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Today’s Menu

• Elon combines X and xAI in massive $113B merger

• Bitcoin holders show growing conviction as 68% of supply turns long-term

Markets

TODAY IN AI

Bitcoin holders show growing conviction as 68% of supply turns long-term

Elon Musk has announced the merger of his AI startup xAI with social media platform X in an all-stock transaction, creating a new entity called xAI Holdings valued at over $100 billion.

The deal values xAI at $80 billion and X at $33 billion, with an additional $12 billion in debt bringing X's enterprise value to $45 billion. This formal combination cements what many observed as an already intertwined relationship, with xAI's Grok chatbot integrated into X and leveraging the platform's vast user data for training.

Musk emphasized that the two companies' futures are "intertwined," with the merger "blending xAI's advanced AI capability and expertise with X's massive reach." The new xAI Holdings Corp will consolidate resources, combining "data, models, compute, distribution, and talent" under one roof.

This move comes after a turbulent period for X since Musk's 2022 acquisition of Twitter. While the platform has faced challenges, its value as both a training data repository and distribution network for Grok remains substantial. The merger effectively turns X into an AI-first company with built-in distribution.

What smart observers realize: This isn't just about efficiency - it's about creating an integrated AI ecosystem that can compete with giants like OpenAI and Google. By formalizing this relationship, Musk gains greater control over both the technology and its distribution channel, potentially accelerating xAI's development cycle.

^{Today In Crypto}

Bitcoin holders show growing conviction as 68% of supply turns long-term

The Bitcoin market is showing strong signs of investor conviction, with the Long/Short-Term Holder Threshold revealing significant accumulation patterns.

Currently, coins purchased before October 27th, 2024 (when Bitcoin traded around $67,940) are classified as Long-Term Holdings. A remarkable 13,472,258 Bitcoin, or 67.89% of the circulating supply, now sits in the hands of these long-term holders. In contrast, short-term holders control just 3,729,031 coins, representing 18.79% of supply.

The trend is accelerating, with approximately 302,548 BTC transitioning from short-term to long-term holder status over the past 30 days alone. This migration signals growing investor conviction rather than speculative trading.

Historically, increasing long-term holder supply tends to precede major bull runs. As more investors commit to holding Bitcoin for extended periods, available market supply tightens, creating potential upward price pressure when new demand enters.

The strategic insight: While price volatility captures headlines, the underlying holder behavior tells a more compelling story. The significant shift toward long-term holding suggests market participants are positioning for substantial future appreciation rather than quick profits. With Bitcoin's fundamentals arguably stronger than ever, this growing conviction appears well-founded.

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Thanks for reading!

Until next time,

Damon James