The Big Story 

Elon Musk’s bid to take control of OpenAI is fanning the flames on a long-time feud with CEO Sam Altman and complicating the path forward for the ChatGPT maker.

© Alex Brandon, Associated Press

Whether Musk has a real desire to run OpenAI or get ahead of a competitor, observers agree the bid is likely to slow down the artificial intelligence (AI) firm’s plans to change its corporate structure.   

Musk, an original co-founder of OpenAI, has taken great issue with the company’s for-profit ambitions, so his bid to throw a wrench in their plans was not a surprise for some in the industry.  

“The only way to stop OpenAI is [by] making their life, their fundraising more complicated,” said Lutz Finger, the founder of generative AI eCommerce company R2Decide.

A consortium of investors led by Musk submitted a $97.4 billion bid to buy the assets of the nonprofit that controls OpenAI earlier this week. Altman quickly pushed back, stating OpenAI is “not for sale.”   

OpenAI’s board of directors unanimously rejected Musk’s bid, OpenAI chairman Bret Taylor said in a post on X on Friday afternoon.

“OpenAI is not for sale, and the board has unanimously rejected Mr. Musk’s latest attempt to disrupt his competition,” Taylor said. “Any potential reorganization of OpenAI will strengthen our nonprofit and its mission to ensure AGI benefits all of humanity.”

Musk has not explicitly stated his intentions behind going after OpenAI but in a statement shared with The Hill said it is “time for OpenAI to return to the open-source, safety focused force for good it once was.”  

While Musk says he wants OpenAI to focus on safety and open-source AI models, various technology observers suggested there is more to the picture. 

The bid’s timing comes just days after reports circulated that SoftBank was close to finalizing a $40 billion deal with OpenAI that would bring the ChatGPT maker to a $300 billion valuation, nearly double its current value.

By submitting an unsolicited bid for the nonprofit arm of OpenAI, Musk is informally setting a floor value that may be far higher than the valuation of the nonprofit’s subsidiaries.   

“Now, when they [OpenAI] want to split up the for-profit and nonprofit, the state will come and ask, how much is the nonprofit worth and how much is the other profit worth?” Finger explained. “And by putting up this evaluation, Musk makes investing in OpenAI expensive.”  

Read more in a full report at TheHill.com this weekend.

Welcome to The Hill’s Technology newsletter, we’re Julia Shapero and Miranda Nazzaro — tracking the latest moves from Capitol Hill to Silicon Valley.

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Crypto Corner 

Trump signals a reset for crypto, industry leaders say

© Mark Humphrey, Associated Press

The Hill’s Miranda Nazzaro moderated a panel on emerging tech, including crypto and artificial intelligence (AI), under the Trump administration at this week’s State of the Net Conference.

In today’s issue, Miranda shares how industry insiders are viewing the new administration and what they’re looking forward to most:

The first three weeks of President Trump’s second term have stoked a lot of excitement for the crypto industry—and a growing wish list.

Kristin Smith, the CEO of Blockchain Association, argued many of Trump’s actions since returning to office have been about getting to “a neutral position” after several years of general hostility in Washington.

“We’re really trying to get back to almost a neutral position, while simultaneously trying to gear up to put in an appropriate regulatory framework because we do need new regulation and we do need new legislation,” she said. 

“Step one is sort of undoing that damage and I think the fact that we have a crypto and AI czar at the White House is mind-blowing to me,” she added. 

“It’s just been three weeks and we’ve already seen such a shift toward a more predictable regulatory landscape, which is what this industry has been begging for,” added John Mitchell, the senior manager of governmental affairs at the Consumer Technology Association (CTA).  

What’s next: President of the GliaNet Alliance Richard Whitt said Silicon Valley is seeing the world of crypto policy as a “blank slate.”  

Their wish list: Smith pointed to the need for an appropriate federal regulator for stablecoins, a federal market regulator and increased clarity over what falls into the “commodity versus security budget.”

Essential Reads 

How policy will be impacting the tech sector now and in the future:

Just 32 percent in US trust AI: Study

Mexico threatens to sue Google over Gulf of Mexico name change

TikTok returns to Apple, Google app stores amid Trump ban delay

The Refresh 

News we’ve flagged from the intersection of tech and other topics:

In Other News 

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14 states sue Musk and Trump, calling billionaire’s role unconstitutional

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