NVDA: Nvidia Stock Loses $589 Billion in Biggest Value Drop in History. What’s DeepSeek?

AI bellwether got a huge chunk of its valuation stripped away after a Chinese rival said it has achieved more with less.

🏆 Nvidia Sheds $589 Billion

• Nvidia stock NVDA showed it can also make records in reverse. It washed out a whopping 17% of its valuation on Monday as investors ran for the hills after Chinese AI startup DeepSeek released an AI model that took on OpenAI’s ChatGPT. And it did so for a fraction of the cost without compromising on the quality of results.
• Jensen Huang’s Nvidia shed a shocking $589 billion in market value, the biggest single-day loss in history, while Huang himself waved goodbye to $20 billion of his net worth.

👉👈 $6 Mil Against $100 Mil

• Things went south even before the market opened with futures contracts sliding on the news that DeepSeek’s new AI model R1 was on par with the most advanced OpenAI chatbot, GPT-4. DeepSeek said it spent just about $6 million to train its technology, while OpenAI burned through more than $100 million.
• Once the realization hit, there was no way back — traders rushed to sell off their shares of companies with frothy valuations, resulting in the mayhem on Wall Street.

😘 DeepSeek Used Nvidia to Beat Nvidia

• Funnily enough, DeepSeek used 2,048 Nvidia H800 chips to train its R1 model and achieve its impressive results. Big tech companies, at the same time, have been paying for the most-advanced H100 chips that run for around $30,000 a piece.
• So what’s DeepSeek? The Chinese AI startup was created by a leading Chinese hedge fund founded by Lian Wenfeng who’s a skilled quant trader (and a tech luminary, obviously).