Musk Allegedly Used Deepfakes Controversy to Boost X's Value

French prosecutors are investigating Elon Musk for allegedly encouraging the creation of sexualised deepfakes on the social media platform X to artificially inflate its value ahead of a planned stock market listing in June 2026. The AI chatbot Grok generated approximately three million sexualised images, including 23,000 that appeared to depict children, within 11 days. Prosecutors have alerted US authorities, including the Department of Justice and the SEC, regarding these concerns. Musk has publicly dismissed the investigation, calling the prosecutors 'mentally retarded.' The controversy has also drawn scrutiny from British and EU regulators, who are examining the implications of the deepfakes on political interference and other serious allegations. The incident has led to a significant increase in Grok's app downloads, rising by 72% during the controversy.

Key Points: • French prosecutors suspect Musk encouraged deepfakes to inflate X's market value. • Grok AI generated around three million sexualised images in just 11 days. • Investigations are ongoing in France, the UK, and the EU regarding the implications of these deepfakes.