DeepSeek is an AI startup based in Hangzhou, China, which was founded in 2023 to solve complex problems and algorithms. It has completely knocked out Nvidia and OpenAI in the U.S. Market.
Deepseek is an AI-powered chatbot, which looks similar to ChatGPT and Google's Gemini and works almost like them.
It is reported that it is more proficient than most of the AI chatbots present in the current market.
What is more surprising is that it is completely free unlike them.
It is quite powerful because it can perform most complex tasks like mathematics and coding easily in a short period of time.
Why are companies like Nvidia impacted?
DeepSeek completely overturned the belief that large budget and high quality chips are the only ways of advancing AI, which has created uneasiness in the top competitors.
"DeepSeek has proven the point that high tech AI models like chatbots can be developed even with low resources," says Wei Sun, principal AI analyst at Counterpoint Research.
"In contrast, OpenAI, valued at $157 billion, faces scrutiny over its ability to maintain a dominant edge in innovation or justify its massive valuation and expenditures without delivering significant returns."
AI-related stocks took a hit on Monday, with Nvidia shares falling 17%, reducing $600 billion in value and marking the single-biggest one-day loss for a company in stock market history, according to reports. ASML sank 6%, while Broadcom, another semiconductor stock, also slumped 17%.
Is our privacy compromised with DeepSeek?
Many top experts are concerned about the personal data of users collected by DeepSeek, given that the company stores data from users — including their date of birth, keystrokes, text or audio inputs, uploaded files, chat history and other data — on servers located in China, according to its privacy policy.
How DeepSeek will help China’s economy?
DeepSeek’s sudden rise is a huge boost for the Chinese government, which has been looking to build tech independent of the U.S.
Official statements are yet to come but Chinese state media was eager to note that Silicon Valley and Wall Street giants were "losing sleep" over DeepSeek, which was "overturning" the US stock market.
"In China, DeepSeek's advances are being celebrated as a solid proof to the country's broadening tech prowess and self-reliance," says Marina Zhang, an associate professor at the University of Technology Sydney.
"The company's success is viewed as a confirmation of China's Innovation 2.0, a new generation of native technological initiative driven by a younger generation of entrepreneurs."
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