DeepSeek AI Just Shook the Tech World – Here’s Why It Matters

A new artificial intelligence (AI) model from China, DeepSeek, has taken the tech world by storm. It has quickly become the most downloaded app on the Apple Store, shocking investors and shaking up the stock market. This unexpected rise has put global AI leaders on notice, with even former U.S. President Donald Trump calling it a “wake-up call” for American tech companies.

Why is DeepSeek Making Headlines?

The biggest reason DeepSeek is gaining attention is its claim of being cheaper and more efficient than AI models like OpenAI’s ChatGPT. Unlike its competitors, DeepSeek uses fewer advanced chips, making it more cost-effective while delivering powerful results.

This breakthrough has had massive consequences. Nvidia, the world’s top chipmaker, lost nearly $600 billion in market value in just one day—the biggest single-day loss in U.S. history. The drop happened because DeepSeek’s success suggests that expensive, high-performance chips may not be as essential for AI development as previously thought.

What is DeepSeek?

DeepSeek is a free AI chatbot that works similarly to ChatGPT. Users can ask it questions, generate text, and even get help with coding and math problems. Reports suggest it performs at the same level as OpenAI’s GPT-4 o1 model, which was released in late 2023.

One key difference? DeepSeek uses less memory and computing power, which lowers its operational costs significantly. This is a game-changer in the AI space, proving that big budgets aren’t always necessary for cutting-edge AI.

However, like other Chinese AI models such as Baidu’s Ernie and ByteDance’s Doubao, DeepSeek is programmed to avoid politically sensitive topics. For example, when asked about Tiananmen Square (1989), DeepSeek refused to provide an answer. This level of censorship is common in Chinese tech products and remains a concern for global users.

Who is Behind DeepSeek?

DeepSeek was founded in December 2023 by Liang Wenfeng, a graduate of Zhejiang University with a background in electronic information engineering and computer science. Unlike many Silicon Valley AI entrepreneurs, Liang also has finance experience, as he is the CEO of a hedge fund called High-Flyer, which uses AI for stock market analysis.

Liang believes China must move beyond imitation and become a true innovator in AI. His vision is now becoming a reality with DeepSeek’s rapid rise.

How Did DeepSeek Become So Powerful?

Despite the U.S. banning Nvidia A100 chips from being exported to China since September 2022, DeepSeek’s founder stockpiled thousands of these chips before the restrictions took effect. Experts estimate he collected around 50,000 units, allowing him to train DeepSeek at a fraction of the cost compared to OpenAI, which reportedly spent over $100 million on training GPT-4.

On the day DeepSeek became the #1 free app on the U.S. Apple Store, it faced massive cyberattacks, forcing the company to temporarily restrict registrations. Additionally, its website suffered outages, showing just how much global interest (and controversy) DeepSeek is generating.

The Global Impact of DeepSeek

DeepSeek’s success has already started reshaping the AI industry and the stock market:

• Nvidia’s stock dropped 17%, erasing billions in market value.
• The Nasdaq tech index fell more than 3% due to investor uncertainty.
• Silicon Valley is now facing pressure to rethink its AI strategies.

China, on the other hand, is celebrating DeepSeek’s success as proof of its growing tech independence. State media is already boasting that “Silicon Valley and Wall Street giants are losing sleep” over DeepSeek’s rise.

Is DeepSeek a Threat to U.S. AI Dominance?

DeepSeek has exposed a major shift in the AI industry. The belief that only companies with massive budgets and the best hardware can dominate AI is now being questioned. This could change the way AI is developed and who controls the future of technology.

However, concerns remain. Australian officials have already raised security and privacy questions about the app. As more users sign up for DeepSeek, data protection, censorship, and transparency will be key issues moving forward.

The Future of DeepSeek

DeepSeek’s rise signals a new era in AI competition between the U.S. and China. While OpenAI, Google, and Microsoft dominate in the West, DeepSeek is proving that China can compete at the highest level—and at a lower cost.

As AI continues to evolve, one thing is clear: DeepSeek is here to stay, and the global AI race is only getting started.

What do you think where will it land? Will it overtake ChatGpt’s dominance? Share your thoughts!