Washington is moving to block new Chinese optical transceivers from U.S. data centers, Reuters reported Tuesday, citing four people ​familiar with the matter.

Sources said the Federal Communications Commission-led measure targets components that beam data through fiber-optic cables, citing fears of espionage, malware or sabotage amid the artificial intelligence race, according to the report.

Officials hope to finalize the rule this year, though insiders say it could still be tweaked or scrapped, Reuters wrote.

The FCC did not immediately respond to MT Newswires' request for comment.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)