This is your Beijing Bytes: US-China Tech War Updates podcast.

Big week on the Beijing Bytes, so plug in, listeners, because the US-China tech war has truly entered Beast Mode. Let’s start with the bombshell: over eight million Americans had their data leaked thanks to the Salt Typhoon cyberattack. Yes, you heard that right—according to WebProNews, Chinese state-sponsored hackers apparently waltzed into US telecom networks, scooping up call records, personal messages, and geolocations, including those of political heavy-hitters. The attackers used zero-day exploits to dodge detection for months, turning outdated telecom systems into Swiss cheese. The result? Not just privacy nightmares, but real headaches for national security—think National Guard files and deployment plans in hostile hands. CISA and the FBI have gone into overdrive, pushing AI-powered threat detection and organizing incident response like it’s DEFCON One.

In the midst of this chaos, President Biden’s Executive Order 14105 is still the elephant tap-dancing through the chip factory: no more US cash for Chinese semis, AI, or quantum ventures. The Treasury didn’t just ban direct investments—they’ve clamped down on debt, joint ventures, and even those sneaky indirect deals. Over 50 Chinese tech firms, including Integrity Technology Group, have been blacklisted over links to cyberattacks and military ops. The net effect? Chinese firms are scrambling, especially in semiconductors and AI. They can’t get US equipment, and AI startups are being ghosted by Western investors. Sectors like autonomous vehicles and drones are taking a direct hit, and the TikTok divestiture drama remains stuck in political limbo.

But plot twist—while China’s exports to the US cratered by a mind-melting 70% in August, Goldman Sachs points out China is still humming along, shipping tech to Europe and emerging markets. Asian neighbors like Taiwan and Vietnam have filled the US gap, with Taiwan’s exports—mostly advanced chips and server parts—soaring 30%. Meanwhile, Huawei just pulled a Houdini, bypassing Nvidia’s chips with its own breakthrough for AI, while Tencent and Alibaba are betting big on homegrown AI processors as China tries to shake itself free from foreign tech dependencies.

Then, on the home front, Beijing fired back by launching an anti-monopoly probe into Nvidia, all while Chinese agencies fast-tracked new rules: the Cyberspace Administration of China unveiled a strict cybersecurity-incident reporting mandate to kick in by November, standardizing how companies must confess breaches or face steep penalties.

Analysts say these salvos signal a full-court decoupling: the US piles on security rules—like the Protecting Americans’ Data from Foreign Adversaries Act—forbidding sensitive info from going east, while Chinese regulators tighten data localization and reporting. Meanwhile, US cybersecurity firms are popping champagne—Booz Allen Hamilton just landed a $421 million gig with CISA, and new government tech contracts are in the billions.

Strategic implications? The supply chain shuffle is permanent. US investors are fleeing China-facing tech, flocking instead to secure software, supply chain risk mitigation, and any startup with “quantum-resistant” in its pitch deck. Experts from South China Morning Post warn about retaliatory anti-dumping probes and tech substitution, but as long as the cyber onslaughts keep hitting, lawmakers on both sides are unlikely to blink.

Looking forward, think tighter rules, faster retaliation, and a boom for quantum and AI security. Every day, we’re inching closer to a world where the wires between Silicon Valley and Zhongguancun might as well run through a firewall.

Thanks for tuning in to Beijing Bytes—subscribe for the latest pulse of the tech war, and keep your data close, listeners! This has been a quiet please production, for more check out quiet please dot ai.

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