Key Points
1 : Alibaba asserts its Qwen 2.5 AI model outperforms DeepSeek-V3.
2 : Concerns rise over a potential crypto market crash as US AI dominance faces challenges.
3 : DeepSeek’s emergence had already shaken global stock and crypto markets earlier this week.
Alibaba’s Qwen AI: A Game-Changer or Market Disruptor?
Chinese tech giant Alibaba has announced that its Qwen 2.5 AI model surpasses DeepSeek-V3 in every aspect. The revelation, made on the first day of the Lunar New Year, has sparked intense speculation over whether the AI sector is under pressure to outshine DeepSeek, potentially leading to another crypto market downturn.
With US AI firms investing billions into cutting-edge models, Alibaba’s advancement threatens the dominance of American AI giants, fueling concerns among investors.
Alibaba’s AI Claims Stir Market Volatility
Alibaba’s Cloud Unit, through its official WeChat account, declared that Qwen AI outperforms major AI models, including GPT-4o, DeepSeek-V3, and Llama-3-405B. A Reuters report highlights that breakthroughs like these are forcing investors to reconsider the massive spending plans of US AI firms.
The recent emergence of DeepSeek had already triggered a global market crash, affecting both stock and crypto markets. Notably, DeepSeek’s low development and usage costs—spending only $6 million compared to the $250 billion invested by US AI firms—had raised alarms. Now, with Alibaba’s Qwen surpassing DeepSeek, concerns of another market shake-up are growing.
Will Bitcoin and Altcoins Face Another Crash?
The fallout from DeepSeek’s rise led to a significant drop in the crypto market, with major AI-related coins such as NEAR, NCP, and RENDER plummeting by 8-10%. Meanwhile, BTC, ETH, and XRP also saw declines.
Now, with Alibaba intensifying the AI race, analysts fear a similar market response.
- Arthur Hayes, former BitMEX CEO, has warned of a mini financial crisis, suggesting Bitcoin could dip to $70,000 before rebounding.
- CryptoQuant CEO Ki Young Ju remains optimistic, stating that potential global Bitcoin adoption, especially with Donald Trump’s pro-crypto stance, could extend the bull run for another few quarters.
Crypto Market Sentiments: What’s Next?
Despite short-term turbulence, overall market sentiment remains bullish, particularly for Bitcoin.
- Bitcoin (BTC): Down 0.61% in the last 24 hours, currently trading at $102,394.44.
- Ethereum (ETH): Trading at $3,133.57, down 2.15%, with a possibility of further decline to $3,000.
- Global Crypto Market Cap: Declined by 1.05% to $3.47 trillion.
With 11 US states pushing for a Strategic Bitcoin Reserve, analysts believe Bitcoin may still recover strongly, making the coming weeks crucial for the market’s direction.
