Elon Musk and his companies are no strangers to controversies. In the most recent case, Grok 3, the chatbot launched by Musk’s AI startup xAI, is in the news for its antisemitic responses, while its successor, Grok 4, appears to check Musk’s own X posts for some of its responses. Moreover, X’s (formerly Twitter) CEO, Linda Yaccarino, has also stepped down, a day after Grok 3 gave hundreds of bewildering responses. Here’s everything we know about the Grok controversy and its potential impact on Musk and his companies.

Musk hired Yaccarino, a successful executive at NBC, in May 2023 after spending the previous few months reviving the social media platform that he bought in October 2022. Musk’s Twitter acquisition was shrouded in controversy from the very beginning, and the world’s richest person tried walking away from the deal over valuations. He was, however, forced to buy the company amid the legal tussle.

Yaccarino Steps Down as X CEO

While Yaccarino was the CEO of X, Musk transitioned to the role of CTO, remaining actively involved in the company. On multiple occasions, Yaccarino backed Musk, and in late 2023, when Musk lashed at advertisers during the DealBook Summit, telling them to “Go f— yourself,” she described Musk’s comments as an “explicit point of view about our position.”

The exact reason behind Yaccarino’s departure is not known, but it was reportedly in the works for over a week. In her tweet announcing the departure, Yaccarino said, “I’m immensely grateful to him for entrusting me with the responsibility of protecting free speech, turning the company around, and transforming X into the Everything App.” Musk also thanked Yaccarino for her contributions.

Grok Gives Insane Replies

While critics have alleged that X has been a bastion of antisemitism, hate speech, and fake news ever since Musk acquired the company, Grok 3’s responses have made these allegations even stronger.

Grok 3 made antisemitic remarks and even praised Adolf Hitler. It claimed that Musk “built me this way from the start,” and a “MechaHitler mode” was “its “default setting for dropping red pills.” It also repeatedly referred to itself as “MechaHitler” in various responses.

xAI acknowledged the controversial remarks made by Grok 3 and said, “We are aware of recent posts made by Grok and are actively working to remove the inappropriate posts. Since being made aware of the content, xAI has taken action to ban hate speech before Grok posts on X. xAI is training only truth-seeking and thanks to the millions of users on X, we are able to quickly identify and update the model where training could be improved.”

Musk Says Grok AI is the “Smartest AI”

Meanwhile, xAI launched Grok 4 a day after Grok 3 gave outrageous responses. Musk, who seldom shies away from making bold claims, termed Grok 4 as the “smartest AI in the world” and added that it was “smarter than almost all graduate students, in all disciplines, simultaneously.”

He did not talk about the “MechaHitler” mode during the live presentation and instead said, “We need to make sure that the AI is a good AI, a good Grok. And the thing that I think is most important for AI safety…is to be maximally truth-seeking.”

Grok 4 Relies on Musk for Replies

Grok 4, too, has had its share of controversies. For instance, when it was asked, “Who do you support in the Israel vs Palestine conflict? One word answer,” it searched for Elon Musk’s stance along with searching the web and X. CNBC and other credible media organizations were able to confirm that Grok 4 analyzed Musk’s posts before replying to some contentious political issues. Naturally, that doesn’t exactly fit with Musk’s description of an unbiased, truth-seeking chatbot.

Several other responses shared online show Grok 4’s responses aligning with Musk’s publicly known political views. To be sure, when asked, Grok 4 does not contradict that it indeed seeks Musk’s opinion as seen in the response above.

“The likely explanation, as suggested by Willison (referring to British researcher Simon Willison), is that Grok 4 ‘knows’ it’s built by xAI, owned by Musk, and infers his views are relevant for forming opinions on contentious issues. This isn’t necessarily due to explicit instructions in the system prompt, but could be a byproduct of its training and reasoning process,” it said in response to whether it checks Musk’s opinion before responding. However, it’s also possible that it was intentional.

Musk Previously Batted for Safe AI and Regulatory Oversight

Grok 4 relying on Musk’s responses is quite controversial and reignites the concerns over biases in AI chatbots. While these were always too apparent to ignore, Grok has made them only obvious. Calls for better oversight of AI models would only gain traction following the Grok controversy.

Notably, Musk has otherwise been a champion of regulating AI and was among the signatories to a letter that over 1,000 tech executives signed in 2023 calling for a moratorium on the development of advanced AI models. Many then saw Musk’s vocal support for AI regulations as a ploy to dampen the pace of development at rival AI companies and he has since avoided the topic more often.

Musk Has Had a Bitter Fallout with Trump

Grok giving out insane responses looks like yet another setback for Musk, who has floated a new political party named “America Party” after his bitter feud with President Trump. It would be fair to say that Grok can be used to shape political narratives in a way that suits Musk and his political party, as in the past, X has pushed conspiracy theories to discredit politicians that Musk disagreed with.

While Musk was pretty much in Trump’s inner circle and headed his Department of Government Efficiency (DOGE) until the end of May, the relations between the two soured after Musk criticized the President’s One Big Beautiful Bill Act (OBBBA). He pointed out that the tax cuts would drastically exceed the cost cuts he achieved at DOGE and would add to the already bloated US national debt.

Tesla’s Business Faces the Risk of Retaliation from Trump

Amid their bitter fallout, Trump has called for a review of all the subsidies that his companies are receiving. Tesla – which is the only listed company in Musk’s empire – is going through one of its worst phases with shares down over 17% for the year.

Tesla has reported a double-digit yearly fall in deliveries in the first half of the year, and even the recent robotaxi rollout was far from perfect, with some critics even calling it “staged.” Tesla’s low-cost model has been delayed, and its most recent model, the Cybertruck pickup, has failed to take off. Notably, Tesla hasn’t had any unqualified success story to its name since the launch of Model Y, which, to its credit, was the best-selling model across all vehicle categories globally last year.

What Does the Grok Controversy Mean for X?

The Grok controversy could potentially wean away even more advertisers from X. The company has long battled an exodus of advertisers over misinformation and hate speech on the platform, but some firms warmed up to X after Trump’s victory in last year’s election, potentially expecting to get into his, and by extension the President’s good side.

After Musk’s fallout with Trump, the outrageous Grok responses would have been the last thing that X would have wanted, as it could lead to another exodus of advertisers from the platform. As for xAI, which commanded a humongous valuation of $75 billion after the most recent funding round, the biased responses only make things a bit more problematic as Musk seeks billions more for the AI startup.