DeepSeek Takes Over the Market

DeepSeek is a Chinese artificial intelligence lab that has rapidly emerged in the tech landscape. Founded in 2023 as a spin-off from High-Flyer Capital Management, a quantitative hedge fund, DeepSeek has made significant advancements in the field of AI. Its models, such as DeepSeek Coder and DeepSeek LLM, gained international attention, especially after the launch of the DeepSeek-V2 model family. This text and image analysis system surpassed various benchmarks, exhibiting superior performance to similar models at significantly lower costs. Its capabilities forced competitors like ByteDance and Alibaba to lower their service prices or make them free.

A distinctive feature of DeepSeek is its development model. The company built data center clusters for model training but faced limitations due to U.S. export restrictions on hardware. Despite this, DeepSeek's technical team is largely made up of young researchers, and the company hires individuals without computer science backgrounds, fostering a broader understanding of various disciplines. Another innovative model is DeepSeek R1, launched in January 2025, which stands out for its self-verifying capability, improving reliability in responses on complex topics such as physics and mathematics.

However, DeepSeek's models, being developed in China, must comply with local regulations, limiting their freedom to respond to sensitive topics like Tiananmen or Taiwan's autonomy. Despite uncertainties regarding its business model, DeepSeek has attracted attention from developers who have created over 500 derivative models, significantly increasing their applications. The growing popularity of DeepSeek has notably impacted the market, influencing Nvidia's stock and generating reactions from prominent figures in the tech sector. While its growth has been rapid, there are concerns about potential government restrictions and competition in the AI sector, making DeepSeek's future uncertain.