Australian cybersecurity leaders and the federal opposition have raised alarms regarding the Chinese artificial intelligence start-up DeepSeek, which has rapidly ascended to the top of global app stores and disrupted share markets, posing a challenge to America’s AI supremacy. DeepSeek’s swift rise this week caught investors and analysts off guard, as well as seemingly the company itself, which announced it would temporarily restrict user registrations due to frequent outages caused by its unexpected popularity.
This surge has also led to significant declines on Wall Street, impacting shares of major American AI firms like Nvidia, which experienced its largest drop in US stock market history, along with Oracle, Meta, and Alphabet, Google’s parent company.
Little information is available about DeepSeek, a small start-up based in Hangzhou, founded in 2023 by entrepreneur Liang Wenfeng, who also manages a hedge fund, High-Flyer Capital, that utilizes AI to analyze stock price patterns. Last week, DeepSeek introduced its free AI chatbot, claiming it outperforms ChatGPT in technical capabilities while consuming less energy and incurring lower costs. The app is now leading global app store rankings.
However, Australian cybersecurity officials and the federal opposition are concerned that the company is censoring content and transmitting sensitive data to Chinese servers, reminiscent of previous worries regarding TikTok and Huawei. Liberal senator James Paterson has previously advocated for a ban on TikTok and cautioned Australians about using Chinese-owned applications like DeepSeek.
“It is evident from the app’s terms and conditions that extensive user data is collected, including input prompts,” he stated. “The app’s policies also indicate that they will provide this information if requested by the Chinese government. I am particularly worried about the apparent bias in the AI algorithm, which seems to align with a Chinese Communist Party perspective, as it has been known to withhold information on topics sensitive to the CCP and its historical treatment of minorities and democratic activists. We must ensure this does not become another instrument of authoritarian propaganda, and I hope the Albanese government is coordinating a response with our closest allies.”
Industry and Science Minister Ed Husic refrained from labeling DeepSeek a national concern when questioned multiple times at a press conference, stating that the government would “keep an open mind” and monitor any potential risks to national interests. “I think it’s too early to jump to conclusions,” he remarked. “We will clearly be guided by the advice of the National Intelligence Community regarding any threats that may arise.”
