Mar 3, 2025
It’s no surprise that the artificial intelligence landscape is evolving rapidly, but a new contender, DeepSeek, has emerged as a significant disruptor. Developed in China by the hedge fund High-Flyer, DeepSeek has gained global attention for its impressive reasoning capabilities and affordability compared to American AI models. While it has been heralded as an innovative force, DeepSeek also raises serious cybersecurity concerns due to its data handling practices, its ties to the Chinese Communist Party (CCP), and its vulnerabilities to misuse.
One of the biggest concerns surrounding DeepSeek is data privacy. The AI program stores user data in China, making it subject to Chinese national security laws that require all companies to share data with the government upon request. This has led to growing fears that international users’ information could be accessed or monitored without their consent. In addition, DeepSeek has been found to be particularly susceptible to algorithmic jailbreaking, meaning that malicious actors could exploit it for harmful purposes like generating misinformation, bypassing ethical safeguards, or even aiding cyberattacks.
In this article, the cybersecurity experts at Blade Technologies explore what DeepSeek is, the security risks it presents, and its impact on the competitive AI landscape, particularly in relation to American AI giants.
What is DeepSeek?
DeepSeek is an advanced AI model developed by the Chinese hedge fund High-Flyer. The company, founded in May 2023 in Hangzhou, China, released DeepSeek-R1, its flagship reasoning AI model, in January 2025. The model quickly gained traction due to its high-level problem-solving capabilities and low-cost development, making it an attractive alternative to existing large-scale AI systems.
While DeepSeek has been marketed as an open-source large language model (LLM), it's tied to the Chinese Communist Party (CCP) and China’s strict data policies have raised concerns about its long-term implications. Unlike Western AI models, which are often developed by private organizations with public transparency, DeepSeek operates under Chinese jurisdiction, where data access is legally mandated for government review.
DeepSeek has already made waves in the AI industry. Shortly after its release, the model surpassed OpenAI’s ChatGPT as the most downloaded free app on the U.S. iOS App Store. This level of adoption has been unprecedented for a Chinese-developed AI tool in the Western market, signaling that American users are actively exploring alternatives to dominant AI platforms.
However, this rapid growth has also had economic implications. The surge in DeepSeek’s adoption has led to declines in stock valuations of major U.S. tech firms. Nvidia, one of the top companies in the U.S., saw its stock price plummet 17% a week after the release of DeepSeek. The introduction of a low-cost, high-performance AI model from China could shift the balance of power in the global AI race, forcing U.S. firms to reconsider their pricing and innovation strategies.
Security Risks Associated with DeepSeek AI
While DeepSeek presents exciting opportunities in terms of accessibility and affordability, it also brings new security challenges and raises questions about the future of AI development under different geopolitical frameworks. From data privacy issues to potential misuse by malicious actors, DeepSeek’s vulnerabilities have made it a controversial addition to the AI landscape.
As DeepSeek continues to grow, it becomes increasingly important for businesses, governments, and individual users to assess the risks before integrating it into their workflows. U.S. companies should evaluate AI partnerships carefully to ensure data security, and users should be aware of privacy risks and avoid sharing sensitive data with unverified AI platforms.
Data Privacy Concerns
One of the most alarming risks associated with DeepSeek is how it handles user data. Unlike AI models developed in the U.S. and Europe, which adhere to strict data privacy regulations like GDPR and CCPA, DeepSeek operates under China’s National Intelligence Law. This law mandates that Chinese companies must share data with the government upon request, a stark contrast to the user protections in Western nations.
Any user data processed by DeepSeek falls under Chinese jurisdiction, meaning the government could potentially access private interactions and stored information. Unlike OpenAI and Google DeepMind, which publish regular reports on data security and ethical considerations, DeepSeek provides little public insight into its data protection measures. Experts warn that DeepSeek could also be used as a tool for state-sponsored data collection, raising concerns about privacy for international users who interact with the model.
Vulnerabilities to Exploitation
DeepSeek’s open-source nature has both benefits and risks. While it allows for wider accessibility and innovation, it also means that cybercriminals and malicious actors can exploit its weaknesses more easily. DeepSeek has been found to be highly susceptible to jailbreaking, meaning attackers can bypass ethical guardrails and prompt the AI to generate harmful content. This could lead to misinformation campaigns, the creation of malware or phishing schemes, and the generation of harmful or illegal content.
Unlike Western AI models that incorporate reinforced safety measures, DeepSeek has been criticized for having fewer safeguards in place, making it easier for users to manipulate. Because AI-driven cybercrime is an increasing concern, the lack of regulatory oversight from independent agencies allows DeepSeek to operate as a powerful tool in the hands of cybercriminals.
Censorship and Information Control
DeepSeek’s development in China also means that its responses are subject to government-imposed restrictions. Unlike U.S.-based AI models that prioritize open information exchange, DeepSeek must comply with China’s strict censorship policies, which affects its ability to deliver neutral and unbiased responses.
DeepSeek has built-in censorship that prevents it from discussing topics deemed politically sensitive by the CCP, including human rights issues, the Tiananmen Square Massacre, the Hong Kong protests, and Taiwan independence. While Western AI models undergo rigorous training to mitigate bias, DeepSeek’s training is aligned with CCP guidelines, meaning it could be used to spread government-approved narratives rather than objective information. Some experts speculate that DeepSeek, or similar Chinese AI models, could be used for large-scale influence campaigns, targeting Western elections, public sentiment, and corporate decision-making.
DeepSeek’s Association with the Chinese Communist Party (CCP)
DeepSeek’s rapid emergence in the AI industry is not just a technological milestone—it also carries significant geopolitical implications. DeepSeek operates under China’s strict regulatory and political framework, which raises concerns about state control, surveillance, and influence.
Even if DeepSeek is not explicitly state-owned, its development and deployment are subject to the interests and policies of the CCP. This means the Chinese government could shape, monitor, or manipulate the technology for its own objectives. Additionally, unlike OpenAI, Google DeepMind, or Anthropic, which undergo regular third-party audits and reviews, DeepSeek operates without external checks on its security and ethical safeguards. Given the CCP’s ambitious AI development initiatives, some cybersecurity experts speculate that DeepSeek is part of China’s broader strategy to challenge U.S. dominance in AI and expand its influence in global tech markets.
The CCP’s potential control over DeepSeek also raises major concerns about how the model could be used beyond China’s borders. If international users adopt DeepSeek for business, research, or personal use, they may unknowingly be exposing themselves to risks, including mass data collection, AI censorship, and national security threats. Countries like the U.S. have already expressed concerns about Chinese technology, banning platforms like Huawei and TikTok from government networks due to their potential for espionage and surveillance. DeepSeek presents similar risks, especially if it’s used in corporate environments where sensitive data is processed.
China’s AI ambitions are no secret. The CCP has openly stated its goal of becoming the world leader in artificial intelligence by 2030, and DeepSeek is a significant step in that direction. The AI competition is no longer just about technological advancements—it’s about who controls the flow of information, sets AI regulations, and defines ethical AI use on a global scale.
For businesses, cybersecurity professionals, and policymakers, DeepSeek represents more than just an AI model—it’s a potential tool of influence, surveillance, and cyber risk. As China continues to push forward with AI advancements, the global community must be aware of the security, ethical, and geopolitical risks associated with adopting and integrating foreign AI technologies.
DeepSeek’s Competition with American AI Companies
DeepSeek has introduced a new level of competition for U.S.-based AI companies like OpenAI, Google DeepMind, and Anthropic. With its cost-efficient development, open-source accessibility, and rapid adoption, DeepSeek has disrupted the AI market in ways that could force American tech firms to rethink their strategies. However, the serious security concerns may also limit its global reach, creating a complex competitive dynamic between Chinese and Western AI developers.
Here’s how DeepSeek stacks up against its American competitors:
DeepSeek is an impressive AI model on paper, but its lack of security controls and Chinese government oversight make it a risky choice for businesses that handle sensitive or proprietary data. While American AI companies remain dominant, they must now reassess their strategies to compete in a world where Chinese AI models can gain traction quickly.
AI is Continuing to Evolve: Protect Your Business with Blade Technologies
DeepSeek’s rapid rise in the AI landscape has disrupted the industry in multiple ways. With its low-cost development, open-source availability, and powerful reasoning capabilities, it has positioned itself as a serious competitor to American AI giants like OpenAI, DeepMind, and Anthropic. However, beneath its technological advancements lie critical security risks businesses, governments, and individual users must carefully evaluate.
DeepSeek is a wake-up call for the global AI industry—a sign that the AI race is not just about building better models, but also about ensuring they remain safe, ethical, and accountable. The future of AI will be shaped not just by technological breakthroughs, but by how we navigate its risks in an increasingly interconnected world.
Before using any AI tool, especially one with foreign ties, businesses should assess its data privacy policies, security measures, and compliance with local regulations. Having a partner like Blade Technologies makes this process easier and more efficient, ensuring that your business is aware of all the risks of using any new technology before it leads to catastrophic damage. With comprehensive cybersecurity solutions, we help businesses monitor their networks, build strong safeguards, and implement technology that enhances business operations without unnecessary risks.
To protect your business and prepare for the future of AI, contact a Blade Technologies expert today.
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