U.S. held back blacklisting DeepSeek, over 100 Chinese firms despite security concerns, sources say

The Trump administration has controversially delayed blacklisting over 100 Chinese technology firms, including prominent AI startup DeepSeek and memory chipmaker CXMT, despite clear national security concerns and prior interagency approval for their inclusion on a trade blacklist. This unprecedented pause, the longest in over a decade, signals Washington's deliberate attempt to de-escalate simmering tensions with Beijing, prioritizing diplomatic stability over immediate security measures in the high-stakes technological rivalry. The deferred action comes as the U.S. grapples with DeepSeek rapid ascent in the global AI landscape—its low-cost models have raised alarms, with U.S. officials alleging support for Chinese military and intelligence operations and attempts to illicitly access advanced U.S. chips. CXMT, China's largest DRAM producer, has similarly been flagged by the Pentagon as a Chinese military company, making its omission from the Commerce Department's Entity List particularly contentious given ongoing U.S. efforts to restrict China's access to advanced semiconductors. This decision underscores a deep policy rift within the U.S. government, as experts warn that slowing such listings could allow sensitive American technology to further bolster strategic competitors. This delay prolongs a period of uncertainty for both U.S. tech firms navigating complex export control regimes and Chinese entities seeking to avoid further restrictions. The administration's current approach attempts a delicate balance between national security and economic stability, but it risks emboldening Beijing's indigenous technology push and could invite further accusations of intellectual property theft or military-civil fusion. Observers will be watching closely for any subsequent shifts in the Commerce Department's stance, particularly as the geopolitical calculus between Washington and Beijing continues to evolve amidst an intensifying global technology decoupling.