DeepSeek exposes the AI investment paradox: bubble or efficiency?

In early 2025, a Chinese startup revolutionized the artificial intelligence sector not only because of its product but also because of how it achieved it. DeepSeek, with a budget of just $10 million, launched a tool that directly competes with ChatGPT, which required over $17 billion in investments to develop. This contrast did not go unnoticed by global markets, triggering a chain reaction that touched everything from technology to cryptocurrencies.

A startup with minimal budget, maximum results

DeepSeek’s entry into the market highlighted an uncomfortable question for tech giants: do we really need such vast resources? While OpenAI was valued at $150 billion after raising massive capital, this Chinese startup demonstrated that efficiency in research and optimization could compensate for the lack of unlimited funding. Not only did it create a viable competitor, but it also challenged the narrative that spending more guarantees better results in developing advanced language models.

The domino effect in global markets

The reaction was immediate. NVIDIA, the company dominating the market for specialized AI chips, experienced significant declines in its valuation. The NASDAQ index also reflected this uncertainty, with widespread corrections in the tech sector. Investors began reevaluating whether it was truly justified to invest $100 billion annually in AI companies when a viable competitor emerged with a fraction of that capital. This shake-up in U.S. stock markets quickly spilled over into other sectors.

Cryptocurrencies: a mirror of technological volatility

The cryptocurrency market, historically correlated with the performance of tech stocks, was not immune to these movements. Bitcoin and altcoins declined in sync with the sector’s overall retreat. DeepSeek inadvertently became a catalyst that exposed vulnerabilities in market expectations regarding the future profitability of the AI sector.

What does this mean for investors?

The DeepSeek phenomenon raises fundamental questions: Were AI companies that consumed disproportionate resources overvalued? Has the tech investment bubble reached its limit? The truth is, DeepSeek not only changed the conversation about efficiency in technological development but also forced a rethinking of the relationship between invested capital and tangible results in the industry.