Elon Musk shot down OpenAI's proposed ICO in 2018: court filing

Quick Take

  • Musk and his legal team claims that Sam Altman and Greg Brockman, two of OpenAI’s founders, wanted to launch a token in early 2018 to help make the company profitable.
  • At the time, Musk said “it would simply result in a massive loss of credibility for OpenAI and everyone associated with the ICO.”

Tesla CEO and billionaire Elon Musk claims to have shot down OpenAI's initial coin offering (ICO) in 2018, according to an amended court filing submitted on Nov. 14. 

Musk and his legal team claim that Sam Altman and Greg Brockman, two of OpenAI's founders, wanted to launch a token in early 2018 to help make the company profitable. At the time, Musk said, "It would simply result in a massive loss of credibility for OpenAI and everyone associated with the ICO," the filing shows. 

OpenAI initially started as a non-profit aiming to build safe artificial general intelligence (AGI). "Musk has long been concerned by the grave threat these advanced systems pose to humanity," his attorneys wrote in the filing. Musk joined OpenAI as co-chair of its board of directors and invested $44 million in the startup, providing other contributions as well. 

OpenAI wrote in a March 5 release that it needed to shift to a for-profit structure to obtain the capital necessary to fund its mission. At one point, Musk suggested merging OpenAI with Tesla to solve the AI startup's funding issues, according to both the amended filing and OpenAI's release. However, Musk left OpenAI in February 2018 and eventually launched his own AI firm called xAI.

"We're sad that it's come to this with someone whom we’ve deeply admired — someone who inspired us to aim higher, then told us we would fail, started a competitor, and then sued us when we started making meaningful progress towards OpenAI’s mission without him," OpenAI said. 

Musk sued OpenAI and its executives Altman and Brockman in August for alleged fraud, violating federal RICO, unfair competition and other complaints. The amended suit filed on Nov. 14 also named Microsoft as one of the defendants. Microsoft partnered with OpenAI and invested $1 billion in the startup in 2019

Separately, the Altman-backed Worldcoin project launched its own crypto token, WLD, in July 2023. WLD traded at $2.21 as of 11:36 p.m. ET (16:36 UTC) on Nov. 15. 

Correction (Nov. 15, 2024 — 16:50): OpenAI is unaffiliated with the WLD token.


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About Author

MK Manoylov has been a reporter for The Block since 2020 — joining just before bitcoin surpassed $20,000 for the first time. Since then, MK has written nearly 1,000 articles for the publication, covering any and all crypto news but with a penchant toward NFT, metaverse, web3 gaming, funding, crime, hack and crypto ecosystem stories. MK holds a graduate degree from New York University's Science, Health and Environmental Reporting Program (SHERP) and has also covered health topics for WebMD and Insider. You can follow MK on X @MManoylov and on LinkedIn.

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