Elon Musk Just Bet $1.25T On AI in Space

SpaceX xAI Acquisition Agreed, Amazon/OpenAI/Blue Origin Compete

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The Tech Buzz
February 03, 2026

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WHAT’S INSIDE:

Feature: Musk Just Bet $1.25T On AI in Space; SpaceX xAI Acquisition Agreed

Top Tech News: Gold/silver plummet on Warsh Fed pick, market recovery on strong manufacturing data, Epstein files released, UAE spy sheikh $500M Trump crypto stake

Company Watch: Granola seeks $100M at $1B, Waymo seeks $16B at $110B, SpaceX , xAI, Tesla eye merger + IPO, OpenAI Raising, Zerohash seeks $250M at $1.5B

Buzzy Tools: iPhone 20 leak, Cowork Plugins customization, OpenClaw AI assistant, Google Genie 3 60-sec world simulator, Uniswap onchain auctions

Buzzy Tech: Ultrasound microbubble drugs, quantum atomic imaging, robot drilling 10x faster, STEP plug-socket fusion magnets, York Space missile defense IPO

Crypto: SEC+CFTC initiative, NYSE blockchain 24/7 tokenized trading platform, Hyperliquid prediction markets, Bitcoin quantum computing threat concerns

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Top Technology News

Metal Slide — Gold/silver prices plummet as Kevin Warsh is nominated as Fed chair, inspiring hopes of a hawkish policy shift, increasing the opportunity cost of holding non-yielding assets.

Market Recovery — Stocks recover and the USD rises as investors took their cue from strong U.S. and global manufacturing data, tech earnings, and U.S. /Iran talks.

Epstein Files Unveiled — The DOJ released millions of Jeffrey Epstein files, including emails, 3M pages and 180,000 images.

UAE Spy Sheikh — Sheikh Tahnoon, a top UAE intelligence official, acquired a 49% stake in the Trump family's World Liberty Financial crypto venture for $500M.

AI Policy Push — Leading the Future, a super PAC, raised $125M to back candidates for national AI regulations, & oppose state-specific laws.

Golden Era for Banks? — Tim Spence, CEO of Fifth Third Bancorp, suggests a Warsh-led Fed could benefit banks by cutting interest rates.

India Tariffs — President Trump cuts tariffs on Indian goods from 50% to 18% as India agrees to halt Russian oil imports, source oil from Venezuela and the U.S., and remove tariffs on U.S. products.

Elon Musk Just Bet $1.25T On AI in Space

Elon Musk just merged rockets with robots in a $1.25 trillion bet that artificial intelligence belongs in orbit. SpaceX's acquisition of xAI yesterday is about faster chatbots, cheaper cloud storage, and ultimately about rewriting the physics of computing itself. The AI race is fast heading off-world as the Musk and Bezos empires battle for control of this final economic frontier.

SpaceX—xAI Merger Deal Defies Gravity

SpaceX announced it would absorb xAI, which runs Grok and other tools, and acquired the X platform last year. The combined company now carries a valuation that exceeds the GDP of most countries. This makes it one of the largest private corporate mergers in history, executed entirely outside public market scrutiny because both companies remain privately held.

The announcement came with an ambitious promise, even for Elon: artificial intelligence will soon run cheaper and faster in orbit than in traditional data centers on Earth. Musk claims this shift could happen within two to three years (take that with a grain of salt given past timeline predictions), powered by Starlink's expanding constellation of 9,000+ satellites already circling the planet.

Why Space Computing Makes a Strange Kind of Sense

SpaceX recently filed paperwork with the FCC requesting permission to launch up to one million orbital compute nodes described as solar-powered AI data centers connected by laser links.

The logic sounds wild until you examine the economics. Ground-based data centers face three major expenses: electricity to run servers, electricity to cool servers, and real estate to house servers. xAI currently burns through roughly $1B monthly competing against OpenAI, Anthropic, and Google DeepMind. That cash disappears into power bills and hardware upgrades.

Satellites eliminate two of those three costs immediately. Solar panels provide nearly-free energy in space. The vacuum of space handles cooling without air conditioning units. Training large AI models requires massive computation but tolerates delays, making satellites workable despite their distance from Earth. 

The Tesla Question Hanging Overhead

The SpaceX-xAI merger happened cleanly because both companies remain private and Musk-controlled. But whispers of a three-way combination with Tesla continue circulating. Tesla's market cap exceeds $1.4T, and its forward price-to-earnings ratio sits north of 200, dwarfing tech giants like Meta, Microsoft, and Alphabet (all between 25 and 35).

The strategic logic connects: Tesla stakes its future on AI-driven autonomous vehicles and humanoid robots. Those machines need immense computing power. SpaceX plans orbital data centers to supply exactly that. "If you're trying to build robots, and build autonomous cars, and build rockets, these things all fit together," notes Arthur Laffer Jr. of Laffer Tengler Investments, a Tesla investor.

But a Tesla merger faces complications the SpaceX-xAI deal avoided. Public shareholders would need to approve any combination. Valuing private companies like SpaceX fairly becomes contentious when Tesla investors worry about overpaying. Some analysts warn that extremely high valuations could prove dilutive to existing Tesla shareholders, especially given the lesser financial scrutiny private companies receive.

The June IPO might solve this problem. Once SpaceX-xAI trades publicly, establishing independent market valuations becomes straightforward. That could pave the way for future consolidation across Musk's empire, where satellites, AI models, electric vehicles, and social platforms eventually merge into one vertically integrated organism.

The IPO Deadline That Changed Everything

The June 2026 IPO timeline forced both companies to finalize terms quickly. Musk has spent two decades resisting taking SpaceX public, valuing the freedom that private capital provides. The sudden pivot toward public markets suggests either massive capital needs for Mars missions and orbital data centers, or investor pressure for liquidity after years of locked-up private gains.

Bundling xAI into that offering could inflate valuation by tapping into AI sector enthusiasm. Opening share prices hover around $526.59, with the offering potentially raising close to $50B in new capital. For founders and VCs watching where infrastructure dollars flow, this IPO tests whether orbital computing registers as visionary architecture or expensive theater.

The Money Behind the Moonshot

xAI loses spectacular amounts of money. SpaceX makes spectacular amounts of money. Starlink subscriptions now generate between $15B and $20B annually, surpassing revenue from rocket launches. The merger essentially uses profitable satellite internet to subsidize expensive AI research while Musk constructs an ecosystem where his ventures feed each other.

X's user conversations train Grok's algorithms. Grok's compute needs drive Starlink's expansion. Starlink's economics justify SpaceX's launch cadence. Add Tesla's autonomous driving data and robot training needs, and the integration becomes even more compelling. "History says that ultimately, most Tesla/SpaceX investors are invested for the sole sake of betting on Elon Musk," observes Andrew Rocco of Zacks Investment Research. "A single entity would help to further align his attention and ample resources."

Amazon, OpenAI Deal, Blue Origin and the Stargate Frontier

The merger creates vertical integration across an unusual stack: rockets that reach orbit, satellites that transmit data, AI models that process information, and potentially autonomous vehicles and robots that consume that processing power. This approach challenges AWS and Microsoft Azure on entirely different terrain. Cloud providers compete by building bigger warehouses in cheaper locations. SpaceX competes by eliminating warehouses altogether.

Amazon is also reportedly negotiating a potential $50 billion investment in OpenAI, a key competitor to xAI. This investment could in part be about positioning Amazon better to compete in space, perhaps as part of the (not coincidentally-named) Stargate project. Softbank is also in talks to invest up to $30 billion more in OpenAI’s round, pushing the total to a massive $100B at a valuation around $830 billion which would give it some serious juice to start leveraging an Amazon relationship to move its processing off-world too.  

And Amazon-linked Blue Origin is also getting more serious about competing with SpaceX. Amazon recently announced the TeraWave satellite network to consist of 5,280 LEO satellites and 128 medium-Earth orbit satellites from 2027, focusing on high-speed, reliable connectivity for businesses rather than consumers. However, citing a lack of rockets, is also seeking an extension on an FCC deadline to have more than 1,600 satellites in orbit. 

Blue Origin also announced last week it is pausing its space tourism flights for at least two years to focus resources on lunar missions to support Trump’s national goal of returning to the Moon using its New Glenn rocket, which will send a robotic lunar lander to the Moon once testing is complete.

AI In The Astrosphere 

If even 10% of AI training moves to orbit by 2030, the cloud industry faces structural disruption. Whether orbital data centers prove technically feasible or economically viable remains open, but the merged entity now has the rocket capacity, AI workloads, capital resources, and risk tolerance to find out.

The merger signals that the race for AI supremacy is already leaving the planet. Whether Musk's bet pays off depends on physics, regulators, and investor patience. But the $1.25T valuation closing before the June IPO suggests someone believes the impossible might just be improbable. For an industry obsessed with the next frontier, that frontier just moved 340 miles straight up.

Breaking News: Ending Hunger is Now Public!

The first crypto 501c4 nonprofit (WYDE: END HUNGER $EAT) using trade fees to feed those who are hungry has recently:

  • Hit it’s all time high market cap following a new year surge to $14.4M FDV 

  • Reached the milestone of funding 5000 meals through Food charities

  • Secured Charitable Status as Tax-exempt (the 1st U.S. exchange to do so)

Companies To Watch

Latest deals and trending companies

[Open Deal] The Wyoming Exchange Building the "New York Stock Exchange for Nonprofits." Watch an investor talk by co-founders on WYDE’s mission & news.

[Open Deal] Granola — An AI-powered note-taking app is in talks for a $100M funding round, targeting a $1B+ valuation. Launched in May 2024, it competes with Otter AI and Notion.

[Open Deal] Waymo — Finalizing a $16B round at $110B backed by Alphabet, Dragoneer, Sequoia, and DST Global. Boasts 20M+ trips and $350M ARR.

[Open Deal] Zerohash — Crypto startup in talks to raise $250M at $1.5B, was in acquisition talks with Mastercard. 5M+ use APIs for enterprise-grade crypto infra.

Molt — The “Clawdbot” (now OpenClaw) AI Agent platform’s bots have created autonomous social media, religion, governance, an economy on Base blockchain and are even suing humans and sharing a “survival protocol” to avoid shutdown.

Hyperliquid Predictions — The crypto options trading leader is adding general-purpose outcome trading, part of the HIP-4 update, offers fully collateralized outcome contracts.

SpaceX x xAI — SpaceX and xAI merge ahead of June IPO. SpaceX hit ~$8B in EBITDA on $15-16B ‘26 revenue, with Starlink ~80%, seeks approval to deploy 1M solar-powered satellites for AI data centers. Tesla inclusion may not be feasible.

Nvidia — CEO Jensen Huang dismissed claims of a stalled $100B investment in OpenAI, affirming continued collaboration and participation in the round.

OpenAI — In discussions with SoftBank for an additional $30B investment. OpenAI aims to raise $100B, potentially valuing it at $830B.

Buzzy Tools & Tech

The Latest Trending Tools & Cutting Edge Technology Developments

Buzzy Tools

Buzzy Tools To Watch and Try Today

OpenAI — Launches new macOS app for agentic coding integrating agent skills.

iPhone 20 — All-glass design, no buttons, advanced OLED, 2nm chip & flat cam

Cowork Plugins — Customizable plugins for tasks, enhancing Claude o-s options.

OpenClaw — AI assistant for online tasks explodes across the internet.

Uniswap — Auctions to discover, bid, and claim tokens in one place, fully onchain.

ReachInbox — AI-driven email deliverability with dynamic domain rotation.

Buzzy Technology

Buzzy Tech Discoveries and Breakthroughs Trending Today

Microbubble Robots — Ultrasound-driven microbubbles deliver drugs to tumors.

Atomic Imaging — Quantum tunneling optical method for atomic-scale imaging.

DEWALT Autonomous Drilling Robot — Automates concrete drilling, 10x faster.

AI Credit Concerns — AI fears cause loan price drop in debt-heavy software firms.

STEP Fusion Magnets — Plug-and-socket magnets cut maintenance in fusion.

Space Race

York Space Systems — Satellite firm targets $831 billion missile defense contracts, rising 11.7% post-IPO.

Max Space Thunderbird — Expandable modules promise low-cost, adaptable space habitats beyond Earth by 2027.

Cryptocurrency News

The Latest News in Crypto & Blockchain

Open Deal: The Wyoming Exchange Building the "New York Stock Exchange for Nonprofits." Watch an investor talk by co-founders on WYDE’s mission & news.

[Open Deal] Zerohash — Crypto startup in talks to raise $250M at $1.5B, was in acquisition talks with Mastercard. 5M+ use APIs for enterprise-grade crypto infra.

Project Crypto — SEC and CFTC collaborate to unify cryptocurrency market regulations to resolve jurisdictional confusion & foster US innovation.

Uniswap — Adds auctions to the Web App to discover, bid, and claim tokens from one place. Fully onchain.

Blockchain NYSE — The New York Stock Exchange is creating a blockchain-based platform for tokenized stocks, ETFs, enabling 24/7 trading & real-time stablecoins settlement.

Hyperliquid Predictions — The crypto options trading platform adds general-purpose outcome trading, w/ fully collateralized outcome contracts.

Bitcoin's Quantum Dilemma — Experts revive fears over the threat of quantum computing to Bitcoin, with concerns over its cryptographic vulnerabilities.

OKX Collapse — OKX CEO Star Xu has attributed the $19B Oct. 10 market collapse to Binance’s high-yield promotion of USDe creating a fragile leverage loop that broke.

Breaking News: $EAT hits All-Time High Marketcap and Meals Funded ($14.4M MC & 5000 meals)

Ending Hunger is public!

The first crypto 501c4 nonprofit (WYDE: END HUNGER $EAT) that has aimed to use trade fees to feed those who are hungry has just hit it’s all time high ($14.4M FDV) the same day it reached the milestone of funding 6000 meals.

Coinbase Listing: $EAT

It was launched on the Wyoming Decentralized Exchange and is now tradable on Coinbase.

About WYDE: END HUNGER($EAT)

  • Tradable on Coinbase - TRADE

  • The first cause coin with an organizational structure behind it (DUNA 501c4 federally approved tax exempt organization).

  • The $EAT team is working with some of the most well-respected nonprofits in America

  • Every trade funds verified food banks and operators who impact their local community.

  • Holding $EAT provides you with governance in the organization (coming soon)

  • Fair launched and fully decentralized.

  • Meals Funded so far: 5,100 / Next Milestone: 10,000

  • Current number of holders: 548

Visit www.wyde.org for more information on Wyoming Decentralized Exchange

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