A Chinese AI DeepSeek has shaken the world.

Hello, friends!

A Chinese AI DeepSeek has shaken the world.

American tech companies and the US stock market have been shocked to such an extent that they couldn't have ever imagined.

"The release of DeepSeek AI from a Chinese company should be a wake-up call."

A Chinese research lab launched its AI chatbot. It is named DeepSeek R1. Along with it, they published the research paper where they stated that this chatbot is much better than the most advanced chatbots in the world across benchmarks like math and reasoning.

This includes OpenAI's ChatGPT o1 model, Meta's Llama, Google's Gemini Advanced—it has overthrown all of them.

DeepSeek is the best in terms of performance, it's the most efficient, and it took only a fraction of the time and money to develop it.

But the most amazing thing is that using it is completely free of cost for all of us.

On the other hand, OpenAI is charging $200 per month to use its ChatGPT o1 Pro model.

Not only that, the cost of training DeepSeek is reported to have been only $5.6 million.

Whereas other American companies—whether it is OpenAI, Meta, or Google—are spending billions of dollars to develop their artificial intelligence models.

Coincidentally, a while back when OpenAI's founder Sam Altman was asked whether foundational AI models like ChatGPT can be made by Indians in India:

"But if we wanna build foundational models, how should we think about that? With, you know, not a $100 million, but let's say $10 million. Could we actually build something truly substantial?"

He answered arrogantly that no one can do it except them. People can try, but he said that it would be 'hopeless.'

"It's totally hopeless to compete with us in training foundational models. You should try and like, it's your job to try anyway."

Today Sam may be feeling hopeless because just a week after DeepSeek's launch, DeepSeek became the most downloaded app in the US on the App Store and Google Play Store.

It has left behind ChatGPT.

The next day, in India and other countries as well, it became the number one app on the app store.

And it had disrupted the American financial markets.

"The launch of DeepSeek, which is a Chinese-built chatbot, immediately rattled investors and wiped out a staggering $1 trillion off the US tech index."

Before DeepSeek was launched, the most valuable company in the world was NVIDIA, valued at $3.5 trillion.

But in just one day, it dropped to $2.9 trillion.

This is a computer chips manufacturing company, which specializes in making those computer chips that can be used to train and operate AI.

NVIDIA's shares fell 17% in a single day and its valuation lost $589 billion.

This is the biggest loss faced by any company in history.

The benchmark of US tech companies, Nasdaq, dropped 3.1%.

But why did NVIDIA suffer such a big loss specifically?

We'll talk about the interesting reason later in this video.

But before that, let's find out the story behind DeepSeek.

Where did this AI come from, and why has it shocked the entire world?

The credit for developing DeepSeek goes to a 40-year-old Chinese entrepreneur, Liang Wenfeng.

Look at his face carefully because you will hardly see him anywhere.

He rarely makes public appearances and prefers to keep his identity hidden.

There's not much information about his life and history available to the public.

But we do know that he founded a hedge fund called High Flyer. It used mathematics and AI to make investments.

Later, he founded High Flyer AI to research Artificial Intelligence Algorithms.

He used the money he was earning from his hedge fund to start a side project of creating an AI model.

Liang said that he wanted to create his own AI model, which would be better than all the existing AI models in the world—simply because of scientific curiosity.

He did not aim to make money and earn lots of profit.

To make this AI model, when he started to gather his research team, he did not hire engineers.

Instead of engineers, he hired PhD students from China's top universities.

To train his AI model, he used the most difficult questions around the world.

And within just a few years and after spending a few million dollars, he launched his DeepSeek R1 model.

"It's super impressive."

"I think we should take the development out of China very very seriously."

"DeepSeek just taught us that the answer is less than people thought."

"We don't need as much cash as we once thought."

Only a few hundred people were involved in making it, and the vast majority of them were under 30 years old.

Compare this to a company like OpenAI, which has more than 3,500 employees.

Today, DeepSeek is China's only AI firm that is not funded by tech giants like Baidu, Alibaba, and ByteDance.

It's quite interesting to understand its architecture.

DeepSeek is a Chain of Thought model, just like OpenAI's ChatGPT o1 model.

That's a Chain of Thought model too.

The naming can get quite confusing because ChatGPT has a weird naming system for its models.

So for a basic understanding, let me tell you that the first publicly launched model was ChatGPT-3.

Then they launched GPT-4. It was much better than GPT-3.

And then we got GPT-4o, a multimodal version of GPT-4.

Not only could you chat with it using text, but you could actually speak to it, send photos, it could analyze photos, and even generate photos for you.

That's why it's called multimodal.

Then OpenAI launched its o1 model.

It was the first model based on 'Chain of Thought.'

When you asked questions, it tried to 'think' while answering.

And by 'thinking,' we mean that whenever it generated an answer, before giving you the answer, it 'thinks' about the possible counter-questions to check whether the answer it generated could be improved.

It analyzed each answer from different angles before answering your question.

This is known as 'Chain of Thought.'

It attempts to copy humans' reasoning process.

For example, if you ask ChatGPT 4o, "9.11 and 9.9 which one is bigger?" It answers without thinking too much that 9.11 is bigger than 9.9, which is wrong.

But when you ask the same question to ChatGPT o1, it thinks first.

Before giving you its answer, it counter-questions itself.

Whether the answer is correct.

In my case, it kept thinking for a while. But the final answer was correct—9.9 is actually bigger.

If you ask the same thing to DeepSeek, you will get the right answer.

Older AI models had a huge shortcoming.

But the Chain of Thought process has now removed this shortcoming.

This is why models like o1 and DeepSeek are being called Advanced Reasoning Models.

They are much better at logically answering questions.

Another positive aspect of DeepSeek is that it shows you exactly what it's thinking, step by step and in great detail, before answering.

Similarly, if you want more in-depth knowledge about AI chatbots and want to upskill yourself in this field, my AI chatbot course can help you master AI chatbots.

You can download DeepSeek and learn to use it to its full potential through this course.

Because functionally speaking, all AI chatbots work the same way.

Let’s get back to our topic.

DeepSeek's biggest downside is said to be its censorship...

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