Deepseek AI: What is it and why it is Trending Now?

Everybody thought ChatGPT, Claude AI and Gemini would be the future.

Until Jan 20, 2025.

On that day, the Chinese company launched a model, which broke the internet as well as the American stock market [AI Market].

Any AI Companies in the world didn’t see this coming. and this drives the world crazy.

In this blog, I am going to cover everything you need to know about Deepseek AI and its impact.

Let’s dive in.

What is Deepseek AI?

DeepSeek, A Chinese AI company founded in 2023 by Liang Wenfeng, has rapidly emerged as a significant player [trending just like chatGPT did] in the AI Industry. DeepSeek says their AI is as good as the AI made by big American companies like Google and OpenAI. But they also say their AI is much cheaper to build and use.  

Lots of people are getting excited about DeepSeek AI after releasing their cost-efficiency models I.e. DeepSeek-V3 and DeepSeek-R1.

DeepSeek’s AI assistant has become incredibly popular very quickly, even beating ChatGPT on the iPhone app chart.

It’s praised for being fast, efficient, and smart, and it uses less advanced computer chips than similar AI from American companies.

This makes some people wonder if the US is the leader in AI like everyone thinks.

But what happens next?

A Team Behind Deepseek AI

Liang Wenfeng, an AI enthusiast, co-founded High-Flyer in 2016, a hedge fund using AI trading algorithms.

By 2021, they exclusively used AI for trading. DeepSeek’s AI chatbot is open source, meaning anyone can use and change its code. Liang had a large stock of Nvidia GPUs (likely thousands) before the US restricted chip exports to China.

In 2023, High-Flyer created an AI research lab, which then became the independent company DeepSeek, with High-Flyer as an investor. Venture capitalists were hesitant to invest initially.

DeepSeek’s release of the low-priced, high-performing DeepSeek-V2 in 2024 sparked an AI price war in China.

They became known as the “Pinduoduo of AI” (referencing a discount e-commerce platform), prompting other tech giants like ByteDance, Tencent, Baidu, and Alibaba to lower their AI model prices. Despite these low prices, DeepSeek is profitable, unlike its competitors.

DeepSeek focuses only on research and has no clear commercialization plans. This also allows it to avoid some of China’s stricter AI regulations.

DeepSeek prefers to hire people based on technical skills rather than experience, often hiring recent graduates or less-established AI developers.

They also hire people without computer science backgrounds to broaden their AI’s understanding of different subjects, like poetry and performing well on tough exams.

Deepseek V3 vs Other Top AI Models

Deepseek V3 is better than other models and they have compared to their website itself. I haven’t compared them yet, once it is done, I will upload a separate article on that.

But People are going crazy on the internet claiming Deepseek AI is the best in the market for various tasks compared with other AI models.

Let me know in the comments about your experience of using Deepseek AI.

Why is Deepseek AI Affecting Tech Stocks in the USA, Japan and Europe?

DeepSeek, a new AI company, is making waves and causing some jitters in the stock market. Here’s why:  

• They’re doing things differently: DeepSeek says their AI is as good as what the big American companies make, but it’s much cheaper. This makes people wonder if the old way of making AI (which is very expensive) is the best.

• They’re getting popular: Lots of people are downloading DeepSeek’s AI helper app. This makes investors worry that DeepSeek might take away customers from other companies.  
• They might use fewer chips: DeepSeek says they don’t need the most expensive computer chips. This is bad news for companies like Nvidia that make those chips, because they might sell fewer of them.
• They’re from China: Because DeepSeek is Chinese, there are worries about what the governments might do. Sometimes governments block or restrict Chinese tech companies, and this makes investors nervous.  

Basically, DeepSeek is new and different, and that’s making investors unsure about what the future of AI will look like. This uncertainty is causing tech stock prices to go up and down.

What about Privacy?

Luke de Pulford Said on Twitter that “Deepseek AI collects your IP, keystroke patterns, device info, etc etc, and stores it in China, where all that data is vulnerable to arbitrary requisition from China.”

Here’s their privacy policy from their website.

Is Deepseek AI another Tiktok or Huawei for America?

Deepseek AI is trending and everyone speaking about that

However, because DeepSeek is from China, there are concerns about user privacy. Even though many people are downloading it, the US government is worried about Chinese tech and might step in.

Think about what happened to TikTok and Huawei – the US government took action against them. Huawei phones aren’t even sold in the US anymore.

DeepSeek being open source (meaning anyone can use its code) might offer some protection, but the app itself could still be blocked.

The US government might see DeepSeek as a threat to American companies, just like Huawei was a threat to Apple and TikTok is a threat to Facebook and other social media companies. There’s also an “AI arms race” going on, and the US wants to win.

Just recently, the previous US President announced that American companies OpenAI and Nvidia are important partners in a new AI project. These companies have been affected by DeepSeek’s popularity. ChatGPT dropped in the app charts, and Nvidia’s stock price went down.

The previous US President has always been very protective of American businesses. It’s sometimes hard to tell the difference between a company that’s a “national security threat” and one that’s just competition. Chinese companies in the US have to be very careful to avoid trouble.

There are already questions about DeepSeek because it seems to censor answers about some historical events in China. This could be used as an excuse to ban the app in the US.

Fighting the US government is hard. TikTok and Huawei spent a lot of time and money trying to argue their cases. DeepSeek will need a lot of money if it faces a similar situation. Even if people love DeepSeek and think it’s better than other AI assistants, that might not matter.

History shows that Chinese tech can disappear from our lives very quickly. So, even if you like DeepSeek, don’t get too used to it being around, at least not in the US.

Let’s wait and watch, How Open AI, Google and other AI Companies going to respond to this.

If you have any doubts or thoughts, let me know in the comments.