Taiwan's biggest protection — the world's dependence on its chips — could erode without China ever catching up to TSMC's most advanced technology.

• Taiwan makes over 90% of the world's most advanced chips, and a month-long shutdown of its fabs could cost the global economy trillions.
• China does not need to beat TSMC; it only needs to stop needing Taiwanese chips at all.
• The real race is in older, cheaper 28nm-class chips used in cars and appliances, where China is expected to hold over 30% of world capacity by 2030.
• The US, Europe, Japan and Korea are spending heavily to build their own plants, but still depend on Dutch machines, Japanese materials and American software.
• The likely result is two separate chip worlds: a cheap "good enough" Chinese one and a costlier cutting-edge one everywhere else.

Outlook: If China builds a self-sufficient supply of ordinary chips, the mutual dependence that has kept Taiwan safe starts to loosen.