I will assume this riddle meant to be a binary choice of drink 1 or the other cup and one cup is death, other is not, and will not dodge that question.
I take the cup he offers.
His problem is as follows: If I do know he knows I know, then I am a potential threat to him purely from seeing him as having a huge incentive to silence me.
If I drink the cup he offers, it indicates I do not see him as a potential threat to myself, which again indicates I don't think that he knows that I know. He has less reason to kill me in such a scenario and will thus make the unpoisoned cup be the one I would pick up if I didn't know he knew I knew.
If I would take the cup he doesn't offer, it would indicate I am afraid of him, which indicates I think he knows that I know. If I am that fearful of him, it means I might pre-emptively strike him at some point, which makes it logical to poison the cup I would take if I did indeed know he knew about me knowing.
He would through this action think he was eliminating the potential survival of the highest threat scenario towards himself.
A game akin to flooding 1 of 2 rooms with lava, where in both rooms there is a 50% chance of there being a beast (with minimum 1 and maximum 1 beast total across the two rooms), but one assumes the beast that could exist in one of the rooms would be more dangerous than the beast that could exist in the other.
Of course, he could have thought 1 doublethink order higher in the typical rock paper scissor fashion and thus reversed which cup was poisoned, but if this riddle is supposed to have a definite A/B cup choice answer at all I think it must be this.