The new AI chip "Made in China" from DeepSeek could collapse the crypto market in the United States.

DeepSeek plans to issue a new AI chip entirely produced in China, which could have far-reaching impacts on the crypto market and related American companies.

Donald Trump's trade war policy has pushed China to develop independent AI hardware solutions. Even if DeepSeek's new chip does not meet the standards of Nvidia's products, it still has the potential to force American companies to withdraw from the crypto market.

New AI Chip from DeepSeek

When DeepSeek announced its large language model (LLM) in January, it created a major shock for both the AI and crypto market. Currently, with Sam Altman, the founder of OpenAI, declaring that the market is in a bubble and Meta starting to downsize its AI department, we may be facing a new disruption.

A recent announcement from DeepSeek regarding the upcoming issuance of a new generation AI chip has caused concern among investors. According to the company's social media posts, this chip will be entirely designed and manufactured domestically by Chinese companies without relying on large international supply chains.

Impact on the crypto market

So how is this related to the crypto market? A lot. DeepSeek's AI software has disrupted American competitors like OpenAI. These connections have been negatively impacting the price of cryptocurrencies. In the hardware sector, Nvidia has a closer association with the crypto market.

Currently, the two largest use cases for Nvidia are AI processing and crypto mining, which is why many companies are getting involved in both areas. The mere ability of DeepSeek to disrupt the AI market in America has caused the stocks of Nvidia and mining companies to plummet, but the chip replacement could be more severe.

Consequences of the trade war

Moreover, Trump's trade war with China is said to be the main reason for this development, and the tariffs have had a significant negative impact on the crypto market. According to a recent report, Nvidia is planning to completely withdraw from the China market.

The Trump administration has temporarily banned the export of Nvidia chips to China and will only reopen trade after requiring new security measures. In response, the Chinese government has officially encouraged local tech companies not to use Nvidia products, putting this massive chip market at risk of permanently closing off to America.

In other words, Trump's policies have encouraged DeepSeek to invent and produce AI chips that can directly compete with Nvidia's products. If DeepSeek succeeds, Nvidia will lose an important market, which could harm the crypto market. Furthermore, a country that is anti-crypto could dominate the industry that global miners depend on.

In summary, DeepSeek's new AI chip could have serious impacts on the crypto market. Even if this product is far inferior to Nvidia, it still has the potential to push this company out of America. However, if this chip truly meets expectations, the two companies may compete for dominance in the global market. Regardless, it is hard to see how these scenarios could bring positive signals for cryptocurrency.

Mr. Giáo