News View Non-AMP

AI Coin Bloodbath! DeepSeek’s Low-Cost Models Trigger Market Panic

Published by
Sohrab Khawas

The AI coin market took a hit earlier today after a surprising move from a Chinese startup, DeepSeek, which is shaking up the industry with its incredibly affordable AI models.

This bold challenge to U.S. tech giants has sent shockwaves through the market, with popular AI tokens like Near Protocol (NEAR), Internet Computer (ICP), Render (RENDER), and Filecoin (FIL) all taking significant losses, contributing to a broader 7.66% market cap loss, which fell below $44 billion.

But what makes DeepSeek so different, and why are investors so rattled?

Let’s dive into how this emerging player could be a game-changer in the world of AI.

DeepSeek’s Competitive Edge Shakes Silicon Valley

What sets DeepSeek apart is its ability to deliver high-performance AI at a much lower cost. While U.S. companies like OpenAI and Anthropic invest over $100 million to build AI models like GPT-4 and Claude, DeepSeek has achieved similar results for just $6 million. Despite using less advanced AI chips, its efficiency is turning heads, particularly as its app climbs to the top of the Apple Store rankings.

Arthur Hayes, former CEO of BitMEX, suggested that DeepSeek’s rise could make global investors rethink their reliance on U.S. tech and bonds. This challenge to U.S. dominance in AI and technology is starting to gain attention, with Nasdaq 100 futures dropping 2%, and tech stocks like Nvidia, Qualcomm, and Broadcom seeing declines.

A “Buy the Dip” Moment?

Despite the sharp market correction, some analysts see this as a “buy-the-dip” opportunity. Daniele, a well-known market analyst, believes DeepSeek’s affordability could help scale AI applications worldwide by lowering entry barriers for users. Instead of hurting the AI coin market, he argues DeepSeek’s innovation could drive growth in the industry.

DeepSeek Gains Ground in Global AI Benchmarks

DeepSeek’s rapid growth is reflected in its strong performance in global AI benchmarks like AIME, MATH-500, and GPQA. While OpenAI’s ChatGPT still leads in some areas, such as coding, DeepSeek’s performance gap is closing, signaling a shift in the market.

In response to DeepSeek’s rise, Meta has set up an emergency team to address the threat posed by China’s cheaper and more efficient AI models. With prices 17 to 27 times lower than competitors, DeepSeek is poised to dominate the market—unless top companies act quickly.

The world of AI has just become a lot more competitive, and DeepSeek is making sure no one can ignore its impact.

Sohrab Khawas

Sohrab is a passionate cryptocurrency news writer with over five years of experience covering the industry. He keeps a keen interest in blockchain technology and its potential to revolutionize finance. Whether he's trading or writing, Sohrab always keeps his finger on the pulse of the crypto world, using his expertise to deliver informative and engaging articles that educate and inspire. When he's not analyzing the markets, Sohrab indulges in his hobbies of graphic design, minimal design or listening to his favorite hip-hop tunes.

Recent Posts

Dogecoin (DOGE) Price Analysis and Short-term Targets

The wider altcoin market, led by Dogecoin (DOGE), recorded a mild retrace in the last…

June 5, 2025

Coinbase to List PancakeSwap ($CAKE): Will This Trigger a Bullish Price Surge?

Coinbase Global Inc. (NASDAQ: COIN) announced plans to list PancakeSwap ($CAKE) in the near future.…

June 5, 2025

Treasure Global Announces $100M Digital Asset Treasury Strategy to Invest in Bitcoin and Ethereum

Treasure Global Inc. (NASDAQ: TGL), a United States-based tech company focused on developing consumer intelligence…

June 5, 2025

Bitcoin Breakthrough: JPMorgan to Offer Crypto Services Despite Jamie Dimon’s Past Criticism

JPMorgan Chase & Co. (NYSE: JPM), a top-tier financial institution with a sprawling global presence,…

June 5, 2025

Future Pepe Launches Revolutionary Meme Coin Presale With AI Security and Instant Staking Rewards

Future Pepe has officially launched its presale, initiating an ambitious mission to safeguard meme coin…

June 4, 2025

Crypto Regulations in the United Kingdom 2025

The United Kingdom is moving toward stronger cryptocurrency regulations. The government is working on new…

June 4, 2025