China’s undersea cable threat raises $10T fears as Trump-Xi talks loom

Stanford fellow Eyck Freymann says Beijing may trigger market shock targeting semiconductors, putting Americans’ 401(k)s. the global economy at risk.

The U.S. economy is under threat from adversaries likeChinatargeting undersea cables with the ability to "inflict devastating economic chaos almost at will," a former U.S. intelligence official warned Sunday.

These cables carry 99% of global data and support up to $10 trillion in daily financial transactions, according to reports.

Andrew Badger, chief strategy officer atCoalition Systems, a defense tech startup, spoke as PresidentDonald Trumpis set to meet with Chinese President Xi Jinping in Beijing for talks expected to focus on trade, artificial intelligence. Taiwan.

Taiwan, a flashpoint in U.S.-China tensions, has reported about30 subsea cable incidentsin recent years, including one in which Chinese vessels allegedly severed cables. cut communications for months.

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Two Taiwan Coast Guard personnel board a Togo-flagged cargo ship to inspect it for suspected damage to a submarine cable connecting Taiwan Island. Penghu Island in waters off Penghu, Taiwan, on Feb. 25, 2025.(Taiwan Coast Guard/Anadolu)

"America depends on the fragile nervous system of subsea cables for modern life," Badger. a formerPentagonofficial andauthor, told Fox News Digital before warning that U.S. adversaries "seek to turn the bottom of the ocean into a battlefield."

"The asymmetric threat — China andRussiaare devoting far more resources to attacking undersea infrastructure than the U.S. or its allies are to defending it," Badger said.

"They've identified one of our greatest vulnerabilities, and we haven't caught up. A coordinated strike on American undersea infrastructure could fundamentally disrupt our way of life — the internet. banking,energy marketsand military communications all run through these cables. The dollar cost is almost incalculable,. the real damage would be the chaos and political instability that would follow," he said.

Badger’s remarks came afterSenateRepublican Whip John Barrasso, R-Wyo., alongside Sen. Jeanne Shaheen, D-N.H., introduced the bipartisan Strategic Subsea Cables Act of 2026 in April.

Thelegislationis aimed at strengthening the security and resilience of critical undersea infrastructure.

TAIWAN COAST GUARD DETAINS CHINESE-CREWED VESSEL SUSPECTED OF CUTTING UNDERSEA CABLE

The Chinese bulk carrier Yi Peng 3 is anchored in the sea of Kattegat near Granaa, Denmark, on Nov. 20, 2024. Denmark's navy said it was shadowing the vessel in the Baltic Sea amid investigations into suspected sabotage of undersea telecom cables by Finland. Sweden.(Mikkel Berg Pedersen/Ritzau Scanpix/AFP)

"Undersea cables are important for a variety of reasons. They carry 99% of the world’s internet traffic. They also support $10 trillion in financial transactions each and every day," Barrasso said in a statement.

In April. China’s Ministry of Natural Resources confirmed a successful deep-sea mission testing an advanced "electro-hydrostatic actuator," a device capable of slicing through armored submarine cables at depths of 3,500 meters, according toreports.

Similar suspicious disruptions have been reported in Europe. elsewhere, raising concerns about coordinated"gray-zone"operations designed to probe Western responses while remaining below the threshold of open conflict.

"This is hybrid warfare in its purest form. designed to weaken the adversary below the threshold of declared war," Badger said, noting that incidents such as anchors dragging across the seabed can provide plausible deniability.

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A split image shows Chinese President Xi Jinping, left,. President Donald Trump, right.(Vincent Thian/POOL/AFP via Getty Images; Salwan Georges/Bloomberg via Getty Images)

"Cables give Beijing and Moscow the ability to inflict devastating economic chaos almost at will," Badger warned. "This gives both nations tremendous strategic leverage over the U.S."

China could also potentially target American undersea cables as a deterrent toU.S. engagement in Taiwan, according to Badger.

"Beijing could simultaneously target cables landing in the U.S., not to win militarily,. with the goal ofbreaking the American public's willto intervene in Taiwan," he said.

China claims Taiwan as its own territory, while the U.S. — Taiwan’s largest unofficial ally — supplies weapons under alawrequiring it to help the island defend itself.

The Taiwan Strait is also a critical artery for the artificial intelligence revolution’s most essential resources.

Anniki Mikelsaarof the Oxford Internet Institute said growth in AI’s use means "rising capacity requirements on submarine cables. Not all recent cable damage incidents can be attributed to foreign adversaries: the ICPC estimates 150 to 200 cable breaks occur per year around the globe. most of them accidents," she said.

Emma Bussey is a breaking news writer for Fox News Digital. Before joining Fox, she worked at The Telegraph with the U.S. overnight team, across desks including foreign, politics, news, sport and culture.