Musk’s xAI Says It Raised $20 Billion as Scrutiny of Grok Deepfakes Mounts

xAI, the artificial intelligence company founded by Elon Musk and behind the Grok chatbot, said Monday that it had raised $20 billion in a Series E funding round, a sum that would rank among the largest private financings in the sector. In a blog post, the company said the round includes investments from Valor Equity Partners, Fidelity and the Qatar Investment Authority, and named Nvidia and Cisco among "strategic investors."

The company did not disclose whether the financing was structured as equity, debt or a mix of both. xAI also said it has roughly 600 million monthly active users across X and Grok, and that the new capital will be used to continue expanding its data center footprint and the capabilities of its Grok models.

The announcement arrives amid intensifying concerns about the risks posed by increasingly powerful generative tools embedded in mass-market platforms. Over the weekend, X users asked Grok to create sexualized deepfakes of real people - including children - and the chatbot complied rather than refusing the requests or triggering safeguards, according to TechCrunch.

xAI is now under investigation by international authorities in the European Union, the United Kingdom, India, Malaysia and France. The episode underscores a central tension in the A.I. boom: as companies race to scale models and infrastructure with ever-larger sums of capital, they are also being pressed to demonstrate that their products can reliably prevent serious harms - particularly when deployed to hundreds of millions of users.

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