The sudden rise of Chinese AI app DeepSeek has leaders in Washington and Silicon Valley grappling with how to keep the U.S. ahead in the crucial technology.

The AI startup developed a top system by relying on inexperienced engineers and a loophole in U.S. export controls.

DeepSeek has delighted the Chinese internet ahead of Lunar New Year, the country's biggest holiday. It's good news for a beleaguered economy and a tech industry that is bracing for further tariffs and the possible sale of TikTok's US business.

DeepSeek’s latest models, created by a small company with limited resources, are already beating many of the leading AI models in the United States.

The company built a cheaper, competitive chatbot with fewer high-end computer chips than U.S. behemoths like Google and OpenAI, showing the limits of chip export control.