Trump Calls China’s DeepSeek AI ‘Wake-Up Call’ For U.S

US President Donald Trump has called the rise of China’s DeepSeek AI a “wake-up call” for the US tech industry after the company’s R1 model, developed at a fraction of the cost of its rivals, shook Wall Street.

Following the news, Nvidia, the chip giant, saw its market value drop by nearly $600 billion.

DeepSeek’s R1 model, launched this month, claims comparable performance to leading AI systems but at a cost of just $6 million, far below the billions spent by competitors. The app has quickly become the most downloaded in the US, raising concerns about the future of America’s AI dominance.

Trump responded that cheaper AI production could benefit the industry while asserting confidence in America’s continued leadership. However, Australian officials have urged caution, citing cybersecurity and data privacy concerns.

DeepSeek, founded in 2023 by Liang Wenfeng in Hangzhou, credits its success to software efficiency and collaboration among Chinese developers to overcome restrictions on advanced chip imports. Its model uses 2,000 chips for training compared to an estimated 16,000 for US systems.

The platform has faced subtle criticisms despite its immediate impact. Tech Mogul, Elon Musk recently responded in the affirmative, to a post which claimed that DeepSeek actually has around 50,000 Nvidia chips that have now been banned from export to China.

DeepSeek’s emergence highlights China’s growing competitiveness in AI, but following Trump’s recent $500m proposed investment in AI, the US is expected to remain dominat in the tech industry.

Trump Calls China’s DeepSeek AI ‘Wake-Up Call’ For U.S is first published on The Whistler Newspaper