Can AI save X from Elon Musk?

In a move that reflects his focus on economies of scale, Elon Musk has announced that his AI startup xAI, has bought X, formerly known as Twitter, in an all-stock transaction that values the former at $80 billion and X at $33 billion.

Basically, Musk has sold a company he already owns to himself, combining advanced AI with a digital platform. In fact, xAI has been taking over X slowly but surely for some time.

There’s another factor to be taken into account other than useful synergies: since Musk acquired Twitter for $44 billion in 2022, its value has fallen to $33 billion when debt is discounted, which will be a disappointment to the investors who entered X’s latest funding round, which theoretically valued the company at $44 billion. The significant depreciation raises numerous questions about Musk’s management and ability to generate tangible value.

Some analysts have already compared this acquisition to previous moves, such as Tesla’s disputed purchase of SolarCity in 2016, highlighting potential conflicts of interest and opportunities for insider trading that occur when the same part can control both sides in a financial operation: the buyers of the debt that Musk took on to acquire Twitter will have seen it appreciate in value and most likely had privileged information about the operation.

Is this then a sound strategic move to strengthen both companies, or is it a maneuver designed to consolidate power and artificially restore the value of a troubled asset? It’s too early to say for sure, but what’s clear is that, once again, Musk is engaged in financial sleight of hand that is unlikely to come under much scrutiny given his position as the country’s de facto co-president.

Let’s be clear: this is not a fusion of equals. It’s a corporate coup for xAI’s grand vision of a future where AI not only assists, but directly owns the conversation. X.com, with its chaotic broth of human (for the moment) hard-right opinion becomes the perfect laboratory for xAI experiments, because of course, nothing advances science quite like splashing around in a quagmire of incendiary opinions and conspiracy theories. I can imagine Musk’s speech to the board: “Let’s take the loudest megaphone on the internet and make it smarter.” What could possibly go wrong?