Trump Blocks Chinese-Backed HieFo’s Acquisition of US Chip Assets - A Geopolitical Power Play Unfolds

The White House just slammed the door. President Trump has officially blocked HieFo's attempted acquisition of critical US semiconductor assets, citing national security concerns and escalating the tech cold war.

Decoupling in Real-Time

This isn't just a blocked deal—it's a strategic move. The decision signals a hardening stance against foreign, particularly Chinese-backed, influence in foundational technologies. Semiconductors are the new oil, and America is guarding its reserves.

The Ripple Effect

Expect immediate fallout in global supply chains and investment corridors. Venture capital flowing into cross-border tech deals just hit a political iceberg. For markets, it adds another layer of friction—as if traders needed more uncertainty beyond the Fed's next mood swing.

A New Playbook for Tech Sovereignty

The rules of engagement are being rewritten in real-time. This intervention sets a precedent, turning every future foreign investment in critical tech into a potential geopolitical litmus test. It's industrial policy with a side of brinkmanship.

So, while Wall Street analysts scramble to model the impact, remember: in the high-stakes game of tech supremacy, policy is the ultimate disruptor. Sometimes, the most volatile asset isn't on the blockchain—it's in the Oval Office.

Cfius orders complete reversal of transaction

The Committee on Foreign Investment in the U.S. reviewed the purchase. The committee, called Cfius, examines foreign investments for security risks. Now HieFo has to sell everything it got from Emcore and undo the whole transaction.

Trump’s China policy on technology has mixed signals. He’s relaxed some trade restrictions during negotiations with Chinese leaders. He’s also allowed China to buy certain AI chips from Nvidia and other US companies. But the administration still blocks some exports and investments for security reasons.

Trump let Nvidia sell its advanced H200 AI chips to “approved customers” in China, but with a catch. Nvidia has to pay the government 15% of what it earns from those sales. Senator Elizabeth Warren and other Democrats called this dangerous for national security. As reported by Cryptopolitan previously, China ended up rejecting the H200 chips anyway. Instead, China chose semiconductors made at home.

Beijing mandates domestic equipment for chip production

China is pushing hard to build its own chip industry. Three people with knowledge of the policy told Reuters that China now requires chipmakers to source at least 50% of their equipment domestically when adding new production capacity. The rule isn’t published anywhere, but government officials have been informing companies about it in recent months when they apply to build or expand factories. Companies must prove through their purchasing bids that Chinese-made equipment will account for half or more of their orders.

This marks one of Beijing’s strongest moves yet to cut dependence on foreign technology. The push accelerated after the US tightened export controls in 2023, banning sales of advanced AI chips and semiconductor equipment to China. Those American restrictions only stopped the most sophisticated tools from being sold. But China’s 50% requirement means manufacturers pick Chinese suppliers even when they can still legally buy equipment from the US, Japan, South Korea, and Europe.

The US Trade Representative’s office released findings last month from a nearly year-long investigation into China’s semiconductor sector. Biden launched the inquiry in his final weeks as president, leaving Trump to decide what to do. Trump has since made a trade deal with Chinese President Xi Jinping that calmed global markets.

The government isn’t imposing new tariffs on chip imports right away. The tariff rate stays at zero for 18 months. On June 23, 2027, it will increase to a rate the government will announce at least 30 days beforehand.

A Federal Register notice said China’s effort to dominate semiconductors “is unreasonable and burdens or restricts U.S. commerce and thus is actionable.”

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