Elon Musk, the billionaire CEO of Tesla and co-founder of OpenAI, has reportedly rejected OpenAI CEO Sam Altman ‘s proposal to launch a cryptocurrency token in early 2018, warning that it could damage the company’s reputation.
According to a recent document filed in the U.S. District Court for the Northern District of California, Musk rejected the idea of an initial coin offering (ICO), calling it a potential “scam.”
The court document filed on November 14 reveals Musk’s concerns about the damage such a move would do to OpenAI’s credibility. “Musk rejected the idea, stating that it would lead to a huge loss of credibility for OpenAI and all those associated with ICOs,” the document reads.
This proposal by Altman came just months after discussions about OpenAI ‘s transition from its original non-profit model to a for-profit entity. Musk’s legal team noted that in September 2017. Altman and Greg Brockman, OpenAI’s current CEO, initially presented the for-profit idea, which Musk opposed.
He reportedly warned them to either operate as a nonprofit organization or pursue separate ventures.
In a statement to Altman and Brockman, Musk wrote: “I will no longer fund OpenAI until you commit to stay, otherwise I’m just a fool who is essentially providing free funding to a start-up.”
The legal dispute between Musk and OpenAI escalated earlier this year. In February, Musk sued the organization for allegedly breaking its promise to remain a non-profit organization.
Although the case appeared to be dropped in June, Musk resumed legal proceedings in August, further accusing Altman and Brockman of seeking personal financial gain at the expense of OpenAI’s mission.
The lawsuit also alleges that after Musk rejected the ICO proposal, Altman and Brockman began developing a plan to turn OpenAI into a for-profit model in order to secure funding.
Musk’s lawyers described this as another “get-rich-quick scheme” by the two leaders. On the same day that the charges were filed, a separate legal case involving Musk was resolved. Plaintiffs in a 2022 class action accusing Musk of manipulating Dogecoin prices withdrew their appeal.
According to reports, the plaintiffs have agreed to take no further legal action against Musk or Tesla.
Dogecoin reaches new peaks
Although the legal battle is dimming, Dogecoin remains central to Musk’s public persona. The price of the meme coin surged this week, rising more than 83% to $0.36, driven by recent political and economic developments.
Musk’s relationship with Dogecoin reached new heights following his appointment as co-director of the proposed Department of Government Efficiency (D.O.G.E.), part of President-elect Donald Trump’s administration.
The initiative, seen as a nod to the playful acronym Dogecoin, has brought the cryptocurrency into the mainstream political discourse. The newly formed DOGE will offer external advice and guidance to the US government, while working with the White House and the Office of Management and Budget.
Its mission includes implementing structural reforms and fostering an entrepreneurial approach to government operations. One of DOGE’s key tasks is to address inefficiencies in the federal government’s $6.5 trillion in annual spending .
