DeepSeek, a chatbot developed by a Hangzhou-based startup, has quickly established itself as a major contender in the artificial intelligence industry. In a space traditionally dominated by Western tech giants like OpenAI, Google, and Meta, DeepSeek's meteoric rise has attracted global attention.
Launched just last month, the AI tool has garnered widespread adoption, largely due to its remarkable cost efficiency. Unlike its Western counterparts, which have invested billions in AI research and development,
DeepSeek was developed with a mere $6 million—a fraction of what industry leaders typically spend.
Despite its relatively low development budget, DeepSeek has demonstrated performance that rivals leading AI models. Within weeks of its launch, it became the most downloaded app on Apple’s US App Store.
Additionally, it has surpassed ChatGPT in key international markets, including the UK, Canada, and Singapore. One of DeepSeek’s biggest draws is its affordability—offering a paid subscription for just $0.50 per month, a stark contrast to ChatGPT’s $20 subscription fee.
The emergence of DeepSeek has sent shockwaves through global financial markets, particularly in the AI and semiconductor sectors. Some of the biggest tech companies have experienced substantial losses due to concerns over China’s growing AI dominance.
In a dramatic market shift, Nvidia, a leading US chip manufacturer, lost nearly $600 billion in market value in a single day, marking the largest one-day drop for any company in US history.
US officials have expressed growing concern over China’s advancements in AI technology. President Donald Trump described DeepSeek’s rapid rise as a “wake-up call” for American industries, signaling the need for urgent investment in AI innovation. In response, his administration announced a $500 billion initiative called “Stargate”, aimed at strengthening the US AI infrastructure and maintaining American leadership in the sector.
Concerns over national security have intensified following DeepSeek’s launch. According to news sources, White House Press Secretary Karoline Leavitt confirmed that the National Security Council is actively assessing the security risks associated with DeepSeek.
She emphasized the administration’s commitment to ensuring the US remains at the forefront of AI innovation.
Similarly, Rep. John Moolenaar, head of the bipartisan House Select Committee on the Chinese Communist Party, has called for stricter export controls on technology that supports DeepSeek’s infrastructure, citing potential risks to US security.
Adding to the concerns, the US Navy has banned personnel from using DeepSeek, citing both security and ethical risks. A report by CNBC revealed that an internal directive was sent on Friday, warning service members against using DeepSeek “in any capacity” due to concerns about its origins and potential data vulnerabilities.
The directive, addressed to “shipmates”, highlighted the risks of foreign AI technology and its implications for national security.
A US Navy spokesperson confirmed the authenticity of the email, clarifying that the ban is in line with the Department of the Navy’s Chief Information Officer’s policy on generative AI.
Prominent academics and government officials worldwide have issued warnings about DeepSeek’s data security risks. Michael Wooldridge, an AI professor at the University of Oxford, advised users to be cautious about what they enter into the chatbot. Speaking to The Guardian, he explained:
“I think it’s fine to download it and ask about the performance of Liverpool football club or chat about the history of the Roman Empire. But would I recommend putting anything sensitive, personal, or private on them? Absolutely not… Because you don’t know where the data goes.”
In addition to security concerns, UK Technology Secretary Peter Kyle has raised red flags regarding DeepSeek’s built-in censorship. Unlike Western AI models, DeepSeek operates under regulations set by Chinese authorities, leading to potential content restrictions. Speaking on The News Agents podcast, Kyle stated:
“I think people need to make their own choices about this right now because we haven’t had time to fully understand it.”
The Australian government has also joined in on the concerns. Treasurer Jim Chalmers advised citizens to exercise caution when using DeepSeek and confirmed that the government is actively monitoring the technology.
DeepSeek’s rapid rise signals a major shift in the global AI landscape, challenging the dominance of US and Western tech giants. As China continues to push forward with AI innovation, governments and financial markets around the world will closely monitor how this development reshapes the industry.
With ongoing geopolitical tensions and national security concerns, the debate over foreign AI models is expected to intensify. The coming months will be crucial in determining whether DeepSeek will be embraced globally or face further restrictions.