Global Markets Shake as Low-Cost Chinese AI Model Emerges

The launch of a low-cost AI model by Chinese startup DeepSeek has triggered a global market rout, particularly impacting Japanese tech shares. The competitive model challenges AI giants like Nvidia, sparking a significant selloff. DeepSeek's efficient AI model questions previous perceptions of Chinese AI capabilities.

Global markets experienced significant upheaval as DeepSeek, a Chinese startup, introduced an affordable AI model, leading to a decline in Japanese tech shares. Investors reacted strongly, questioning AI firms' high valuations and prompting notable selloffs, with Nvidia taking a major hit.

The unexpected efficiency and low cost of DeepSeek's AI model surprised industry players, including OpenAI's CEO Sam Altman, who acknowledged the competition. The disruption underscored concerns regarding the inflated valuations of tech companies heavily invested in AI development.

DeepSeek's ascendancy marks a shift in the perception of Chinese AI capabilities, prompting international attention and discussions on competitive dynamics within the industry.

(With inputs from agencies.)