If you are a news guy, then you've probably heard of the drama that took place this week in the tech industry. If you didn't hear it, then let me do you the favor of a brief. As you know, currently the world's focus is on two main things: Cryptocurrency and Artificial Intelligence.
It's no surprise that these two areas had an effect in the 2024 American presidential election, where Donald Trump was declared the winner. I can somewhat say that it was primarily the crypto community, which is dominated by the youth, that ushered Mr. Trump to the White House. Although many things equally important played a role. Now I'm not an American and have never been there, so I may not know the entire details of what transpired. But based on the news I followed, this is my opinion.
This means that whoever can dominate these two sectors will have bigger control over the world and its future resources directly and indirectly. This is why I was excited to hear about America and its new policies by Mr. Trump to have a Bitcoin reserve. Other countries are already speeding to implement this. I'm more excited because I see a future where fiat currency might be worth it again since as countries adopt crypto, soon the fiat may be backed by it. But again, there is a problem because of the volatile nature of crypto. I don't know much about Bitcoin and its tokenomics but I hope as it gets widely adopted it can be a bit stable in a way (not completely though).
So What Happened This Week
This had to do with Artificial Intelligence. I must say that I didn't see any ripple effect on cryptocurrency particularly. If it did and I missed it, let me know in the comment section. I know people are trying to join these two sectors together, and I definitely see a future where they intertwine, but at the moment, they are two separate sectors.
Deepseek Hype
According to the news I read, DeepSeek is a Chinese AI startup that just dropped their R1 model (chips for training AI). Now they're claiming it rivals OpenAI's ChatGPT but was built with a fraction of OpenAI's budget. Training an AI for just $5.6 million according to them when OpenAI and the major AI companies are using somewhere over 60 million dollars.
That's less than 10% the cost.
This news is what drove investor sentiments through the roof and caused Nvidia, the company producing and selling the AI chips to the major AI companies, to lose over half a trillion dollars in the matter of hours. This is understandable in a way but also somewhat of an overreaction of the market. But hey, people will always make decisions out of fear and greed. I think now Nvidia seems to be bleeding less or maybe bouncing back because of some news coming out later that it may not be factual that they actually produced at that low cost.
I will dig deeper into it and let you know in later blogs what I find. But for now, I don't think people should be fearful of Deepseek, primarily due to the fact that it's open source. This means everyone can take advantage of it to scale up.
That's just my opinion on this matter.
Posted Using INLEO
I believe the raised funding for Westen AI companies is into billions of dollar, so $5.6m is insanely low and the crash of Nvidia is justified.
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