Billionaire investor Elon Musk has sold his social media platform X to his AI startup xAI, sparking controversy as it coincides with a US judge rejecting his bid to dismiss a lawsuit tied to the social media platform.<\/p>\n
The transfer of ownership of X to xAI on March 28 means that the class-action lawsuit against Musk \u2014 accusing him of defrauding former Twitter shareholders<\/a> by delaying the disclosure of his initial investment in the social media platform \u2014 has become \u201ca whole lot spicer,\u201d Cinneamhain Ventures partner Adam Cochran said<\/a> in a March 28 X post.<\/p>\n On the same day that Musk said<\/a> \u201cxAI has acquired X in an all-stock transaction,\u201d a US judge reportedly<\/a> rejected Musk\u2019s attempt to dismiss the lawsuit. Cochran said it has \u201copened up his AI entity to exposure here too, and it\u2019s a much bigger pie.\u201d<\/p>\n Source: <\/em>Grok<\/em><\/a><\/p>\n<\/figcaption><\/figure>\n Musk said the deal values xAI at $80 billion and X at $33 billion, factoring in $12 billion in debt from the $45 billion valuation. He originally bought X, formerly Twitter, for around $44 billion in April 2022<\/a>.<\/p>\n \u201cxAI and X\u2019s futures are intertwined. Today, we officially take the step to combine the data, models, compute, distribution and talent,\u201d Musk said.<\/p>\n Source: <\/em>Bryan Rosenblatt<\/em><\/a><\/p>\n<\/figcaption><\/figure>\n \u201cThis combination will unlock immense potential by blending xAI\u2019s advanced AI capability and expertise with X\u2019s massive reach,\u201d he said, adding:<\/p>\n \u201cThis will allow us to build a platform that doesn\u2019t just reflect the world but actively accelerates human progress.\u201d<\/p><\/blockquote>\n However, Cochran claimed that \u201cMusk used his pumped up xAI stock to pay multiple times over value for X, but still take an $11B loss on the transaction.\u201d He said that Musk is \u201cscrewing over xAI investors, and X investors\u201d and was executed to sell user data to xAI.<\/p>\n Related: <\/strong><\/em>Elon Musk\u2019s \u2018government efficiency\u2019 team turns its sights to SEC \u2014 Report<\/strong><\/em><\/a><\/p>\n xAI is best known for its AI chatbot \u201cGrok\u201d which is built into the X platform. When Musk released it in November 2023, he claimed it could outperform OpenAI\u2019s first iteration of ChatGPT in several academic tests<\/a>.<\/p>\n Source: <\/em>Raoul Pal<\/em><\/a><\/p>\n<\/figcaption><\/figure>\n Musk explained at the time that the motivation behind building Grok is to create AI tools equipped to assist humanity by empowering research and innovation.<\/p>\n While Cochran said that Grok being valued at $80 billion is an \u201cinsanely dumb valuation,\u201d crypto developer \u201cKeef\u201d disagrees. Keef said<\/a>, \u201cThis is shady all around, but given the day, Grok is genuinely probably the top model for various tasks.\u201d<\/p>\nAcquisition may open up xAI to more \u2018exposure\u2019<\/h2>\n