DeepSeek Secures $15 Billion Windfall Amidst U.S. Federal Ban
The Hangzhou-based AI firm has closed a massive new funding round just two days after Washington mandated the removal of its software from civilian government systems.
By Kaito Sokolov ·
Federal civilian agencies in the United States are now operating without DeepSeek’s artificial intelligence tools, a directive issued just 48 hours before the Chinese startup reportedly closed a $15 billion funding round. For ordinary consumers and business users, this development signals that the company intends to continue expanding its global footprint despite the sudden regulatory friction in its largest foreign market.
According to Bloomberg, the new capital injection amounts to approximately 100 billion yuan, marking one of the largest funding events in China’s tech sector. The move occurs in a tight timeline, as the U.S. government ordered the removal of the technology from federal systems due to security concerns. This sequence of events highlights the resilience of the firm’s financial backing even as it navigates geopolitical headwinds.
Potential backers for this latest round include major Chinese industry players such as CATL, a leading battery manufacturer, and Tencent, the tech giant behind the WeChat messaging platform. The inclusion of these established corporate entities suggests a strategy to integrate DeepSeek’s capabilities into broader industrial and consumer ecosystems.
This financing follows a rapid series of financial milestones for the company. In June, DeepSeek raised more than $7 billion at a $50 billion valuation. By July, reports indicated the firm was seeking an additional $1.5 billion at a valuation near $71 billion. These steps were part of a larger plan that included a potential initial public offering in China as early as next year.
The Hangzhou-based startup is directing these funds toward expanding its AI infrastructure and developing open models for both domestic and international audiences. Despite the restrictions in the United States, the company is ramping up spending to maintain its competitive edge. Analysts suggest this aggressive expansion could intensify rivalry among other domestic AI firms seeking to capture market share.
The $15 billion raise is part of a broader trend where investors are committing billions to AI companies worldwide to stay competitive in the global race. Other recent examples include Moonshot AI, which secured $2 billion in May at a $20 billion valuation, and Manus AI, which raised over $500 million earlier this month. Publicly traded firms Zhipu AI and MiniMax, both listed in Hong Kong in January, now hold market capitalizations of roughly $29 billion and $7.2 billion, respectively.
DeepSeek was founded in 2023 by Liang Wenfeng, who previously co-founded the quantitative hedge fund High-Flyer. That fund provided the initial capital for DeepSeek’s development. The company gained significant global attention in early 2025 after releasing a free, open-weight reasoning model that challenged the dominance of U.S. AI providers. Corporate ownership data indicates that Liang still holds an estimated 81.6% stake in the firm’s Chinese operating entity.
The company has not yet provided an immediate response to requests for comment regarding the new funding round or the recent U.S. federal mandate.
