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Just days after Fortune Magazine announced “Why DeepSeek is excellent news for the U.S. stock market”, Texas Republican Gov. Greg Abbott issued a ban on Chinese artificial intelligence company DeepSeek for government-issued devices, becoming the first state to restrict the popular chatbot in such a manner. The upstart AI platform has sent shockwaves throughout the AI community after gaining popularity amongst American users in recent weeks.
Fortune reported that: “China’s DeepSeek surprised the technology world this week by releasing an AI model that almost matched the performance of American rivals while requiring far less computing power. The news sparked a sell-off in U.S. stocks as investors fretted that the need for powerful computers to train and operate AI models may be overblown.
“In fact, this is a shortsighted view that misses the significant benefits that DeepSeek represents for the U.S. economy and for businesses worldwide.”
Aside from banning DeepSeek AP reoprts, Texas Gov. Abbott, equally prohibited popular Chinese-owned social media apps Xiaohongshu, or what some are calling RedNote, and Lemon8 from all state-issued devices.
“Texas will not allow the Chinese Communist Party to infiltrate our state’s critical infrastructure through data-harvesting AI and social media apps,” Abbott said in a statement. “Texas will continue to protect and defend our state from hostile foreign actors.”
The governor’s office declined to comment further for this story.
AI startup DeepSeek has rocked markets upon demonstrating its capacity to compete with industry leader OpenAI.
U.S. also users flocked to Xiaohongshu in the days leading up to TikTok’s short-lived ban. It’s a popular app in China and surrounding countries — such as Malaysia and Taiwan — with roughly 300 million active users that many Americans were using as a replacement doe TikTok, and as a form of protest against the ban.
Lemon8 is also a Chinese company owned by ByteDance, the parent company of TikTok. The social media app also gained traction in the days leading up to the original TikTok ban on Jan. 19.
Texas, along with many other states and the federal government, has banned TikTok on government devices. The app’s future remains in limbo after President Trump issued an executive order to give ByteDance more time to divest TikTok’s U.S. operations.
ByteDance did not immediately return an email seeking comment.
Watch the video of man who predicted ban of DeepSeek in the US.
