US President Donald Trump had been in office scarcely a week when a new Chinese artificial intelligence (AI) app called DeepSeek jolted Silicon Valley.
Overnight, DeepSeek-R1 shot to the top of the Apple charts as the most downloaded free app in the US.
The firm said at the time its new chatbot rivalled ChatGPT. Not only that. They asserted it had cost a mere fraction to develop.
Those claims – and the app's sudden surge in popularity – wiped $600bn (£446bn) or 17% off the market value of chip giant Nvidia, marking the largest one-day loss for a single stock in the history of the US stock market.
Several other tech stocks with exposure to AI were caught in the downdraft, too.
DeepSeek also cast doubt on American AI dominance. Up until then, China had been seen as having fallen behind the US. Now, it seemed as though China had catapulted to the forefront.
Venture capitalist Marc Andreessen referred to the arrival of DeepSeek-R1 as "AI's Sputnik moment," a reference to the Soviet satellite that had kicked off the space race between the US and the USSR more than a half century earlier.
