Chinese AI startup DeepSeek released its open-source R1 reasoning model on January 20, 2025, shocking the tech world. The model matched or surpassed leading Western AI models — including GPT-4 — at a fraction of the cost (roughly $6 million vs. $100 million+ for GPT-4).
By January 27, the DeepSeek chatbot surpassed ChatGPT as the most-downloaded free app on the US iOS App Store. This caused an 18% drop in Nvidia's share price, wiping $593 billion from the company's market value in a single day.
DeepSeek R1 is shared as open source under the MIT license, making it accessible to researchers and developers worldwide.