DeepSeek became China’s most valuable AI startup after raising $7.4 billion, but its $50 billion valuation is eclipsed by the astronomical market values of its US rivals.

The upstart upended Silicon Valley with its cost-effective open-source model last year, and is seen as leading Beijing’s race against the US.

While it marks one of China’s largest private tech fundraisings, US frontier labs Anthropic and OpenAI recently raised $65 billion and $122 billion respectively. The disparity is largely due to geopolitical constraints, Reuters reported, which confine DeepSeek’s fundraising to China and limit its access to American hardware, making it pointless to “match the multi-billion-dollar computing budgets” of US rivals, an analyst said.