A Chinese startup named DeepSeek has taken the lead in the AI race, with its assistant app becoming the most popular free app on Apple's US App Store, surpassing ChatGPT, according to data firm Sensor Tower. The app, powered by the DeepSeek-V3 model, was launched on January 10 and has quickly gained attention in the United States.

DeepSeek claims its AI model competes with the best in the world, even though it was trained using less expensive Nvidia H800 chips, which are not the latest technology, according to a report by Reuters. The company says it spent less than $6 million on training, a figure that has surprised many in the tech industry. These details, while debated, have raised questions about whether US restrictions on exporting advanced chips to China are working.

Since 2021, the US government has imposed strict rules to prevent China from accessing high-end chips needed for AI development, states the report. However, DeepSeek's success suggests that competitive AI models can still be built with less powerful hardware, challenging assumptions about the effectiveness of these restrictions.

DeepSeek, a small startup from Hangzhou founded in 2023, is part of a growing group of Chinese companies developing AI. Unlike its competitors, DeepSeek is the first to earn significant recognition in the US tech industry for creating an AI model that matches, or even outperforms, leading US systems.