Chinese AI startup DeepSeek has recently made waves in the U.S. stock market with its innovative technology that some experts say rivals that of major American companies like OpenAI. The company’s low development costs, estimated at only $6 million, have caught investors off guard and raised concerns about the valuation of other tech stocks. DeepSeek’s new AI model released on January 20 has caused major disruptions in the market, with shares of companies like Nvidia and ASML plummeting.
Founded in 2023 by Liang Wenfeng, DeepSeek is a private Chinese company that has quickly gained attention for its impressive AI capabilities. The company’s AI app, which uses reduced capability chips from Nvidia, is available in the U.S. through Apple’s App Store and online. Despite some technical difficulties due to large-scale attacks on its service, DeepSeek has become a top download on the App Store.
Experts have praised DeepSeek for its sophisticated AI model, which relies on “inference-time computing” to save money and computation power. The company’s technology has raised questions about the overspending of U.S. companies on AI advancements and the potential impact on major players in the industry. While some analysts believe that the current stock selloff is an overreaction, the long-term implications of DeepSeek’s emergence in the market remain uncertain. As investors await further updates from tech giants like Meta and Microsoft, the future of AI technology in the U.S. hangs in the balance.