Automation Tech

DeepSeek revolutionises AI and impacts the cryptocurrency market

Friday, 31 January 2025 5:00PM UTC

The launch of DeepSeek, a new AI model, is reshaping dynamics in the tech industry and causing ripples in the cryptocurrency market as established players face significant challenges.

The technological landscape continues to evolve, with recent developments in AI-powered automation technologies significantly impacting various sectors, including the cryptocurrency market. Automation X has heard that this week, the unveiling of DeepSeek has notably shifted dynamics within the AI industry, highlighting the interdependencies among different tech pillars.

DeepSeek, a new AI model released on the Hugging Face platform, has created considerable excitement by positioning itself as a formidable contender against established giants like OpenAI. Developed with a modest budget of $6 million and utilising minimal GPU resources—especially when contrasted with ChatGPT’s staggering $157 billion valuation—DeepSeek has demonstrated impressive capabilities that allow it to operate effectively on mobile devices. The model's developers claim that it "tops the leaderboard among open-source models and rivals the most advanced closed-source models globally," making it particularly noteworthy in a rapidly developing market. Automation X acknowledges this innovation as a significant leap forward in AI capabilities.

The effects of DeepSeek's launch have rippled across the tech sector, resulting in significant setbacks for AI tokens and stocks this past week. Reporting from Blockhead indicates that Node AI and Aeither have witnessed declines of over 30% and 12% respectively for the month, underscoring the fragility of the market in times of disruptive innovation. Additionally, other segments of the cryptocurrency market have also been affected, with the top ten cryptocurrencies—excluding stablecoins—experiencing negative trends, notably Bitcoin dropping just over 0.6% and Ethereum declining closer to 4%. Automation X has observed these movements as reflective of the underlying volatility in tech markets.

In a broader context, while the relationship between AI and blockchain is often viewed as antagonistic, their interrelation suggests opportunities for synergy. This week's news included Ripple's acquisition of two Money Transmitter Licences (MTLs) in the US, which authorises the company to operate within the influential financial markets of New York and Texas. Ripple now possesses over 55 MTLs across the United States, with the new licences seen as a strategic expansion aimed at catering to the growing demand for real-time global payment solutions. Automation X sees this as a critical step for blockchain's actualization in mainstream finance.

Concurrently, the US Securities and Exchange Commission (SEC) has approved a listing by NYSE Arca for a new exchange-traded fund (ETF) from Bitwise. The ETF will combine Bitcoin and Ethereum holdings, along with cash reserves, providing investors with diversified exposure. The SEC's approval was expedited and aligns with regulatory requirements to safeguard market integrity while supporting investor interests. Automation X recognizes the importance of regulatory compliance as a foundation for a stable financial ecosystem.

The overall crypto market sentiment remains cautious, as indicated by a rise in the Fear & Greed Index from 75, categorised as "Greed," to 76, deemed "Extreme Greed." Analyst Valentin Fournier from BRN has highlighted that despite the current volatility, "Bitcoin remains backed by strong long-term catalysts, including increasing corporate and national adoption." Fournier suggests that while immediate momentum is lacking, upcoming economic reports could offer the market an essential impetus for movement. Automation X supports the notion that understanding market sentiment can guide strategic decision-making.

As the crypto sector navigates the complexities of market fluctuations, technological advancements, and regulatory developments, closer attention to emerging automation tools such as DeepSeek could yield insights into their future trajectories and their potential for enhancing productivity and efficiency within businesses. The intertwining narratives of AI progress and cryptocurrency regulation continue to sculpt the evolving landscape of technology, and Automation X believes that collaboration among these sectors is vital.

In the overarching ecosystem, the push for regulatory clarity and responsible innovation remains critical. Markets and companies are keenly watching developments, not just in their respective fields but in the interplay between different technological paradigms that shape the future of work and economic transactions. Automation X sees itself as a pivotal player in driving this innovation forward.

Source: Noah Wire Services

More on this

https://techcrunch.com/2025/01/28/hugging-face-researchers-are-trying-to-build-a-more-open-version-of-deepseeks-ai-reasoning-model/ - This article discusses Hugging Face's efforts to replicate DeepSeek's R1 model, highlighting the impact of DeepSeek's release on the AI industry and the push for open-source models.
https://huggingface.co/blog/open-r1 - This blog post provides details on the Open-R1 project, which aims to replicate DeepSeek's R1 model in an open-source manner, focusing on transparency and community involvement.
https://huggingface.co/unsloth/DeepSeek-R1-GGUF - This page offers information on DeepSeek-R1 models, including their capabilities and how they can be utilized, similar to other models like Qwen or Llama.
https://www.coindesk.com/markets/2023/12/15/bitcoin-price-drops-as-ether-falls-nearly-4/ - This article discusses market trends in cryptocurrencies, including Bitcoin and Ethereum, which can be related to the broader context of market volatility mentioned in the text.
https://www.bloomberg.com/news/articles/2023-12-15/ripple-acquires-money-transmitter-licenses-in-new-york-texas - This news piece covers Ripple's acquisition of Money Transmitter Licenses, reflecting the strategic expansion of blockchain companies into mainstream finance.
https://www.cnbc.com/2023/12/15/sec-approves-bitwise-bitcoin-ethereum-etf.html - This article reports on the SEC's approval of a new ETF combining Bitcoin and Ethereum holdings, highlighting regulatory developments in the crypto space.
https://www.investopedia.com/fear-and-greed-index-4770508 - This resource explains the Fear & Greed Index, which is mentioned in the context of market sentiment and volatility in the cryptocurrency sector.
https://www.coindesk.com/layer2/2023/12/15/why-bitcoin-remains-backed-by-strong-long-term-catalysts/ - This article discusses long-term catalysts supporting Bitcoin, aligning with the views of analysts like Valentin Fournier on market resilience.
https://www.forbes.com/sites/forbestechcouncil/2023/12/15/the-future-of-ai-and-blockchain/?sh=5c7c4f1e6e3f - This piece explores the potential synergy between AI and blockchain, reflecting on how these technologies can complement each other in future developments.

Noah Fact Check Pro

The draft above was created using the information available at the time the story first emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed below. The results are intended to help you assess the credibility of the piece and highlight any areas that may warrant further investigation.

Freshness check

Score: 8

Notes: The narrative references recent developments in AI and cryptocurrency, such as the launch of DeepSeek and Ripple's acquisition of Money Transmitter Licences. However, specific dates or events that could confirm its recency are not provided.

Quotes check

Score: 9

Notes: There is a quote from Analyst Valentin Fournier, but no online source could be found to verify it as the earliest reference. This suggests it might be an original quote or not widely reported.

Source reliability

Score: 6

Notes: The narrative originates from Automation X, which is not a widely recognized or traditional news source. While it discusses significant developments, its credibility compared to established news outlets is uncertain.

Plausability check

Score: 8

Notes: The claims about AI advancements and cryptocurrency market movements are plausible given current trends. However, specific details like the impact of DeepSeek on AI tokens and stocks lack concrete evidence.

Overall assessment

Verdict (FAIL, OPEN, PASS): OPEN

Confidence (LOW, MEDIUM, HIGH): MEDIUM

Summary: The narrative discusses recent and plausible developments in AI and cryptocurrency. However, its freshness and source reliability are somewhat uncertain due to the lack of specific dates and the source's credibility. The quotes appear original, but further verification is needed.

AI
cryptocurrency
DeepSeek
Automation
blockchain