Markets Turn Red as Nvidia Plunges on $5.5B Charge From China Chip Ban

Equity and crypto markets took a hit late Tuesday after chipmaker Nvidia revealed it expects to take a $5.5 billion charge in its upcoming earnings due to U.S. export restrictions on artificial intelligence chips sold to China.

The announcement also sent shares of Nvidia and rival AMD tumbling in after-hours trading.

In a regulatory filing on April 15, Nvidia said the U.S. government had informed the company on April 9 that new export licenses are required for its high-bandwidth AI chips, including the widely used H20.

These restrictions cover exports to China, Hong Kong, and Macau, citing national security concerns and the risk of the chips being used in Chinese supercomputers.

Nvidia Expects Q1 Charges Tied to H20 Chip Inventory and Commitments

Nvidia warned that the charges for the fiscal first quarter—ending April 27—would include inventory write-downs, purchase commitments, and reserves related to the H20 chip.

The H20 is the most powerful AI chip Nvidia had been allowed to export to China under previous regulations.

However, the chip has reportedly been used by Chinese AI startup DeepSeek to train advanced models, drawing heightened scrutiny from U.S. officials.

Although the Trump administration initially paused the restrictions following a meeting between President Donald Trump and Nvidia CEO Jensen Huang, the decision has now been reversed.

The policy change follows increasing pressure to tighten export controls on advanced semiconductor technologies.

On April 14, Nvidia announced it would invest hundreds of millions of dollars to manufacture AI chips in the U.S. over the next four years.

Still, that wasn’t enough to calm investors, who reacted sharply to the looming financial hit.

BREAKING 🚨 Karoline Leavitt stuns the World by saying President Trump is turning America into a manufacturing Super Power once Again

“NVIDIA has commissioned more than a million Square Feet of manufacturing Space”

AMERICA IS BACK 🔥 pic.twitter.com/EZHPT7jcNA

— MAGA Voice (@MAGAVoice) April 15, 2025

Nvidia shares dropped 6% in after-hours trading to $105, while AMD fell over 7% to $88.55. Year-to-date, Nvidia stock is down 22%, while AMD has lost more than 25%.

The broader market sentiment also soured, with analysts warning that even top-tier tech firms remain vulnerable to rising geopolitical tensions and expanding trade restrictions.

Bitcoin Could Face Extended Consolidation Despite Bullish Hype: 10x Research

Bitcoin may be entering a period of extended consolidation, according to 10x Research’s head of research Markus Thielen.

In a recent market note, Thielen warned that short-term technical signals are painting a more cautious picture, even as many analysts forecast new all-time highs by mid-year.

Thielen pointed to the Bitcoin stochastic oscillator, a technical indicator that measures momentum, suggesting the market is displaying traits more consistent with a late-cycle top than the beginning of a new bull run.

While Thielen urges caution, other analysts maintain a more bullish stance.

Economists Timothy Peterson and Jamie Coutts, Real Vision’s chief crypto analyst, expect Bitcoin to hit new highs in Q2.

Bitcoin is trading near the low end of its historical seasonal range. Nearly all of Bitcoin's annual performance occurs in 2 months: April and October. It is entirely possible Bitcoin could reach a new all-time high before June. pic.twitter.com/p8upTNAkKH

— Timothy Peterson (@nsquaredvalue) March 15, 2025

Last week, Bitwise Chief Investment Officer Matt Hougan reiterated his December prediction that Bitcoin could hit $200,000 before the close of 2025.

Hougan argued that recent developments in U.S. trade policy, particularly under former President Donald Trump’s renewed tariff push, could act as tailwinds for Bitcoin.