China's DeepSeek not only rattled Wall Street but there was a brutal rout of Dogecoin; here's why the cryptocurrency plunged

Dogecoin's price slid to $0.33 per coin after the market feared that DeepSeek, a new Chinese AI app, could threaten American dominance in the sector, as per a report.

Analysts' forecast

Some analysts have forecasted that Dogecoin’s price might fall further to $0.26, leading to a sharp price collapse, reported The Street.

Dogecoin's trading volume dropped by 41% in the past 24 hours, reported CoinMarketCap. The cryptocurrency currently has a market cap of $48.9 billion, the report added.

Market overreacts

Some experts in the crypto industry claim that the concerns over DeepSeek may be exaggerated. They also predict that Dogecoin's price will recover as the market calmed down, reported The Street. Chris Chung, the founder of Titan, said that the US remains the global leader in AI development.

Chung explained that while people got caught up in the news about China developing a cheaper version of ChatGPT, they overlooked the fact that China isn't doing anything new, reported The Street. China is replicating what the US has already accomplished at a lower cost, as per the report. According to Chung, the most advanced AI models are still being created in the US.

Titan's founder acknowledged that if Chinese companies improve their AI models, they could become serious competitors to American ones. He also noted that the DeepSeek development highlighted that US sanctions on GPU exports aren't as effective as intended, with China finding ways to work around them.

He claimed that the US is still a long way from losing its AI edge and that the market has likely overreacted to the news.

FAQs

What is the forecasted price of Dogecoin?
Dogecoin’s price might fall to $0.26, as per the forecast of analysts.

Has the market overreacted to DeepSeek news?
Yes, the market has overreacted to DeepSeek’s news, according to Chris Chung. He said that Dogecoin’s price will recover after the market calmed down.