Thucydides’ trap seems to be unfolding step by step, this time not in the kinetic domain but cyber world. When a rising power threatens to displace a ruling one, it results in war. In entire recorded history, only, on 4 occasions out of 16 cases, war could be averted. Luckily out of these four occasions, three were witnessed in the 20th century. The world is all set to see the outcome of the 17th trap. In a recently published research piece by Routledge, the leading researchers have forecasted that the ongoing Cold War between the US and China will be different from the previous Cold War between the US and Russia. After the Second World War, both superpowers divided territorially world into two blocks. But, now, the US and China are competing globally for hegemony in infrastructure, energy, digital production and finances. Both powers operate in the same four areas and their economies are interconnected. So it is not a zero-sum game rather both countries along with their allies would seek to establish centrality in networks through which they can project geo-political and geo-economic power. A tiny island, Taiwan, which China considers its territorial part, is one of the leading producers of the most advanced chips which require complex software, explosive chemicals and ultra-pure silicon. The US has been witnessing the rise of China with a twisted eye but former President Donald Trump evolved it into a strategic contest between both countries. Trump in their Presidency’s initial days tried to pursue a deal with China on nuclear issues in the Korean Peninsula. However, this consideration, quickly turned into confrontation when in its national security policy, the US declared China its competitor and a revisionist state. The Russia-Ukraine war is still waiting for its conclusion. Over one million Palestinians are trapped in famine-like situations, artificially created by Israel and more than thirty-three thousand children and women have been killed in Gaza. Now, another front of global confrontation seems to be opening between the US and China in the digital domain. The US has not been able to resolve the Gaza issue and it will be very difficult to fight on another front, which is likely to have more severe consequences for the US economy. In a startling revelation, the US, UK and New Zealand recently labelled two Chinese cyber groups, Advance Persistent Threat Group 31& 40 (APT31&40) and alleged that these groups are responsible for malicious campaigns against British members of parliament who are critical of Beijing’s policies. These Chinese groups are also involved in the theft of data of over four million British voters. Although China has rightly rejected the allegation, it has sparked a new wave of cyber turf between China and the West. The UK has also named and sanctioned two Chinese nationals Zhao Guangzong and Ni Gaobin and their employer company ‘Wuhan Xiaoruizhi Science and Technology Company Ltd’. Meanwhile, the US also joins the UK in raising similar allegations that computer intrusions and cyber frauds in New York have been carried out by a group, which consists of Chinese nationals. US authorities said that those two Chinese involved in cybercrime in the UK are part of a group of seven who committed cybercrimes in the US. Authorities in New Zealand have also accused China of targeting its parliamentary network in 2021, by APT40. China has rejected the allegations and said that, rather than alleging China, the US and others, should stop their cyberattacks, which they carry out for “political manipulation”. The UK has sanctioned both personnel involved in their affiliate company. British authorities have frozen assets and put a travel ban on two Chinese citizens. National security has been the most discussed issue in international relations. Threats to states exist in the international system, however, the nature of the threat has transformed from political and military to multiple spheres including cyberspace, climate hazards, the virtual domain, and most of all economic affairs. Taiwan holds priority in the geopolitical contest between China and the US. During the last few years, the island of Taiwan has witnessed heavy push and pull between both global powers, not because of its strategic location but due to something else. There are many states in the world, which are accorded high priority due to their geographical positioning. but there is no single state other than ‘Taiwan,’ a small island, which has immense significance due to its technical prowess. A tiny island, Taiwan, which China considers its territorial part, is one of the leading producers of most advanced chips which require complex software, explosive chemicals and ultra-pure silicon. These chips are the biggest resource base of highly advanced computing in the world. Taiwan Semiconductor Manufacturing Company(TSMC) holds the most prestigious position in the production of the most sophisticated chips which its engineers make through highly secretive engineering skills and exceptional accuracy. How important is Taiwan for global politics? it is evident from the fact that TSMC has around 55 percent of the global market for contract chip fabrication, far above OPEC’s 40 percent market share for oil. Ashwin Rangan, former information officer of CyFy, an internet company, in his recent talk, said that the future technological plight of the US is focused on artificial intelligence and that Taiwan is the linchpin. Taiwan is producing billions of chips for the entire world. If China continue its threatening posture towards Taiwan then the US is bound to defend Taiwan due to obvious reasons. We may conclude that the future of AI is dependent on Taiwan and more specifically TSMC. The TSMC has tried to establish its outlet in Germany and the US. At the moment a project is under construction in Phoenix but hardware is not an issue. It is the human resources which is required to manufacture those sophisticated chips which the US does not have. A total of 4000 highly skilled and highly paid workers are required to manufacture these chips, required for AI. A Texas national security review ‘ War on the Rocks’ in its 25th March 2024 issue, published that in the annual threat assessment, the director of US national intelligence highlighted “If Beijing believed that a major conflict with the United States was imminent, it would consider aggressive cyber operations against US critical infrastructure and military assets. Such a strike would be designed to deter US military action by impeding US decision-making, inducing societal panic, and interfering with the deployment of US forces.” The writer can be reached at atiquesheikh2000@gmail.com.