Chinese startup DeepSeek's R1 chatbot has gained attention for its low development cost and impressive performance, overtaking U.S. competitors in downloads. The launch coincided with ASML’s CEO stating that lower AI costs could increase chip demand, mitigating fears of spending slumps. However, concerns over intellectual property theft have emerged, with suggestions that DeepSeek may have used OpenAI’s technology through a technique called distillation. As a result, OpenAI and Microsoft are investigating these claims, with repercussions seen in market values and scrutiny from U.S. officials, including the Navy banning its use.