According to Bloomberg, Taiwan Semiconductor Manufacturing Co. (TSMC) has halted production of advanced silicon chips for Chinese chip start-up firm Biren Technology to comply with the latest U.S. rules.

Biren earlier said that the U.S. curbs did not apply to the artificial intelligence chips that TSMC produces because its chip specifications do not fall within the criteria for restrictions.  

Biren might face an uncertain future because TSMC now has to stop working with it, and no Chinese firms are capable of replacing the Taiwan firm.

Biren is considered the most prominent domestic chip designer, and its products have the potential to match up with graphics chips from Nvidia and AMD. 

However, the two American chip firms are now not allowed to sell their advanced chips to China’s market. 

In August, the Chinese chip start-up designer sought funds at a $2.7 billion valuation. The firm claimed that it had designed the first general-purpose graphics chip that is “setting a new record in global computing power.”

TSMC, the world’s largest contract chipmaker, said the company would comply with all relevant rules.

Due to U.S. chip restriction rules, not just Biren has to suffer, but other top Chinese semiconductor firms might face a downturn, at least in the short term. 

Right after Washington announced the export control restrictions on chip-making equipment, Chinese officials held closed-door emergency meetings with executives from chip firms.

During the meetings, Yangtze Memory, China’s top chip producer, warned the officials that its future might be in jeopardy. 

In the opening speech at the CCP national congress last week, Chinese leader Xi Jinping said that the regime would seek to win the battle of major core technologies and speed up its efforts to achieve technological self-sufficiency.

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