US bans DeepSeek AI from government use as tech tension with China continues

The United States government has officially prohibited the use of DeepSeek artificial intelligence technology within most civilian agencies. The Department of Homeland Security (DHS) issued a ban on July 31st, prohibiting all applications of DeepSeek, including any that utilized its AI models. DeepSeek, an open-source AI model that is both cost-effective and highly customizable, has emerged as a formidable competitor in the global AI landscape.

Despite the DHS issuing no explicit security reasons for the ban, the White House has previously criticized Chinese AI firms. The DHS, DeepSeek, and the Chinese embassy in Washington DC have all been approached for further comments. The ban, however, does not apply to agencies within the Department of Defense. The prohibition is specifically enacted for civilian agencies, encompassing the Department of the Treasury, the Department of State, and the Department of Justice.

Nonetheless, agencies within the Department of Defense are exempt. This ban is a direct response to earlier criticisms from the Trump administration and American firms about potential malicious exploitation of American AI technology by Chinese entities. Companies like Anthropic and OpenAI have accused Chinese firms, including DeepSeek, of copying their AI models.

US President Donald Trump has emphasized China as a significant competitor for AI development, crucial to the nation's future. Since its initial public release in 2025, DeepSeek's popularity has soared, leading to server overloads. Despite its popularity, the company's chatbot app is among the most downloaded apps in the Apple App Store.

Furthermore, DeepSeek's AI models are also utilized by US tech companies such as Snowflake, Vercel, and OpenRouter. Open-source models like DeepSeek have attracted numerous startups due to their low cost compared to closed models from tech giants. In 2025, DeepSeek reported that the initial training of its model cost approximately $6 million, whereas developing OpenAI's GPT-4 reportedly cost around $100 million.

This has led to a significant decrease in tech stocks. The most recent version of DeepSeek was recently released, and users have commented online that it outperforms even OpenAI's most advanced AI tools in tasks like computer software coding.