Vice President JD Vance reaffirmed the U.S. commitment to safeguarding its artificial intelligence and semiconductor technologies, vowing to block efforts by authoritarian regimes to weaponize them.

Speaking at France’s AI Action Summit in Paris, Vance warned that some nations have exploited AI for military intelligence, surveillance, and foreign data manipulation. “This administration will block such efforts, full stop,” he stated. “We will safeguard American AI and chip technologies from theft and misuse, work with our allies and partners to strengthen and extend these protections, and close pathways to adversaries attaining AI capabilities that threaten all of our people.”

While he did not directly name China’s AI model DeepSeek, which has drawn global attention for its competitive performance at a lower cost, Vance criticized heavily subsidized technologies exported by authoritarian states. “We’re all familiar with cheap tech in the marketplace that’s been heavily subsidized and exported by authoritarian regimes,” he said.

In a pointed message to allies, Vance cautioned against collaborating with companies linked to such regimes, arguing it would compromise national security. “Chaining your nation to an authoritarian master that seeks to infiltrate, dig in, and seize your information infrastructure never pays off,” he added.

The U.S. has ramped up efforts to control AI development and chip manufacturing, tightening restrictions on exports to China and strengthening alliances in the tech sector.

Cryptocurrencies took a sharp hit after President Donald Trump imposed sweeping tariffs on Canada, Mexico, and China, triggering a global risk-off sentiment among investors.

Bitcoin dropped 2% on Monday to $95,722.77, after trading above $102,000 over the weekend, according to Coin Metrics. Meanwhile, the U.S. dollar index, which typically moves inversely to Bitcoin, climbed by nearly 1%.

The impact was even more severe on other digital assets. Ether (ETH) plunged 12% to around $2,600, down from $3,300 on Friday. The CoinDesk 20 index, a broader measure of the crypto market, sank 16% since Saturday, compared to Bitcoin’s 6% decline.

Shares of crypto-related companies were also affected, with Coinbase and MicroStrategy each losing about 5% in premarket trading.

Market Braces for More Volatility

The sell-off began Saturday evening, just hours after Trump signed an executive order slapping a 25% tariff on imports from Mexico and Canada and a 10% tariff on China. The U.S. conducts about $1.6 trillion in trade with these three countries, raising fears of a potential trade war.

According to James Davies, CEO of Crypto Valley Exchange, traders are unwinding leveraged positions as uncertainty looms. “Bulls are de-leveraging massively right now, watching closely to see if this escalates into a full-blown trade war.”

Bitcoin’s immediate support level is at $90,000, with analysts warning that a break below this level could trigger a steeper pullback to $80,000.

Could Tariffs Boost Bitcoin in the Long Run?

Despite the current market turmoil, some investors believe a prolonged tariff war could benefit Bitcoin in the long run. Jeff Park, Bitwise Asset Management’s head of alpha strategies, argues that an extended trade war could weaken the U.S. dollar and lead to lower interest rates, which might push Bitcoin higher over time.

“While Bitcoin is seen as a hedge against inflation and uncertainty in the long run, it still trades like a risk asset in the short term,” said Geoff Kendrick, an analyst at Standard Chartered. He warned that Bitcoin may experience further volatility this month, especially if economic concerns push investors away from risky assets.

With Bitcoin now about 12% off its all-time high of $109,350 set on Jan. 20, seasoned investors remain watchful. Crypto markets have historically endured corrections of 30% or more during bull markets, meaning that traders are bracing for further turbulence in the days ahead.

The emergence of Chinese AI app DeepSeek has triggered shockwaves across the US tech industry, leading to a significant drop in stock prices for major companies. AI chipmaker Nvidia saw its value plummet by 16%, losing $500 billion in market capitalization. Rival Broadcom also suffered a sharp decline, with shares falling 17.8%, while other tech giants like Microsoft and Meta experienced notable losses.

DeepSeek has quickly risen to become the most downloaded free app in the United States, overtaking popular rivals like ChatGPT. Its reported development cost of just $6 million has sent ripples through the industry, challenging the traditional notion that groundbreaking AI technology requires multibillion-dollar investments.

In stark contrast, companies like Microsoft and Meta have committed vast sums to AI development, with investments of $80 billion and $60–65 billion, respectively. DeepSeek’s meteoric rise suggests that a lower-cost, open-source approach may disrupt existing business models and redefine what is possible in AI.

The sudden market turmoil underscores concerns about America’s dominance in artificial intelligence. Investors are now questioning whether US tech companies can maintain their competitive edge against cheaper, innovative alternatives like DeepSeek.

Nvidia, a key player in AI chip manufacturing, experienced the most significant blow, as the app’s success has called into question the scalability and profitability of existing AI strategies reliant on expensive infrastructure.

DeepSeek’s rise highlights the potential for more cost-effective, innovative solutions in AI development. While its reported $6 million development budget remains disputed by some industry experts, it has already shifted perceptions of what achieving AI breakthroughs might cost.

This development could pave the way for smaller companies and governments to explore AI without the need for massive financial resources. In the UK, where the government is banking on AI to drive economic growth and reduce public service costs, such advancements could serve as inspiration for future projects.

Despite its success, DeepSeek’s rapid rise also raises questions about its long-term sustainability, data privacy, and the technology underpinning its platform. As researchers and analysts delve deeper into its model, the app’s low-cost development claims may face scrutiny.

The DeepSeek phenomenon has upended the AI market, challenging entrenched economic assumptions and sparking uncertainty for US tech giants.