Deepseek is planning to release a new chip of AI software, and is said to be fully developed and manufactured in China. This could have a cascade impact on Crypto and the US companies that will strengthen it.
Specifically, Trump’s trade war policy led China to seek the development of independent AI hardware solutions. Even if the chip is inferior to Nvidia’s, it could still separate US companies from the entire Chinese market.
Deepseek’s new AI chip
When Deepseek unveiled LLM in January, it had a transformative impact on both the AI and Crypto markets. Now that Openai founder Sam Altman declares a bubble in the market and Meta starts miniaturizing its AI division, we may be ripe for another turmoil.
For these reasons, the recent announcement that Deepseek is about to release a new next-generation AI chip has created real market uncertainty.
According to the company’s social media post, the new chip will be completely Chinese. Designed by Chinese companies and manufactured domestically without a large international supply chain.
Still, what does this have to do with cryptography? Unfortunately, these issues are very relevant. Deepseek’s AI software has disrupted US-based competitors like Openai.
These tangential connections still hurt crypto prices. However, in the hardware sector, CHIP maker Nvidia is very entangled in the crypto market.
At the moment, Nvidia’s two biggest use cases are for AI processing and crypto mining. So several companies are involved in both companies at the same time.
It’s just that Deepseek may have hampered the US AI market with Nvidia and mining stocks, but the chip exchange is even more disastrous.
Trump’s blowback from the trade war
Furthermore, Trump’s trade war with China definitely triggers this whole development process, with tariffs having a major negative impact on the code. According to a report released this week, Nvidia plans to withdraw from the Chinese market altogether.
The Trump administration has resumed trade only after temporarily banning Nvidia chips from exports to China and mandated a new security backdoor. In response, the Chinese government began officially stopping local tech companies from using NVIDIA products. This large chip market could soon be close to the US forever.
In other words, Trump’s policy encouraged Deepseek to invent and manufacture AI chips that could compete directly with Nvidia products.
If Deepseek succeeds, Nvidia could lose its major market and possibly hurt the crypto. Furthermore, anti-cryptic states may control industries that miners around the world rely on.
That means Deepseek’s new AI chip could have a very serious impact on crypto. Even if it’s a very inferior product, it can still drive nvidia out of China. However, if the chip endures hype, the two companies could compete for market domination around the world. Either way, it’s hard to see how bullish these scenarios are for crypto.
Deepseek’s new “Made in China” AI Chip post could potentially tank the Crypto market, which will first appear on Beincrypto.
