By dailynewspapers.in
OpenAI, the U.S.-based artificial intelligence company, has claimed it found evidence that Chinese AI firm DeepSeek used its proprietary models to train its own systems—a practice known as “knowledge distillation”—but has yet to publicly disclose proof.
According to a report by *Cailian Press*, OpenAI told media outlets it identified signs of “distillation,” a technique where knowledge from larger, more powerful models is transferred to smaller, cheaper models while retaining high performance. The accusation follows DeepSeek’s recent launch of its **DeepSeek-R1** model, developed by Chinese quantitative trading giant *Huanfang Quant*. The model reportedly matches OpenAI’s top-tier reasoning model, **o1**, in critical areas like mathematics, programming, and logic—at **1/30th the training cost** of OpenAI’s latest system.
The announcement triggered a selloff in U.S. tech stocks this week:
– **NASDAQ** fell over 3% on Monday.
– **NVIDIA**, a key AI chip supplier, plunged nearly **17%**, wiping out billions in market value.
While knowledge distillation is common in AI development, OpenAI’s terms of service explicitly ban using its outputs to “create competing models.” The company has not elaborated on its claims or shared evidence. However, a source familiar with the matter revealed that OpenAI and its partner **Microsoft** investigated accounts that accessed OpenAI’s API last year and blocked some over alleged violations.
Political Reactions
– David Sacks, the Trump-appointed White House AI and Crypto Lead, stated: *”There’s substantial evidence DeepSeek extracted knowledge from OpenAI’s models, and OpenAI isn’t happy about it.”
– U.S. officials labeled DeepSeek’s actions “theft” and announced a national security review of its impact.
– Former President Donald Trump, however, praised DeepSeek on Monday as a “positive technological achievement,” contradicting his allies’ criticisms.
Why It Matters
DeepSeek’s breakthrough challenges the assumption that cutting-edge AI requires massive budgets dominated by U.S. firms. If proven, the allegations could escalate tensions in the U.S.-China tech rivalry and reshape global
Source: dailynewspapers.in*