Predicting the Future of AI with DeepSeek Signals

DeepSeek’s introduction of its R1 model in late January 2025 led to a significant decrease in market valuations throughout the AI industry, affecting model developers and infrastructure providers alike. The launch of R1, a powerful and affordable competitor to established U.S. AI models, was perceived by investors as a threat to the exaggerated growth projections that had supported inflated valuations. However, for those who had been observing closely, the emergence of DeepSeek — or something similar — was bound to happen sooner or later.