Lifting Trump’s AI Chip Ban on China Could Significantly Benefit DeepSeek

In recent weeks, Chinese AI startup DeepSeek has been making waves in the tech world. This newcomer has already outperformed OpenAI’s o1 reasoning model in key areas like math, science, and coding, and it’s doing so with just a tiny fraction of the budget that ChatGPT’s creator spent—3% of the cost, to be exact. To give you a clearer picture, DeepSeek managed to train its AI using their R1 V3 model with just $6 million through reinforcement learning.

These impressive feats have drawn plenty of attention, leading DeepSeek to become the most downloaded free AI app in the U.S. on Apple’s App Store, dethroning ChatGPT. However, Helen Toner, who used to serve on OpenAI’s board, believes that DeepSeek’s journey is just beginning and it could potentially take over the AI space—if the U.S. lifts the 2023 export restrictions on advanced chips to China, a regulation set by Biden’s administration.

Toner speculated that if these restrictions were removed, it would be a significant win for both China and DeepSeek. Speaking to Fortune, she suggested that Nvidia might try to convince President Trump that these export controls are hampering U.S. industry and should be revoked.

The buzz around DeepSeek doesn’t stop there; it’s also involved in allegations of using Microsoft and OpenAI’s data without permission, which potentially crosses into copyright infringement territory.

It’s noteworthy that Microsoft and OpenAI are already tangled in multiple lawsuits related to copyright infringements. OpenAI’s CEO, Sam Altman, pointed out that copyright law doesn’t outright ban using copyrighted materials for training AI models, adding that creating systems like ChatGPT would be impossible without access to such data.

Toner expressed uncertainty about whether Trump would maintain or reverse the export rules introduced by Biden. “The big question is whether or not the Trump administration will pick up where the last administration left off,” she stated.

During the final stretch of his presidency, Biden rolled out measures to tighten these export restrictions on China, making sure they couldn’t use alternatives like Huawei through shell companies to sidestep the rules. What Trump will do in response to the rapid AI innovations remains to be seen. “But they could decide to step in and weaken it,” Toner noted.

As for DeepSeek, exactly how they developed their R1 remains secretive. It’ll be fascinating to see how they stack up against leading AI models, especially with OpenAI’s massive $500 billion investment in Stargate, an initiative aimed at building data centers across the U.S. for AI advancements.

“So far, DeepSeek is acting as a fast follower, not leading the pack,” Toner remarked. “China is doing everything they can to keep up with the U.S. in AI, and they’re doing well at fast-following. But to imply they’re out ahead of us is clearly wrong.”