🏮DeepSeek: everything you need to know right now.

The markets went crazy today. A bit too crazy.

My WhatsApp exploded over the weekend as we received an early Chinese New Year surprise from DeepSeek. The Chinese AI firm launched its reasoning model last week, and analysts belatedly woke up to it. The firm’s consumer app jumped to number 1 in the Apple AppStore and American stock markets, overly indexed on big tech, are taking a pounding. 

We’ve been tracking DeepSeek for a while. I first wrote about it all the way back in EV#451 in Dec 2023, with the question: “Is China the new open-source leader?”.

And last month when writing about DeepSeek V3, I wrote:

The gap between open source (like DeepSeek) and closed source (like OpenAI) is narrowing rapidly. It calls into question efforts to constrain open-source AI development… The elegance of the approach, more refined than brute force, ought to be a wake-up call for US labs following a 'muscle-car' strategy.

It was, I said back in December 2024, “the ‘Chinese Sputnik’ that demands our attention”.