Why did DeepSeek's emergence directly impact the decline in the cryptocurrency market?
Changing market expectations for computing power demand:
• DeepSeek has achieved performance comparable to other top models with lower computing power requirements, which may change the market's perception of the importance of computing power in the fields of artificial intelligence and cryptocurrency. In the cryptocurrency field, mining is an important way to acquire new cryptocurrencies, and mining requires substantial computing power support. If the market believes that the future development of artificial intelligence technology can reduce dependence on computing power, then the costs and difficulties of cryptocurrency mining may decrease, which will affect the supply and value of cryptocurrencies.
• The cryptocurrency mining industry has always been an important source of computing power demand, but with the emergence of technologies like DeepSeek, the market may become concerned about the prospects of the cryptocurrency mining industry, thereby reducing investment in mining-related hardware and computing resources. This could limit the development of the cryptocurrency mining industry, further impacting the market landscape of cryptocurrencies.
Impacting the overall investment atmosphere and confidence in the market:
• The emergence of DeepSeek has triggered turmoil in the global tech stock market, with many tech companies' stock prices plummeting. This instability in the tech stock market can affect investor confidence in the overall market, including the cryptocurrency market. Investors may perceive significant risks in the current market environment, leading to reduced investments in cryptocurrencies.
• The cryptocurrency market itself lacks effective regulation and standards, resulting in poor market stability. In the context of global markets being impacted by new technological shocks and uncertain factors, the instability of the cryptocurrency market may further intensify, delivering a greater blow to investor confidence and leading to a decline in trading activity in the cryptocurrency market.
