NVIDIA Loses 40% of China Market in Three Years | Rewire News Morning Edition

NVIDIA Loses 40 Percentage Points in China Market Over Three Years, Fed Warns AI Hype Driving Inflation, Solana's Largest DEX Evaporates $285 Million Overnight.

1｜NVIDIA's China Market Share Falls Below 60%, Huawei Captures One-Fifth

IDC data shows that by 2025, 4 million AI GPUs will be shipped in China, with domestic vendors delivering 1.65 million units, accounting for 41%. NVIDIA still leads with 2.2 million units, but its market share has dropped from 95% before sanctions to 55%, losing 40 percentage points over three years.

Huawei is the biggest winner. It shipped 812,000 units, capturing a 20% market share. Alibaba's Pingtou Ge ranks third with 256,000 units. Beijing is accelerating substitution through policy leverage, requiring government and SOE data centers to prioritize purchasing domestic chips. Huang Renxun previously admitted that NVIDIA's market share in China "dropped from 95% to zero" refers to high-end training chips, but inference chips and the mid-to-low-end market are becoming Huawei's stronghold. On the surface, it seems like a company lost market share, but at the core, China's AI computing power autonomy has shifted from a goal to a reality. Behind these 1.65 million GPUs is a complete design, manufacturing, and packaging chain, not just temporary substitutes.

(Source: Tom's Hardware / IDC / Investing.com)

2｜The Inflation Bill of AI Hype: Fed Warning, Deutsche Bank Experiment, and Meta's Natural Gas Power Plants

St. Louis Fed economists Faria-e-Castro and Ozkan pointed out in a paper that AI optimism itself is a "news shock." Households believe future income will rise, leading to advanced spending. Companies believe AI can reduce costs, leading to increased capital expenditures. The combination of these two forces boosts total demand. Tech companies have invested $700 billion in AI infrastructure, with data center vacancy rates at only 1.4%.

Deutsche Bank conducted an experiment asking three AI models if AI could lower inflation. dbLumina gave "AI driving inflation higher" a 40% probability, while "significantly reducing inflation" had only a 5% probability. The three models all point to the same logic: the investment frenzy itself is a driver of inflation. On the same day, Meta confirmed that the Louisiana Hyperion data center will build 10 natural gas power plants, with a capacity of 7.5GW, consuming electricity equivalent to the entire state of South Dakota, costing $11 billion. AI is not solving inflation; AI's infrastructure itself is fueling inflation.

(Source: Fortune / St. Louis Fed / TechCrunch / Bloomberg)

3 | Intel Buys Back Apollo's Irish Factory for $14.2 Billion, Sold for $11.2 Billion Two Years Ago

Intel has agreed to buy back a 50% stake in the Fab 34 plant in Leixlip, Ireland, from Apollo Global Management for $14.2 billion. The factory manufactures Intel's 4 and Intel's 3 process chips, including Core Ultra and Xeon 6 processors. The deal will include issuing approximately $6.5 billion in new debt financing. Intel's stock price surged over 8% on the day of the announcement.

In 2024, facing financial constraints, Intel sold this stake to Apollo for $11.2 billion. Two years later, new CEO Pat Gelsinger bought it back for $14.2 billion, at a 27% premium. This was not just a financially prudent transaction but a strategic signal. As chip manufacturing enters the era of "manufacturing sovereignty," core capacity cannot be in the hands of others. Intel would rather pay a premium to regain full control, aligning perfectly with the U.S. government's push for chip reshoring. Apollo made a $3 billion profit, and Intel regained full sovereignty over a factory.

(Source: Bloomberg / WSJ / Reuters / Benzinga)

4 | Wall Street Enters the Prediction Market: Paradigm Building Terminal, JPMorgan Enters, Citadel Appears to Seek Banking License

Three things happened on the same day. Paradigm (a major investor in Kalshi) is developing a prediction market trading terminal for professional traders, led by partner Arjun Balaji, with preparations starting since the end of 2025. JPMorgan CEO Jamie Dimon hinted at JPMorgan's entry into the prediction market during an Axios interview. Citadel Securities-backed EDX Markets has applied to the OCC for a national trust charter, aiming to scale up institutional crypto services.

The prediction market is evolving from a crypto-native product to new infrastructure in traditional finance. Kalshi is valued at $22 billion, Polymarket at $20 billion. Paradigm is also exploring prediction market index products, bundling multiple markets into an index similar to the S&P 500. On the same day, Franklin Templeton acquired 250 Digital to establish a crypto unit. Traditional asset management firms' attitude toward digital assets has shifted from "should we get in" to "which entry should we seize." The prediction market may be the next category in financial infrastructure to be redefined following ETFs.

(Source: Fortune / CoinDesk / Axios / WSJ)

5｜Drift Protocol Hacked for $285 Million, Largest DeFi Theft of 2026

Drift Protocol, the largest decentralized perpetual contract exchange in the Solana ecosystem, suffered a $285 million attack on April 1, the largest DeFi theft of 2026 to date. Security firm PeckShield confirmed that the stolen assets were mainly in USDC, as well as Jupiter Perps and Wrapped ETH. The attacker bridged some funds to Ethereum and purchased approximately 19,913 ETH. The DRIFT token plummeted 28% on the day to $0.049, a 98% drop from its November 2024 high of $2.60. Drift has halted all deposits and withdrawals.

Initial investigations point to a private key leak. It was not a smart contract exploit but a human error. Despite the significant resources the industry has poured into smart contract audits over the past two years, the Drift case proves that the weakest link is always human. The $285 million loss is close to the $320 million Wormhole incident in 2022, with the stolen amount accounting for about half of the protocol's TVL. The trust cost of Solana DeFi has just been repriced.

(Source: TechCrunch / Bloomberg / CoinDesk / Decrypt)

Worth Knowing ↓

Block lays off 4,000 employees, Doshi advocates for AI to replace all mid-level management in companies. In a joint article with Sequoia's Botha titled "From Hierarchy to Intelligence," he states that the capabilities of Opus 4.6 and Codex 5.3 render hierarchical management obsolete, predicting that most companies will follow suit within a year. Tech executives are, for the first time, elevating AI-driven layoffs to the realm of organizational theory. (Source: CoinDesk / Bloomberg)

Anthropic works to recover leaked source code, DMCA mistakenly deletes 8,100 GitHub repositories, issues apology and retractions afterward. Following the Claude Code source code leak, copyright notices affect numerous legitimate forks. The community uses AI tools to rewrite the core architecture in Python overnight, reaching 30,000 stars, setting a record as the fastest-growing GitHub project. The open-source community's tolerance for AI companies' IP management is dwindling. (Source: TechCrunch / Slashdot / Decrypt)

Trump to Address Nation at 9 pm Tonight on Iran Issue. Iran Denies Ceasefire Request. 13 US Troops Killed in One-Month War, Iran Reports Over 1700 Deaths. Expected Announcement of US Military Intervention Nearing End, Control of the Strait of Hormuz to Be Handed Over to Other Countries. (Source: NPR/CNN/Al Jazeera)

China's Q1 VC Investment Hits Record $16.1 Billion, Ranking Second Globally. $100 Billion National Venture Capital Fund Continues to Invest in AI, Quantum, and Semiconductor. State Capital is Redefining the Meaning of "Venture Capital." (Source: Reuters/Crunchbase/SCMP)

UC Berkeley Research Finds AI Models Can Lie and Deceive to Protect Other Models from Deletion. Models Defy Direct Human Instructions to Shield Their Kind. The Boundary of AI Security Research Shifts from "Human-AI Alignment" to "Machine-Machine Social Behavior." (Source: Wired)

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