DeepSeek AI Rally: Chinese Stocks Surge on Unconfirmed News

DeepSeek AI and Market Reactions

The Chinese artificial intelligence firm, DeepSeek, recently became a focal point in global financial markets. Its advancements contributed to a significant downturn in U.S. technology stocks on Monday, notably impacting Nvidia, which experienced a near 20% decline.

Speculation and Stock Surges in China

Within China, considerable excitement surrounding DeepSeek has led to substantial increases in the share prices of several publicly listed companies. These companies were alleged to have connections to the AI developer.

However, investigations reveal a lack of concrete evidence supporting these claims of investment or collaboration.

Disputed Investor Links

Huajin Capital and Zhejiang Orient both saw their stock values rise by 10% on Monday. Similarly, Sublime China Information, a research firm, experienced a 20% jump, attributed to purported cooperation with DeepSeek on its AI model development. (These represent the maximum permissible daily gains on Chinese stock exchanges.)

Sublime China Information has officially refuted any cooperative relationship with DeepSeek through a public disclosure. Huajin Capital also denied having publicly announced any investment in DeepSeek, as reported to a Chinese business news source.

Zhejiang Orient has not yet responded to inquiries from TechCrunch. No publicly available information confirms their status as investors in DeepSeek.

Origin of the Rumors

The source of these rumors appears to be unverified lists circulating online within China. These lists falsely identify various publicly traded companies as being linked to DeepSeek.

DeepSeek's Funding Structure

DeepSeek, operating as a private entity, has not made any public announcements regarding venture capital investments. Chinese corporate records do not list any VC firms within DeepSeek’s ownership structure.

Instead, the company’s founder, Liang Wenfeng, is documented as the ultimate beneficial owner of the three entities that comprise DeepSeek.

Funding for DeepSeek comes primarily from the quantitative trading firm, High-Flyer, where Wenfeng also serves as CEO. Wenfeng indicated last year to the Chinese media outlet Waves that DeepSeek has no immediate plans to seek additional funding.

VC Hesitation

In a 2023 interview with Waves, Wenfeng explained that while he engaged in discussions with potential funding sources, venture capitalists demonstrated a reluctance to invest in a company primarily focused on research. Their preference leaned towards ventures with clear commercial applications.

DeepSeek did not provide a response to a request for comment from TechCrunch.