While Donald Trump has been threatening to destroy the Chinese market by imposing 100% tariffs on Chinese goods like a fool, a mere Chinese startup company has launched a low-cost artificial intelligence model that wiped out $1 trillion from the American stock market in just one day.
By introducing the chatbot model DeepSeek-R1, or an artificial intelligence revolution, China has instantly shattered the global dominance of the American tech industry.
After its launch on January 20, and by January 27, the DeepSeek-R1 chatbot model has been downloaded on iPhones and Android phones at such an unprecedented rate that AI models like ChatGPT, Gemini, and Claude AI, which had previously dominated the AI world, are now being completely sidelined by users.
DeepSeek has shaken Silicon Valley, the heart of the American tech sector, like a massive earthquake, crushing American technological arrogance and dismantling its stock market empire.
At this moment, the U.S. is experiencing a mass panic similar to the “Sputnik Crisis” of the Cold War era. Not only are political and social sectors alarmed, but major tech giants like Google, Meta, and OpenAI are also terrified.
In the tech world, China’s DeepSeek has struck America’s dominance like a Mike Tyson punch to its face.
Until now, when people thought of AI, they thought of ChatGPT—an AI chatbot that even ordinary mobile users could access. Indian Chief Ministers have even publicly demonstrated ChatGPT’s use by having it write poems in public meetings, proving that AI was within reach of the common man.
However, a 40-year-old Chinese entrepreneur, Liang Wenfeng, has introduced a chatbot model, DeepSeek-R1, which is far more intelligent, more powerful, and truly free—an “open-source reasoning AI chatbot” that surpasses ChatGPT in capability.
Forget about users from other countries—even American users have embraced DeepSeek-R1 at an explosive rate over the last seven days, leaving ChatGPT, Gemini, and Claude AI far behind in the race.
Even Meta’s AI, which provides a relatively dumb chatbot integrated into WhatsApp for users, is nowhere near DeepSeek.
Within just seven days, DeepSeek has gained millions of new daily users, causing a hurricane in the world of technology.
Significantly, the very day Donald Trump assumed the U.S. presidency, China launched DeepSeek-R1 into the market.
The Rise of DeepSeek: The Chinese AI That Stunned the World
DeepSeek was founded in 2023 in Hangzhou, China, by 40-year-old tech expert Liang Wenfeng. Initially, it was just a startup company with no prior experience in developing AI models.
However, within an extremely short time and with a remarkably low budget, Wenfeng’s company introduced an advanced Large Language Model (LLM) AI to the market.
After launching a few experimental models, DeepSeek-R1 was finally introduced on January 20, and it has since taken the tech world by storm with its unparalleled intelligence.
How Much Did DeepSeek Cost?
Wenfeng spent only $5.6 million (approximately ₹50 crore INR) to develop DeepSeek.
In contrast:
OpenAI has spent over $1 billion on ChatGPT.
Google’s Gemini AI Ultra model has cost a staggering $19.1 billion to develop.
How did Wenfeng create such a powerful AI model with so little time and money? This question has left American tech companies and investors completely dumbfounded.
The Cost of AI Development and Training
A significant portion of AI development costs is spent on training—the process of making AI models more intelligent and capable.
To achieve high intelligence, an AI model requires at least two years of training, during which vast amounts of data are fed into it.
Storing and processing such massive datasets requires powerful GPUs (Graphics Processing Units), which are extremely expensive.
The larger the data, the more powerful the AI, and the better it can provide accurate answers.
Without vast data resources, an AI would be no better than a basic search engine.
The Role of U.S. Sanctions and Nvidia Chips
The U.S. had imposed a ban on selling high-performance Nvidia chips to China, intending to prevent China from surpassing the U.S. in AI technology.
However, before the ban, Liang Wenfeng had already acquired an estimated 10,000 Nvidia chips, which are believed to have played a crucial role in DeepSeek’s rapid success.
On Tuesday, as a direct result of DeepSeek’s success, Nvidia’s stock market value plummeted by $600 billion—the largest single-day market value drop in history.
What Makes DeepSeek So Powerful?
DeepSeek enables:
Deep learning (advanced machine learning capabilities)
Limitless data analysis
Automated data processing
Business intelligence solutions
Enhanced research and analytics
While traditional AI models struggle to provide accurate answers, DeepSeek has far superior intelligence and efficiency, offering users a truly advanced AI experience.