Elon Musk has successfully secured $10 billion in fresh funding for his AI company xAI, aiming to expand its influence across the tech and crypto sectors.
The funding followed renewed public tensions between U.S. President Donald Trump and Elon Musk. xAI secured the capital through a balanced mix of strategic equity investments and secured debt.
Investors moved quickly to gain exposure to Musk’s expanding ventures tied closely to artificial intelligence and cryptocurrency.
The money will be spent to build the Memphis-headquartered Colossus supercomputer of xAI and to further train its business chatbot called Grok. CNBC stated that Morgan Stanley oversubscribed the funding round, showing investors strongly supported Musk’s long-term vision.
The funding positions xAI directly against major tech rivals like OpenAI, which raised $40 billion, and Anthropic, valued at over $60 billion.
Elon Musk sold his social network X, formerly Twitter, to xAI in March in a strategic business move. The transaction integrated Grok into X directly so that individuals would interact with the social network’s artificial intelligence system. Financial estimates placed xAI’s value at $80 billion and X’s at $33 billion, after deducting $12 billion in debt.
Trump targets musk in Crypto subsidy debate
He first bought Twitter in April 2022 for $44 billion, and fiscal circles responded with equal approval and skepticism. With this latest deal, Musk’s belief in bringing digital communication, artificial intelligence services, and machine learning together in a comprehensive digital ecosystem now has stronger backing.
Elon Musk and US President Donald Trump’s rivalry intensified once more when the two of them exchanged abrasive public remarks about politics. Trump attacked Musk for benefiting from government subsidies and doubting public spending in his business ventures.
He even tweeted that DOGE, the Department of Government Efficiency, should audit Musk’s business ventures to implement budget cuts.
In response, Musk publicly called for a flat-out elimination of subsidies, denouncing any current use of federal subsidies. The last time their public confrontation occurred, Tesla lost a massive $150 billion in market value due to investor concerns over political risks.
As this discussion gains momentum, Wyoming Senator Cynthia Lummis is pushing for an amendment to the national bill that would benefit crypto users.
She proposes exempting digital payments under $300 from taxes and delaying taxes on mined or airdropped crypto until sold. These policy changes could influence future digital finance regulations during ongoing political and economic discussions.
