. The company released its V3 and R1 models, which demonstrated rapid capability gains that caught Washington’s attention. Those models were reportedly built with the help of stockpiled chips, including Nvidia H800 processors, before US restrictions could fully bite.
NASA and the Pentagon both banned DeepSeek from their devices in 2025. But a full Entity List designation, which would cut the company off from a broader swath of American technology, has not materialized.
DeepSeek has since begun pivoting toward Huawei’s Ascend hardware as its chip supply strategy.
CXMT has been under scrutiny for US Entity List inclusion since 2024. The company is one of China’s leading producers of advanced DRAM memory chips. The proposed blacklisting of CXMT has faced repeated delays, linked directly to the ongoing complexity of US-China trade negotiations.
A pattern of escalation, then pause
In March 2025, the Commerce Department added over 80 entities to the list, with more than 50 of those being Chinese companies. That batch was specifically aimed at curbing what Washington described as illicit technological advancements in AI and advanced computing.
The intensification of US export controls on advanced technologies has been an ongoing process since 2022. The strategy has centered on limiting China’s access to cutting-edge chips, chip-making equipment, and the software tools used to design them.
What this means for investors
For companies in the US chip supply chain, the calculus is complicated. A blacklist would theoretically benefit domestic producers by cutting off Chinese competitors from key technologies. But it would also disrupt revenue streams for American firms that currently sell to Chinese customers. Nvidia, for example, has already seen its China business constrained by previous rounds of export controls.
For the crypto market specifically, the direct implications are limited but not zero. AI-related tokens have become increasingly sensitive to developments in the broader AI industry. Any major disruption to chip supply chains or AI model deployment could ripple into crypto markets where AI narrative tokens have attracted significant speculative capital.
Investors should be watching the US-China trade negotiation timeline closely. A breakdown in talks could accelerate the blacklisting process dramatically. Conversely, a successful trade agreement could shelve these additions indefinitely.