Trump vs Musk feud escalates after Musk’s xAI lands $10B funding

Elon Musk’s artificial intelligence venture, xAI, has secured a staggering $10 billion in fresh funding, doubling down on its rivalry with OpenAI—but the victory comes as his feud with former President Donald Trump reaches a boiling point. The Trump vs Musk battle, reignited over government subsidies and crypto threats, is shaking both tech and political circles.

Musk’s xAI secures massive funding amid AI arms race

xAI’s latest funding round, split between secured debt and strategic equity investments, will fuel the expansion of its Memphis-based supercomputer, Colossus, and enhance its AI chatbot, Grok. According to CNBC, the round was oversubscribed, with major investors clamoring for a stake in Musk’s AI ambitions.

This financial boost comes as competitors like OpenAI and Anthropic dominate the AI landscape with multi-billion-dollar valuations. OpenAI recently raised $40 billion at a $300 billion valuation, while Anthropic’s latest funding pushed its worth past $60 billion.

Musk has aggressively positioned xAI as a key player, integrating Grok into his social media platform X (formerly Twitter) earlier this year. The deal valued xAI at $80 billion, further solidifying Musk’s influence in the tech world.

Trump vs Musk: Subsidy war escalates with DOGE threat

While Musk celebrates his AI triumph, Trump has launched a fresh attack, accusing the billionaire of relying on government subsidies. On Truth Social, Trump suggested that the Department of Government Efficiency (DOGE) should investigate Musk’s businesses to “cut costs.”

“No more rocket launches, satellites, or electric car production, and our country would save a FORTUNE. Perhaps we should have DOGE take a good, hard look at this? BIG MONEY TO BE SAVED!!!” Trump wrote.

Musk fired back on X, declaring, “I am literally saying CUT IT ALL. Now,” distancing himself from federal support. This latest Trump vs Musk clash echoes past conflicts—last June, Tesla lost $150 billion in market value after a similar dispute over government spending.

Musk’s political moves and crypto tax battle

The Trump vs Musk feud isn’t just about subsidies. Musk has increasingly waded into politics, criticizing lawmakers who backed recent spending bills and even hinting at supporting primary challenges against them. His calls for a new political party to counter government excess have further fueled tensions.

Meanwhile, Senator Cynthia Lummis has introduced a crypto-friendly amendment to Trump’s tax bill, aiming to ease tax burdens on digital asset users. The proposal includes waiving taxes on small crypto transactions and delaying taxes on mining and staking rewards until sale.

Earlier, the Senate rejected a Democrat-led amendment that sought to ban government officials from holding or promoting crypto for a year after leaving office—a move that could have impacted memecoins like Dogecoin, which Trump once threatened to “unleash” against Musk.

The high-stakes battle ahead

The Trump vs Musk rivalry is more than a war of words—it’s a clash of ideologies, with massive financial and political consequences. As Musk pushes AI innovation and Trump takes aim at government-backed tech ventures, the outcome could reshape industries and influence the 2024 election.

With billions at stake and crypto now dragged into the fight, the Trump vs Musk saga is far from over. One thing is certain: when two of the world’s most powerful figures collide, the fallout will be anything but predictable.