After a massive opening on the Wall Street market, Chinese startup DeepSeek on Monday said it was temporarily limiting registrations due to a large-scale malicious attack on its services, reported Reuters.
This comes hours after the AI assistant became the top-rated free application available on Apple’s App Store in the United States. The App also faced significant outages.
The company later resolved issues relating to its application programming interface and users’ inability to log in to the website, its status page showed.
DeepSeek’s R1 and its popularity
DeepSeek AI, a Chinese tech startup last week released its open-source AI model, DeepSeek-R1, which soon became the centre of attraction in the global market.
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 artificial intelligence application has surged in popularity among US users since it was released on January 10, according to app data research firm Sensor Tower.
An improved reasoning model called DeepSeek-R1 asserts that it outperforms current standards on several crucial tasks.
To accomplish these capabilities, the model and its variations, like DeepSeek-R1, use multi-stage training and large-scale reinforcement learning (RL) techniques.
DeepSeek, which was founded in 2023 by Liang Wenfeng, has said it’s produced a chatbot that competes with the latest technology from OpenAI and Meta Platforms Inc. at a fraction of the cost.
DeepSeek’s impact on Wall Street
DeepSeek on Monday led to a slump in technology shares across the world. Its free open-source AI model, DeepSeek-R1, shook investors’ faith in the AI sector’s demand for high-tech chips.
According to a Reuters report, the Nasdaq was 3.1 per cent down after the open, while the S&P 500 slid by 1.85%.
Leading chipmaker Nvidia saw its shares drop by 11 per cent in early trading. It led the losses among heavyweight tech stocks that had powered Wall Street’s main indexes to record levels. Microsoft shares tumbled 3.8%, Meta Platforms 3.1% and Alphabet 3.3%, the Reuters report added.
