U.S. President Donald Trump has described the rise of the Chinese company DeepSeek as a “wake-up call” for the American tech industry, after the release of its AI model caused shockwaves on Wall Street.
The value of shares in major tech companies like Nvidia fell significantly. The chip giant saw a market value drop of nearly $600 billion, reports the BBC.
What rattled the industry is DeepSeek’s claim that its R1 model was developed at a much lower cost than that of its competitors—raising serious questions about the future of U.S. dominance in AI and the scale of investment American companies are putting into the field.
DeepSeek became the most downloaded free app in the United States just one week after its launch.
Reacting to the news on Monday, Trump said recent developments in the Chinese AI industry could actually be a positive thing for the U.S.
“If you could do it cheaper, if you could do it for less [money] and get the same result in the end, I think that’s a good thing for us,” he told reporters while aboard Air Force One.
He also said he is not concerned about the success of the Chinese company, adding that the U.S. will remain the dominant player in this field.