An AI-powered chatbot developed by the Chinese company DeepSeek has rapidly become the most downloaded free app on Apple's App Store, following its launch in the US in January.
The app's sudden surge in popularity and the significantly lower costs associated with DeepSeek compared to US-based AI firms have unsettled financial markets.
Venture capitalist Marc Andreessen has lauded DeepSeek as "one of the most amazing and impressive breakthroughs" in the field of AI.
DeepSeek claims that its latest AI models are on par with leading US models like ChatGPT, but at a fraction of the cost.
The app was developed for only $6m (£4.8m), a stark contrast to the billions typically spent by US AI companies.
DeepSeek, a Chinese AI company, was founded in Hangzhou, a city in southeastern China, with partial funding from Liang Wenfeng, who used money from a hedge fund he launched.
Liang, a 40-year-old graduate in information and electronic engineering, reportedly stockpiled Nvidia A100 chips, now restricted from export to China, which inspired the creation of DeepSeek by combining them with less expensive, more readily available chips.
DeepSeek's AI app can be downloaded from the Apple App Store and its website, offering a free service that has quickly gained the top spot in downloads in the US, despite reported signup difficulties.
Users have praised the AI assistant for its similarity to ChatGPT and its ability to provide more personalized responses.
However, the chatbot avoided addressing a politically sensitive query about the events at Tiananmen Square in 1989, stating it was designed to offer only harmless responses.
The significantly lower development costs of DeepSeek compared to US competitors have sparked concerns about the future of American AI dominance, impacting financial markets and leading to a notable drop in Nvidia's market value.