DeepSeek rattled the financial heartland of the US and damaged a stock market darling when it burst into public view. The Chinese startup was not a secret but it has now changed AI forever.
When China's first foray into artificial intelligence roared into the public domain, it dealt a blow straight to the financial heartland of the United States.
Nvidia's technological prowess had supercharged the American company and made it one of the world's three most valuable at the end of 2024. It even managed to set a record in the process, with a 17 per cent fall in its share price bestowing it the honour of having the biggest loss on a single day in the history of the US stock market.But DeepSeek's arrival had an even deeper impact — and its launch signalled that the global AI race was about to go into overdrive.It may have only made headlines recently, but the business is the product of years of quiet work behind the scenes.
High-Flyer had hired young, smart PhD graduates for its algorithmic trading, and after apologising to investors for its underperformance in 2021, Liang seemingly changed tack. "Many people in the US had thought that's going to be enough to tie their hands behind their backs and prevent them from being able to build the state-of-the-art models. And it turned out they were wrong," Professor Walsh said.
DeepSeek may have become a recognisable name after rattling Wall Street, but the company's AI chatbot launched in December with little fanfare. making the case for shorting Nvidia stock, and was shared by some heavy-hitting venture capitalists and hedge fund founders. DeepSeek appears to have debunked one of the tech world's holiest scriptures, but it may be too soon to believe the hype., Mr Emmanuel said while the market expected progress, "they expect it to be somewhat predictable".
"How come they weren't talking about competitive threats? They certainly didn't figure out this is going to be really important."As quickly as it had launched, scepticism about DeepSeek's ability to create an AI chatbot that required less time, money and energy followed.Photo shows A phone with DeepSeek on it. Behind it is a screen with ChatGPT
Its country of origin would also attract cynicism, he said, referring to the software as "ChatCCP" — a moniker combining rival chatbot ChatGPT and the Chinese Communist Party. The rapid pace of the platform's development might have created "weak spots", Mr Nazarovas said, while its use of older hardware could also be a factor.
Adding to the geopolitical tension are the chips themselves, which are manufactured in Taiwan based on Nvidia's designs.It followed a separate report that "I think that the initial market reaction was overblown," Armina Rosenberg from Minotaur Capital told The Business on Wednesday. "When it's come back, it gives people an opportunity to participate in those AI names at more reasonable valuations.
"The release of DeepSeek AI from a Chinese company should be a wake-up call for our industries, that we need to be laser-focused on competing to win," he said.
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