DeepSeek: The Chinese AI model shaking up the tech world
You've probably been hearing a lot about China's new AI, DeepSeek. Here's a basic breakdown of what makes it so special and why it has the tech world in a frenzy.
A new AI model from China, DeepSeek, has taken the tech world by storm. Since its latest release on January 20, 2025, it has stunned investors and even taken ChatGPT’s job.
Who would’ve thought AI would lose its job to AI?
However, the question on most people’s minds is what makes DeepSeek so special – and why is everyone talking about it? Well, let’s answer some of your burning questions.
What is DeepSeek?
DeepSeek is an AI-powered chatbot, much like ChatGPT, capable of handling various tasks such as answering questions, coding, and mathematical problem-solving. However, what sets it apart is its efficiency and low cost.
Unlike models built by OpenAI, which require high-end computing power, DeepSeek was reportedly developed using less advanced computer chips, which made it significantly cheaper.
The company claims it costs just $6 million (R111 million) to train, which is far less than the $100 million+ (R1.8 billion+) estimated for OpenAI’s GPT-4.
What’s even crazier is how quickly China was able to create this AI Model. OpenAI spent years developing and training ChatGPT whereas DeepSeek was created in just a few months, and it’s way more advanced.
OpenAI claims to have evidence that DeepSeek used ChatGPT’s data model to build and train their AI.
This breakthrough sent shockwaves through the tech industry. The idea that a low-cost AI model could rival industry leaders caused investors to panic, leading to Nvidia losing nearly $600 billion (R11 trillion), the biggest one-day loss in US history.
Who’s behind DeepSeek?
DeepSeek was founded in December 2023 by Liang Wenfeng, a Chinese entrepreneur with a background in finance and AI development. Unlike many Silicon Valley AI pioneers, Wenfeng built his career in quantitative trading, using AI to analyse financial markets.
His hedge fund, High-Flyer, was the first in China to raise over 100 billion yuan (R241.9 million).
Wenfeng has long believed that China should lead, not follow, in AI innovation. His success with DeepSeek proves that advanced AI can be developed without relying on cutting-edge technology from the West.
How has DeepSeek impacted the AI race?
DeepSeek’s rise has put the US on high alert. President Donald Trump called it a “wake-up call”, urging American companies to focus on staying competitive.
Washington has spent years trying to limit China’s access to advanced chips, believing this would slow Beijing’s AI progress. However, DeepSeek’s success suggests that China is finding ways to innovate despite restrictions.
Chinese state media has celebrated DeepSeek’s breakthrough, calling it proof of the country’s technological independence. However, some experts warn that this growing divide between China and the West could lead to “tech isolationism” – where the two AI superpowers develop separate systems that are incompatible with each other.
DeepSeek’s success challenges the belief that bigger budgets and cutting-edge chips are essential for AI breakthroughs. It has also disrupted financial markets, proving that tech innovation can have far-reaching economic consequences.
While it remains to be seen whether DeepSeek can match the performance of OpenAI’s top models, one thing is clear: China is no longer just following in the AI race, they’re leading it.
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