Musk evaluates possible Tesla $5 billion xAI funding amid its steady Bitcoin reserves

Elon
Musk
appears
to
be
considering
whether
his
Electric
Vehicle
(EV)
manufacturing
company,
Tesla,
should
invest
$5
billion
in
his
artificial
intelligence
(AI)
startup,
xAI.

On
July
24,
Musk
polled
his
followers
about
the
potential
investment,
with
early
results
showing
support
for
the
move.
However,
Musk
clarified
that
the
poll
was
only
exploratory
and
any
decision
would
need
board
and
shareholder
approval.

Musk

said:

“Board
approval
and
shareholders
vote
are
needed,
so
this
is
just
to
test
the
waters.”

As
of
press
time,
more
than
500,000
people
had
participated
in
the
poll,
with
around
69%
voting
in
favor
of
the
move.

Meanwhile,
this
poll
has
raised
concerns
about
Musk
diverting
Tesla’s
resources
to
other
ventures.
Yet,
during
Tesla’s
July
23
earnings
call,
Musk
dismissed
these
worries.
He
emphasized
that
xAI
could
advance
Tesla’s
self-driving
capabilities
and
aid
in
developing
a
new
data
center.
Musk
also
mentioned
opportunities
to
integrate
xAI’s
chatbot,
Grok,
with
Tesla’s
software.

However,
if
the
investment
gets
approved,
it
would
substantially
increase
xAI’s
valuation
to
more
than
$24
billion.
The
move
would
also
provide
the
AI
startup
adequate
funding
to
compete
with
leaders
like

OpenAI,

Google,
and
Anthropic
in
the
generative
AI
field.

Tesla’s
Bitcoin
holdings
unchanged

In
a
parallel
development,
the
earnings
call
also
revealed
that

Tesla’s
Bitcoin
holdings
remained

unchanged
for
the
eighth
consecutive
quarter,
with
no
purchases
or
sales
between
April
and
June
2024.

The
report
shows
the
firm
held
$184
million
of
digital
assets
as
of
June
30.
However,
Bitcoin
Treasuries

data
pegs
Tesla
as
the
world’s
third-largest
Bitcoin
holder,
behind
MicroStrategy
and
Marathon
Digital.
The
EV
manufacturer
holds
9,720
Bitcoin,
valued
at
about
$640
million
at
press
time.

Tesla
began
its
Bitcoin
journey
in
February
2021
by
purchasing
$1.5
billion
worth
of
Bitcoin.
In
the
second
quarter
of
2022,
it
sold
over
30,000
Bitcoin
for
$936
million.
Since
then,
Tesla
has
remained
silent
about
its
Bitcoin
holdings
despite
community
calls
for
more
purchases.

Mentioned
in
this
article

Posted
In:

Bitcoin,

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Author: Oluwapelumi Adejumo

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