DeepSeek Shows China Playbook for Even Bigger US Shock on Chips

The success of DeepSeek’s new AI model points to how China might eventually achieve an even bigger technological breakthrough in the face of US export curbs: Producing its own cutting-edge chips.

As tech leaders and politicians marvel at DeepSeek’s apparent ability to build an innovative AI model without spending nearly as much as rivals in the US, a development that roiled markets on Monday, the question now is how exactly the Hangzhou-founded company pulled it off — and what it means for American efforts to stay ahead of China in the tech race.

The DeepSeek app

Photographer: Andrey Rudakov/Bloomberg

While much remains unclear, such as ...