How DeepSeek sent shockwaves across the world
How DeepSeek sent shockwaves across the world
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Why is DeeSeek better than ChatGPT?. The emergence of Chinese artificial intelligence firm DeepSeek rocked US tech giants’ stocks on Monday night amid fears that the new low-cost AI model would upend their dominance. Tech shares plunged and chip maker Nvidia suffered falls of nearly 17% on Monday, as President Donald Trump warned DeepSeek’s emergence was a “wake up call” for existing AI giants.
![[DeepSeek overtook OpenAI’s ChatGPT in January 2025 to become the top-rated free app in Apple’s App Store in the US]](https://static.independent.co.uk/2025/01/27/11/deepseek-chinese-ai-meta.jpg)
Nvidia’s drop in share price marked the biggest ever one-day loss in market value on Wall Street, of about 589 billion dollars. Just a week after its launch, DeepSeek has quickly become the most downloaded free app in the US. It claims that its large language AI model was made at a fraction of the cost of its rivals, including OpenAI, which uses more expensive Nvidia chips to train its systems on vast swathes of data.
![[A man using ChatGPT on a mobile phone]](https://static.independent.co.uk/2025/01/22/08/21163628-e5b0716c-2058-458f-aae3-4ddf202c71c6.jpg)
The announcement has raised significant doubts over the future of US firms’ dominance in AI, prompting the sharp falls for Nvidia, as well as tech giants including Microsoft, Meta and Google parent Alphabet, which are all pouring billions into the technology.
![[Sam Altman, chief executive officer of OpenAI]](https://static.independent.co.uk/2025/01/20/15/SEI236681840.jpg)
The S&P 500 dropped 1.5%, dragged down in large part by the fall from Nvidia. DeepSeek’s claims also affected tech stocks elsewhere, with Dutch chip making company ASML falling 7% and Japan’s Softbank dropping 8.3%. The FTSE 100 appeared resilient on Tuesday morning, rising 0.21% in early trading.
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