DeepSeek, a Chinese AI application, has quickly become a sensation in the United States, attracting hordes of American users. Its introduction saw it become the most downloaded free application on Apple’s app store, causing shockwaves in Wall Street as investors scrambled to understand the sudden appearance of a low-cost, open-source generative AI tool that can compete with leading AI apps like OpenAI’s ChatGPT.
The stock of Nvidia, a U.S. manufacturer of advanced chips designed for AI development, plummeted 17%, resulting in roughly $600 billion being cut off from its market value— a record single-day drop for a U.S. stock. This surge in DeepSeek’s popularity has been described as a wake-up call by President Trump. In response, White House Press Secretary Karoline Leavitt announced that the National Security Council would study the potential national security implications around DeepSeek’s launch, with a goal to ensure American AI dominance.
Some lawmakers have also expressed concerns about the application’s access to U.S. users. House Select Committee on the Chinese Communist Party lead, Michigan Republican Rep. John Moolenaar, stated that stronger export controls on technologies critical to DeepSeek’s AI infrastructure are needed to protect national security.
The spotlight on DeepSeek comes amid rising tensions over trade, geopolitics, and other issues between the U.S. and China. The U.S. has implemented new export controls on China in an effort to control their semiconductor production used for advanced AI development.
Data security and privacy issues have also been raised for users of DeepSeek. The company notes in its privacy policy that personal information collected from users is stored “on secure servers located in the People’s Republic of China.” This includes users’ device model, operating system, keystroke patterns, IP address, and system language, which raises fears that personal data could be accessed by the Chinese Communist Party.
DeepSeek is different from TikTok, the Chinese-owned social media platform hit by a potential Congressional ban. TikTok has moved all of its U.S. data to American software maker Oracle to mitigate U.S. regulatory concerns—a move DeepSeek has not made.
China fellow at the Carnegie Endowment for International Peace, Matt Sheehan, notes that unlike TikTok, DeepSeek is an open-source large language model, which poses less of a threat since other U.S. AI companies like Perplexity are using a version of DeepSeek that doesn’t have data privacy or security threats.
DeepSeek’s users outside China are also facing censorship. For example, a CBS News analysis found that DeepSeek did not return any results for a prompt seeking information about the 1989 Tiananmen Square protests and subsequent massacre in Beijing. This suppression of information on an app being downloaded by millions poses a challenge for policymakers in the U.S.
DeepSeek, based in the Chinese city of Hangzhou, collects personal information and “service-related, diagnostic, and performance information,” according to the company.
In summary, the rise of the Chinese DeepSeek app has sparked concerns over national security and data privacy for U.S. users, with lawmakers and President Trump’s administration taking notice. The application also presents a challenge to American AI dominance and has raised questions about the role of Chinese-owned apps in the U.S.
