Chinese startup DeepSeek has launched R1, a low-cost AI model rivaling U.S. giants like OpenAI and Google. Trained for just $5.6 million, R1 soared to the top of Apple’s App Store, overtaking ChatGPT, and triggered a 3.9% Nasdaq drop Monday, with major tech stocks like Nvidia and Alphabet plummeting.
DeepSeek’s success has sparked concerns in Silicon Valley, though analysts note China lacks the infrastructure to match U.S. AI capabilities.
Meanwhile, the Biden administration has restricted chip exports to China, and President Trump announced “Stargate,” a $500 billion AI infrastructure project, aiming to maintain U.S. dominance in emerging technologies.
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