In 2025, the emergence of DeepSeek marked a significant turning point in the realm of artificial intelligence (AI). This innovation, molded by a homegrown team in China, caught global attention due to its technological prowess and visionary approachWhat initially started as a local endeavor quickly spiraled into a phenomenon that sent ripples throughout the international AI industry.

The impact of DeepSeek extended beyond mere discussion among tech enthusiastsIt unleashed a storm on the U.S. stock market, triggering dramatic drops in the share prices of industry giants like Nvidia, leading to a staggering loss of hundreds of billions in market capitalizationConsequently, this upheaval incited profound conversations regarding the status quo of the AI industryQuestions abounded: Had DeepSeek dethroned Nvidia from its pedestal? Were we witnessing a seismic shift in AI dominance?

The Technological Breakthroughs Behind DeepSeek

The rise of DeepSeek is attributed to groundbreaking technological innovationsConstrained by limited computational power, manpower, and time, the team accomplished systemic innovations and deep optimizations in several critical areas, including model algorithms, infrastructure, training methods, and foundational AI resources.

By integrating existing technologies with their proprietary developments, DeepSeek constructed an efficient, practical AI systemThis ambitious project embraced an open-source strategy, allowing global developers access to their technological results, which significantly contributed to the widespread application and evolution of AI.

Take, for example, the Deepseq R1 Zero modelThis innovative piece of technology leveraged a training methodology solely based on reinforcement learning, discarding the conventional supervised fine-tuning process

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As a result, the model exhibited enhanced capabilities in reasoning through complex problems while continuously learning and evolving from trial and error.

In stark contrast to the traditional opaque black-box approaches typically associated with AI, DeepSeek proudly showcased a transparent reasoning process that enhanced the interpretability of its modelsThis transparency has not only improved the efficiency of human-AI interactions but also cultivated a sense of trust among users.

Upon examining its architecture, DeepSeek has introduced multiple head latent attention technology (MLA) and mixture-of-experts models (MoE). The MLA significantly boosts computational efficiency by reducing the cache size limits in the attention mechanism, while MoE resolves convergence challenges during training by dividing the model into numerous expert modules, thereby utilizing computational resources more effectively.

The open-source strategy adopted by DeepSeek represents yet another highlight of its achievementsThe team opted to make core resources such as model parameters, training data, and research documentation openly accessibleThis bold move breaks the prevalent industry norm of cloistered development surrounding large models, ultimately facilitating greater cooperation and knowledge sharing across the global AI community.

The Challenge to Nvidia and Their Complex Relationship

The market fluctuations observed on January 27, particularly in the U.S. stock market, underscored the disruptive influence of DeepSeek on NvidiaThe substantial decline in Nvidia's stock price illustrated that DeepSeek had indeed redefined Wall Street's expectations regarding AI chips and reshaped the narrative surrounding the industry.

Historically, the Silicon Valley model has relied heavily on substantial investments in computational power as the primary driver of AI advancements, with Nvidia reigning supreme as the central supplier of this technology

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However, the low training and operational costs associated with DeepSeek compel the industry to reevaluate its strategies for developing AI chips.

Despite these challenges, Nvidia's technological barriers remain formidableTheir intellectual fortress encompasses three vital domains: hardware (GPU chips), software (the CUDA programming ecosystem), and networking (high-performance technologies such as Nvlink, InfiniBand, and Spectrum Max).

While DeepSeek employs PTX instructions for GPU programming in certain scenarios, it hasn't fundamentally breached the CUDA ecosystem's strongholdThe PTX framework, deeply entwined with Nvidia’s GPU architecture, confirms the extensive optimization potential of Nvidia’s technology through DeepSeek's applications.

Furthermore, in networking technology, although DeepSeek initially utilized PCIe for inter-chip connections and introduced the HF reduce framework, its latest Deepseq V3 version now supports and optimizes for Nvlink.

In terms of chip usage, DeepSeek still heavily relies on Nvidia’s GPUsWhile rumors of their own self-developed chips circulate, the reality remains that breaking free from Nvidia’s technological dependency is not feasible in the near term.

Thus, while DeepSeek presents a challenge to Nvidia’s dominance, it has yet to fundamentally disrupt the AI supremacy of the latterIt leans more toward offering innovative technological pathways and business models that introduce new development ideas and competitive dynamics to the industry.

Is This a National-Level Innovation?

Comments by Feng Ji, the producer behind "Black Myth: Wukong," regarding DeepSeek have stirred debates into whether this innovation can be classified as a national-level breakthroughFrom the perspective of technological advancement, DeepSeek's advent has significantly upgraded China's standing in AI globally, shrinking the gap between China and the world's leading edge in AI technology from two to three years to just a matter of months—a monumental milestone in China's AI evolution.

This success underscores the innovative capacity of local talents within China's AI landscape

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It illustrates that even amidst technological embargoes and resource limitations, significant breakthroughs can be realized, facilitating the development of a global AI ecosystem.

The triumph of DeepSeek signifies more than just a technical leap; it embodies a spirit of innovationIt challenges the traditional narrative which suggested that "the U.S. leads in pioneering innovation while China merely focuses on practical applications." Instead, it showcases China's intrinsic potential for innovation at the forefront of technology.

In the face of technological barriers and vast investment discrepancies, the DeepSeek team, armed with their resilience and superior technical acumen, demonstrates impressive achievements that establish a benchmark for China's technological advancement.

However, it is essential to recognize that while DeepSeek has made remarkable progress, it still operates within the existing large model paradigmThere remains the potential for newer technologies to eclipse current advancementsThus, it has yet to fully achieve a genuine leap beyond established international leaders.

Nevertheless, this does not diminish DeepSeek's valueAs a vanguard of AI innovation in China, it sets the groundwork for future advancements and inspires a wealth of innovative possibilities.

Though DeepSeek has not yet fully overturned Nvidia’s AI reign, it signifies a monumental shift within the AI landscapeWhether it qualifies as a national-level innovation remains to be seen, but the technological advancements and innovative spirit it embodies have undoubtedly infused new energy into both China and the global AI development narrative, heralding a new chapter in the progression of AI technologies.

Looking ahead, the trajectory of DeepSeek will profoundly influence the future of the AI industry

In terms of technological evolution, it is poised to further explore existing innovative pathways, optimizing model architectures and training algorithms.

Considering that the demand for computational power in AI technology continues to escalate, tackling the challenge of achieving more efficient calculations with limited resources remains a core objective for DeepSeek.

The team might focus more on hardware optimization and adaptation, exploring collaborations with a variety of chips to reduce dependency on a single supplier while enhancing overall performance.

From a market perspective, DeepSeek's open-source model appears to be contributing to the establishment of an expansive technological ecosystemAn increasing number of developers are leveraging the open-source code for secondary developments, giving rise to diverse application scenarios and solutions that not only enrich the boundaries of AI technology but also attract additional partners and resources to DeepSeek.

In commercial application domains, DeepSeek is primed to rapidly expand its market share in sectors such as intelligent customer service, content creation, and data analysisFor instance, in intelligent customer service, its clear reasoning mechanisms and efficient learning capabilities can facilitate more precise and intelligent customer interactions, enhancing user experiences and operational efficiency for businesses.

Simultaneously, DeepSeek’s success has sparked a burgeoning interest in AI entrepreneurship and research across ChinaEducational institutions and research organizations have flooded investments into the AI domain, training a stream of specialized talent and cultivating an environment ripe for innovationThis effort not only aids the overall enhancement of AI technology in China but also provides robust support for the sustainable development of the AI industry.

Nonetheless, challenges abound for DeepSeek

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