Chinese startup DeepSeek announced on Monday that it will temporarily restrict new registrations due to a cyberattack following a surge in popularity for its AI assistant. Earlier in the day, the company’s website experienced outages after its AI assistant became the top-rated free app on Apple’s App Store in the United States.
According to DeepSeek’s status page, the company resolved issues related to its application programming interface and users’ inability to log in. The outages on Monday marked the company’s longest in around 90 days and coincided with its skyrocketing popularity.
Last week, DeepSeek launched a free AI assistant that it claims uses significantly less data at a fraction of the cost of existing models, potentially signaling a shift in the level of investment required for AI. The assistant is powered by the DeepSeek-V3 model, which its creators say “tops the leaderboard among open-source models and rivals the most advanced closed-source models globally.”
The app’s popularity has surged among U.S. users since its release on January 10, according to data from app research firm Sensor Tower. The milestone underscores how DeepSeek has made a strong impression in Silicon Valley, challenging long-held assumptions about U.S. dominance in AI and raising questions about the effectiveness of Washington’s export controls aimed at curbing China’s AI and advanced chip capabilities.
On Monday, technology stocks took a hit, with shares of Nvidia (NVDA.O) and Oracle (ORCL.N) plummeting. AI models, including ChatGPT and DeepSeek, require advanced chips for training. Since 2021, the Biden administration has expanded bans to prevent these chips from being exported to China for use in AI development.
However, DeepSeek researchers claimed in a paper last month that the DeepSeek-V3 model was trained using Nvidia’s H800 chips, spending less than $6 million. Although this detail has been contested, the assertion that these chips are less powerful than the top-tier Nvidia products restricted by U.S. export controls has led U.S. tech executives to question the effectiveness of these measures.
DeepSeek, a small Hangzhou-based startup founded in 2023, emerged in the same year that Baidu launched China’s first AI large-language model. While dozens of Chinese tech companies have since introduced their own AI models, DeepSeek is the first to gain recognition from the U.S. tech industry for matching—or even exceeding—the performance of cutting-edge U.S. models.