China is closely monitoring its homegrown AI startup, DeepSeek, following its rapid ascent with the launch of the R1 reasoning model. The startup now faces stricter government regulations, limiting employee travel and subjecting potential investors to government scrutiny. DeepSeek's parent company, High-Flyer, is reportedly confiscating some staff passports to enforce these restrictions. This move aligns with recent directives from the Chinese government advising AI professionals to refrain from traveling to the U.S. to protect sensitive trade information. TechCrunch has sought comments from DeepSeek.