Woofun AI reports that Chinese AI startup DeepSeek is developing a proprietary AI inference chip, aiming to reduce dependence on Nvidia and Huawei hardware. The initiative, launched approximately one year ago, remains in early stages with active discussions involving chip design firms, foundries, and storage partners. DeepSeek has also intensified recruitment for chip design engineers through private channels. Following the disclosure, Nvidia's pre-market stock price declined by approximately 1.6%. The project faces significant obstacles, including extended design cycles, substantial capital needs, and manufacturing constraints due to US export restrictions on advanced processes and high-bandwidth memory. This effort coincides with reports of DeepSeek planning a $7 billion first-round financing.