Amid the deepfake scandal: Billion-dollar injection for Grok company
Elon Musk's AI company xAI has raised more money than expected in its latest funding round. Meanwhile, its chatbot is causing a scandal.
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Amid the ongoing scandal surrounding the AI generation of sexualized deepfakes from images of women and children on X, Elon Musk's AI company has raised 20 billion US dollars (approximately 17 billion euros) in fresh capital. xAI announced this in a blog post, stating that the money comes from Nvidia, Cisco, various financial service providers, and the Emirate of Qatar, among others. With this immense capital injection, the AI company intends to rapidly expand its own infrastructure and build the “world's largest GPU cluster.” The GPU manufacturer Nvidia is likely to receive some money back.
Nvidia finances another customer
xAI does not provide details on the terms of the capital injection in its text. However, according to Bloomberg, preparations took months. Nvidia reportedly wanted to invest up to two billion. The exact amount is not public. According to the report, 12.5 billion US dollars in debt were to be raised to purchase Nvidia chips, which would then be leased to partially finance the costs. Circular deals, where Nvidia invests in companies that buy the group's chip systems, are currently typical for the AI business. xAI plans to further expand its massive data center in Memphis, Tennessee. The AI company is primarily known for its chatbot Grok, which is integrated into the X microblogging service.
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Grok has already caused outrage worldwide for days. Users are using the AI account to digitally “undress” photos of women and even minors. The creation of these sexualized images is possible without the consent of the individuals concerned, and the results are publicly visible on the microblogging service. Although X has allowed the AI account to spread the claim that these were only “isolated cases” and that a root “failure of security measures” has been fixed, the chatbot has not stopped. The AI continues to fulfill corresponding user requests, and the AI's profile is still full of such images. Several states and the EU have heavily criticized this and promised measures; however, there have been no consequences yet.
(mho)
