DeepSeek is Developing its own AI Chip!

DeepSeek, a Chinese startup, has been secretly hiring chip designers for months and building its own artificial intelligence chip for inference — the part of the AI model that processes end-user requests, according to Reuters.

Three sources familiar with the matter told the news agency that the Chinese firm has started discussions with chip designers, chipmakers, and memory makers. At this point, the project is in the preliminary stages, but DeepSeek is looking to diversify away from reliance on Nvidia and Huawei, the latter of which is also restricted by US export rules from accessing advanced AI chips.

DeepSeek is simultaneously raising capital in what would be an unprecedented move in the company’s history. Reuters reports that the firm is currently negotiating a $7B funding round at a valuation between $52B-$59B. If successful, it would make DeepSeek the largest private AI research facility in the world.

OpenAI recently unveiled plans for a chip called Jalapeño in collaboration with Broadcom and Anthropic said it was working with Samsung to build its own AI chip. But it’s more difficult for DeepSeek because of US export controls that restrict access to advanced semiconductor technology that American companies can use with ease.