In This Story
Chinese artificial intelligence startup DeepSeek said it would temporarily limit signups after being the victim of “large-scale malicious attacks” on its servers.
Existing users can log in without problems, the company said on its website. Earlier on Monday, the company said it would restrict signups for new users to people with a mainland China phone number.
DeepSeek in December launched a free, open-source large language model, which it claimed it had developed in just two months for less than $6 million. Last week, the company launched a model that it said rivals OpenAI’s ChatGPT and Meta’s (META+1.62%) Llama 3.1 — and which rose to the top of Apple’s (AAPL-0.34%) App Store over the weekend. DeepSeek says it built the model using lower capability chips from Nvidia (NVDA-1.25%), which could put pressure on the major semiconductor maker.
The reported cyberattacks come as DeepSeek’s advanced technology sparked a widespread sell-off on Monday morning. Nvidia’s stock plunged more than 15%, wiping out $18 billion of founder and CEO Jensen Huang’s net worth.
Other major chip stocks also sank, including ASML (ASML+3.69%), Broadcom (AVGO+4.34%), Super Micro Computer (SMCI+2.21%), Micron (MU+3.54%), and Taiwan Semiconductor Manufacturing Co. (TSM+2.58%) The tech-heavy Nasdaq fell by more than 600 points.
The Dow Jones Industrial Average, an index of 30 of the largest U.S. companies including Nvidia, took a hit earlier on Monday but has since bounced back to a net 48-point gain. The S&P 500 is down almost 2%, or 107 points.
“[T]he Street will view DeepSeek as a major perceived threat to U.S. tech dominance and owning this AI Revolution,” Wedbush Securities analysts led by Dan Ives said in a note. “While the model is impressive and it will have a ripple impact,” they added, U.S. tech companies are focused on achieving artificial general intelligence, with a focus on “the infrastructure and ecosystem that China and especially DeepSeek cannot come close to in our view.”
—Rocio Fabbro and Vinamrata Chaturvedi contributed to this article