Nvidia share price: US chip-maker set for biggest one-day loss, erases $500 billion of market cap

Nvidia share price on Monday crashed more than 15 percent in midday deals on Wall Street. The US-Chipmaker, whose semiconductors power the AI industry, erased more than $500 billion of its market value.

Nvidia is set to record its biggest one-day loss.

Nvidia led a rout in tech stocks Monday after the emergence of a low-cost Chinese generative AI model that could threaten US dominance in the fast-growing industry.


The chatbot developed by DeepSeek, a startup based in the eastern Chinese city of Hangzhou, has apparently shown the ability to match the capacity of US AI pace-setters for a fraction of the investments made by American companies.

DeepSeek, whose chatbot became the top-rated free application on Apple's US App Store, said it spent only $5.6 million developing its model -- peanuts when compared with the billions US tech giants have poured into AI.

US "tech dominance is being challenged by China," said Kathleen Brooks, research director at trading platform XTB.

"The focus is now on whether China can do it better, quicker and more cost effectively than the US, and if they could win the AI race," she said.

US venture capitalist Marc Andreessen has described DeepSeek's emergence as a "Sputnik moment" -- when the Soviet Union shocked Washington with its 1957 launch of a satellite into orbit.

As DeepSeek rattled markets, the startup on Monday said it was limiting the registration of new users due to "large-scale malicious attacks" on its services.