[sp527]

I think what you're missing here is that China would be (is?) happy to fund the development, because it's in their national interest and necessary in order for their companies to stay competitive, so long as there are trade restrictions on chips. Another framing for this is that China and certain other entities (e.g. content distribution channels like Meta, Youtube) have a strong incentive to 'commoditize their [AI] complement' (https://gwern.net/complement).