DeepSeek, a Chinese artificial intelligence startup, has sent shockwaves through the tech world with bold claims that it can match or even surpass the performance of AI models from top U.S. firms like OpenAI while significantly undercutting them on price by using less powerful chips. Prominent figures in the AI world are skeptical of these claims, including one CEO who says the Chinese company has 50,000 of the forbidden Nvidia H100 chips.
The emergence of DeepSeek, a relatively unknown Chinese AI company, has sparked both excitement and skepticism across the artificial intelligence industry. In a stunning announcement, the startup claimed that its AI models can achieve performance on par with or even exceeding that of cutting-edge systems developed by U.S. companies such as OpenAI. However, what truly sets DeepSeek apart is its assertion that it can offer this impressive capability at a fraction of the cost of its American counterparts. This claim caused a wave of panic selling on Monday, causing AI high flyer stocks like Nvidia to crash.
Now, AI thought leaders are throwing cold water on DeepSeek’s claims. Among them is Scale AI CEO Alexandr Wang, who claims that DeepSeek is covertly using Nvidia’s high-performance H100 chips, despite US export restrictions that limit their availability to China. The revelation has ignited a heated debate about the future of AI innovation and the impact of US regulations on the global tech landscape.
According to Wang, DeepSeek is currently utilizing around 50,000 Nvidia H100 GPUs, a significant number considering the export controls in place. He further stated that DeepSeek workers are unable to publicly discuss their use of these chips due to the US regulations. After a clip of Wang’s statement was posted to X, Elon Musk replied agreeing with Wang’s assertion.
Obviously
— Elon Musk (@elonmusk) January 27, 2025
Skepticism continues to grow in other areas as well. Fortune reports:
Ted Mortonson, a managing director and tech strategist at Baird, also doubts DeepSeek could have built its model with reduced-capacity H800 chips. He also thinks the reaction to DeepSeek’s supposed innovations are overblown, suggesting American firms could have pursued such a model if they wanted.
“We’ve got some of the best AI engineers in the world sitting in the U.S.,” he said, “and to say that they haven’t looked at this on open source and optimization is kind of ludicrous, if you think about it. So, I don’t personally really put a lot of trust into what Chinese companies are saying.”
Initially, it was believed that DeepSeek was using Nvidia’s lower-performing H800 chips. However, if Wang and Musk are correct that the startup is leveraging the banned H100 chips, it raises questions about the effectiveness of US regulations in the AI space and the potential for Chinese innovation to challenge global AI leadership. While using the H100 chips could slightly diminish the appeal of DeepSeek’s model, its performance remains impressive, and the startup, along with others like Qwen, is now competing at a high level with US companies in a landscape traditionally dominated by the West.
Breitbart News will continue to report on DeepSeek.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.
