Donald Trump has begun his second term as US President with a strong focus on cryptocurrency and artificial intelligence, appointing former PayPal executive David Sacks as a “White House AI and crypto czar” and launching his own memecoin. Photo / Bloomberg via Getty Images
Silicon Valley’s been rattled by a low-cost Chinese AI – with the start-up claiming its DeepSeek technology can emulate the performance of ChatGPT, at a fraction of the cost.
Its launch shook share markets and spawned allegations from OpenAI that their Chinese rivals used its work and models to make their artificial intelligence.
This is all happening while the new US administration appoints an “AI and crypto czar” so the online currency can “thrive”.
BusinessDesk technology columnist Peter Griffin told The Front Page when OpenAI released ChatGPT in November 2022 it was a game changer.
The tech is now used for Microsoft’s Copilot service, Meta has an open-source AI called Llama, Amazon has pumped US $8 billion ($14.13b) into its own Anthropic, and France has seen start-up Mistral soar in popularity.
“Then you’ve got all these Chinese companies, which we don’t know very much about. DeepSeek is the one that has popped on to the radar just in the last couple of weeks. But, there is a whole ecosystem of companies in China working on this as well,” Griffin said.
DeepSeek’s researchers claim that they were able to train their AI in just two months for around US$6 million – a fraction of the cost of OpenAI. Estimates have the big US cloud companies spending about US$250b this year on AI infrastructure.
“What we’ve heard about DeepSeek is very significant. And we’ve seen that reflected in the hit that the share market has taken. A lot of the tech companies, particularly Nvidia, have lost some value.
“What there is a question mark over is the exact circumstances they used to build and train that model.
“They claim they did it for as little as $6m. [There are] accusations that they have distilled all of the data from other models. Open AI is investigating at the moment the potential that DeepSeek actually took all of the data out of Open AI and used it to train its model.
“There’s not a lot of transparency often around Chinese companies and how they operate. And you’ve got the looming presence of the Chinese Communist Party in the background. There are geopolitical issues here. There are competitive tensions.
“So a lot of this has still to wash out, but it looks as though, according to the experts, that this is a more efficient way of doing AI. And that fundamentally changes everything. And I think in a good way as well, because AI has been too expensive, too energy intensive. We need breakthroughs to make it more accessible to more people,” Griffin said.
It’s the world’s worst-kept secret that US President Donald Trump has been championing crypto.
Recently, Trump Media announced plans to invest up to US$250m into “investment accounts and Bitcoin and similar cryptocurrencies or crypto-related securities”.
And he’s already faced criticism for launching a multibillion-dollar crypto meme coin on the eve of his inauguration – something Griffin said is a huge conflict of interest.
“You could have supporters of Donald Trump who jump on board that bandwagon and then end up losing a lot of money. He looks to profit significantly if the value of these coins goes up, which they have,” he said.
Trump has kicked off his term by appointing former PayPal executive David Sacks as the “White House AI and crypto czar”.
“In terms of his philosophy and approach to crypto, it’s very much influenced by the PayPal mafia that now surrounds him. People like Elon Musk, David Sacks, and Peter Thiel.
“Because they’ve been influential, he is talking about low regulation of crypto, and even having a strategic reserve for the US buying Bitcoin or seizing Bitcoin that has been taken from criminals and building a strategic reserve out of that,” Griffin said.
Listen to the full episode to hear more about how interest in AI and crypto overseas could affect NZ operations.
The Front Page is a daily news podcast from the New Zealand Herald, available to listen to every weekday from 5am. The podcast is presented by Chelsea Daniels, an Auckland-based journalist with a background in world news and crime/justice reporting who joined NZME in 2016.
You can follow the podcast at iHeartRadio, Apple Podcasts, Spotify, or wherever you get your podcasts.
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