Nvidia sheds almost $600 billion in market cap, biggest one-day loss in U.S. history
DeepSeek on Monday said it would temporarily limit user registrations “due to large-scale malicious attacks” on its services, though existing users will be able to log in as usual.
DeepSeek, a Chinese open-source artificial-intelligence app, launched last month and topped Apple’s App Store in free downloads today. Its quick development and cheap start-up cost, startled technology stocks around the world in early trading. DeepSeek was able to launch their AI product with a budget of only $6 million, while its leading American competitor, San Francisco-based OpenAI, invested billions in research and development for their product, ChatGPT.
The app has grown in popularity since its launch, challenging the widely held belief that the US is the unassailable leader in AI and prompting questions about the scale of investments US firms are planning.
It is powered by the open-source DeepSeek-V3 model, which its researchers claim was developed for less than $6m - significantly less than the billions spent by rivals.
But this claim has been disputed by others in the AI space.
DeepSeek's emergence comes as the US is restricting the sale of the advanced chip technology that powers AI to China.
DeepSeek’s developers were even able to work around a US advanced-chip sales ban to innovate a breakthrough in the performance of its large-language AI model and bring a higher-functioning app to market at a fraction of the cost. Its model also needs less computing power than any of its American rivals available for free to download. Here’s more from BBC News:
After DeepSeek-R1 was launched earlier this month, the company boasted of "performance on par with" one of ChatGPT maker OpenAI's latest models - when used for tasks such as maths, coding and natural language reasoning.
Silicon Valley venture capitalist and Donald Trump advisor Marc Andreessen described DeepSeek-R1 as "AI's Sputnik moment", a reference to the satellite launched by the Soviet Union in 1957.
At the time, the US was considered to have been caught off-guard by their rival's technological achievement.
DeepSeek's popularity has startled markets. ASML, the Dutch chip equipment maker, saw its share price tumble by more than 10% while shares in Siemens Energy, which makes hardware related to AI, plunged by 21%.
And AI investors like Elon Musk could see a huge drop in their fortunes based on their shares’ trading value as markets around the world continue to react to this game changing news.