Silicon Valley and Washington leaders said the app shows China can challenge the U.S. The Nasdaq lost 3 percent and chipmaker Nvidia shed $589 billion in market capitalization.

On Monday, as DeepSeek’s recently introduced innovations wiped over $1 trillion off the value of U.S. stocks, and just days after announcing a privately funded $500 billion AI infrastructure push, President Donald Trump said DeepSeek’s rise was “a wake-up call for our industries that we should be laser-focused on competing to win.”

The Chinese start-up DeepSeek’s latest large language model has been described as a ‘Sputnik moment’ for the American tech industry