The Innovations of DeepSeek and the Inherent Dilemmas of the Blockchain Industry

In early 2025, the DeepSeek model developed by Huanshang Quantitative caused a huge sensation in the AI field. This Chinese AI model, which uses only 2048 Blocks of Nvidia H800 GPUs and has a training cost of 5.58 million USD, has performed on par with GPT-4o and Llama 3.1 in several benchmark tests, even slightly outperforming them in certain aspects. This groundbreaking achievement showcases the innovative technological path taken by China in the face of chip blockades and poses a challenge to the United States' leading position in the AI field.

The success of DeepSeek is not just a technological breakthrough, but has also sparked a strong global response. This time, China is no longer a follower of technology, but has emerged as an innovator, drawing significant attention from American politicians and tech giants.

The emergence of DeepSeek has brought several significant impacts to the cryptocurrency industry:

1. NVIDIA is impacted. DeepSeek bypasses the CUDA architecture and directly uses PTX, which not only improves training efficiency but also paves the way for future compatibility with domestic GPUs. This could be an opportunity for decentralized computing power projects, allowing more individual GPUs to participate in AI training.

2. AI framework projects in the cryptocurrency field face challenges. The rapid advancement of traditional AI companies makes AI projects in the cryptocurrency industry appear inadequate. The future integration of cryptocurrency and AI may require more attention to aspects such as privacy and security, such as providing a secure payment environment for AI Agents or leveraging Blockchain for the compliance auditing of AI models.

3. The development of AI may give rise to new incentive mechanisms. For example, teaching AI to interact with the virtual world through decentralized networks, or exploring directions such as AI automating the adjustment of token economic models.

4. The concept of inclusive finance may regain attention. As AI replaces more jobs, projects similar to Worldcoin may emerge in new forms.

5. Decentralized AI Research (DeAIS) may become a new direction, promoting AI research by raising resources through Blockchain.

However, the cryptocurrency market also faces some endogenous dilemmas:

1. The evolution of the Meme coin market. From cultural consensus to short-term speculation, the project lifecycle has shortened, and investment risks have intensified.

2. The traditional cycle law is no longer valid. A Bitcoin bull run no longer necessarily drives altcoins up; the market needs a new cognitive framework.

3. Token quantity inflation. It increased from 2,000 in 2017 to nearly 25,000 in 2024, but innovation and application did not grow in sync.

4. The valuation system needs to be reshaped. Most projects struggle to support their financing valuations, and the market may need to undergo a deep adjustment.

5. Direction lost. Apart from Bitcoin, it is difficult for other projects to gain long-term confidence, and there is a lack of innovation momentum in the industry.

Despite the current severe situation, the cryptocurrency industry still has advantages. A favorable policy environment, high attention, ample funding, and mature infrastructure provide good conditions for the industry's development. The future launch of altcoin ETFs may inject new vitality into the market. The industry needs to break through its own limitations in the current environment of high mainstream attention and explore truly innovative directions.