Nvidia CEO Jensen Huang has been a central figure over the last two years in the U.S.-China relationship, working to ease tensions between the superpowers even as they compete for AI dominance.

He built close ties to President Donald Trump and pushed for easing U.S. export controls on advanced chips needed for large language models, arguing the move would benefit both countries.

But now, one of the strongest proponents of easing technology restrictions on China -- who also pushed back against a decoupling of the countries -- might have less influence as Nvidia's board investigates reports that Huang was the target of an espionage operation.

Geopolitical consultants expect the Trump administration to have a hard time embracing Nvidia going forward amid bipartisan calls for increased scrutiny. Last week, Huang was asked to appear at a joint briefing of several House Committees on Nov. 18 to discuss Nvidia's security protocols against foreign espionage and Huang's interactions with Alice Huang, a one-time executive at Megaspeed International, which partners with Nvidia.

U.S. officials last year concluded that Alice Huang, who is a Chinese citizen and no relation to the Nvidia CEO, was sharing information with China's government, according to The Wall Street Journal.

In a letter, Huang apologized to the company and his family and said he would cooperate fully with the investigation and was committed to "supporting America's national security."

It is unknown how the revelations about Jensen Huang will play out, but he has been a prominent voice pushing back against national security experts who want tighter restrictions on China's access to U.S. technology, arguing that it doesn't freeze China's progress on AI but rather intensifies its bid to become self-reliant.

China's Foreign Ministry spokesman overnight called the espionage allegations a "smear campaign."

He has been lobbying the White House to allow Nvidia to sell certain advanced chips to China and pushing technology companies and Washington think tanks to soften their advocacy for tighter controls, says Michael Hirson, analyst at 22V Research.

Those efforts frustrated more hawkish members in the administration, as well as members of both parties in Congress who support tougher actions against China as the rivalry between the two countries intensifies.

Analysts already were recalibrating their expectations for U.S.-China policy after the Democrats flipped control of Congress in midterm elections. Many see the possibility Democrats could ramp up export controls, with the revelations about Huang giving them increased momentum to prioritize national security measures.

The latest developments, paired with reports those within the Trump administration knew Huang was a target of a Chinese spy operation for months, are likely to intensify scrutiny of the relationship between the two men, as well as Trump's relationship with others in the business community, as Democrats gear up for congressional investigations, says Dennis Wilder, a former senior intelligence officer who is now a senior fellow for the Initiative for U.S.-China Dialogue on Global Issues at Georgetown University.

The strong showing by the Democrats, the polls showing public skepticism about AI and data centers, and Trump's decision to replace Susie Wiles, who Wilder says was seen as closer to the business community, with Stephen Miller as chief of staff also portends a potentially tougher stance against China.

Treasury Secretary Scott Bessent last week urged China to immediately and fully implement the commitments it had made last fall that led to the current truce that expires in early January.

The U.S. has been unhappy with the pace of China approving export licenses for the flow of critical minerals the U.S. needs for everything from munitions to semiconductors, as well as its pace of purchases on agricultural and other commercial fronts, geopolitical consultants say.

China, for its part, has wanted to get greater guarantees itself, such as pushing the U.S. to vow not to use its access to Boeing parts and engines against it, Wilder says.

Expectations are low for Trump's next meeting with Chinese leader Xi Jinping in mid-November on the sidelines of the APEC meeting in Shenzhen. Another meeting is expected in December, when Xi travels to Florida for the G-20 meeting.

Both leaders have been trying to keep the relationship stable and a lid on offensive measures against each other. But geopolitical consultants see the task of maintaining the truce as more complicated with Democrats taking control of Congress after such a strong showing in the midterms.

The new Congress is likely to increase scrutiny of the Commerce Department and the Bureau of Industry & Security amid reports China has been able to access Nvidia chips through many loopholes.

Veda Partners' Henrietta Treyz says Congress could add tougher controls to the National Defense Authorization Act during the lame-duck session this year. But Treyz notes Nvidia's influence on the market and AI trade as a potential limitation to restrictions.

"President Donald Trump views the company's success as tied to his success," she notes, adding that Trump backed Huang even after being briefed last year Huang was being targeted by a Chinese spy.

Another limiting factor: China still has a grip on critical minerals, which limits just how far the U.S. will be able to go with its technology restrictions. That said, the Nvidia revelations and a new Congress could allow the more hawkish members of both parties to regain some control and put momentum behind some of the legislation in the works to tighten restrictions on China.

That could mean a more fraught U.S.-China relationship over the next two years.