DeepSeek: A Wake-Up Call for U.S. AI Industry Amidst Security Concerns

The U.S. is investigating the national security risks of China's AI app DeepSeek, amid concerns of intellectual property theft and market impact. Officials urge American AI leadership to maintain focus in the face of growing competition. Export restrictions on AI technology aim to curb China's advancement.

U.S. officials are examining the national security ramifications of the Chinese AI app DeepSeek, with White House press secretary Karoline Leavitt noting on Tuesday that the National Security Council is involved in the review. This action follows comments from President Donald Trump's crypto czar warning of possible intellectual property theft.

Investors have shown concern by offloading technology stocks globally, fearing the cheaper Chinese model could unseat U.S. AI leaders like OpenAI and Google's Alphabet. In response, the White House is emphasizing the need for U.S. companies to maintain AI dominance.

David Sacks, the White House's AI czar, pointed out on Fox News that techniques like AI distillation, where models learn from one another, might be a factor in DeepSeek's rise. To counteract this, U.S. companies may look into strategies to prevent the spread of such copycat models. Meanwhile, efforts to restrict AI chip exports to China continue under the direction of Trump's designated Commerce Department leader, Howard Lutnick, who faces a nomination hearing soon.

(With inputs from agencies.)