Elon Musk’s xAI is taking Colorado to court over a new set of regulations designed to govern artificial intelligence.

The lawsuit, filed in a US district court on Thursday, seeks to stop Senate Bill 24-205 from taking effect. This law was created to prevent “algorithmic discrimination” by AI in sensitive sectors such as housing, finance, and employment.

The legal challenge centers on the idea that the state is overstepping its bounds by influencing how AI models communicate. 

In the court filing, xAI claimed that “Colorado cannot alter xAI’s message simply because it wants to amplify its own views on the highly politicized subjects of fairness and equity.” The company also noted that the mandate would hinder its mission for Grok to be “maximally truth seeking.”

Legal representatives for xAI pointed out what they see as a contradiction in the bill, which is scheduled to start on June 30. They argued that the law actually encourages “differential treatment” under the guise of trying to “increase diversity or redress historical discrimination.”

Last December, xAI sued California over the Generative AI Training Data Transparency Act. In that case, the company argued that being forced to disclose data sources violates the First and Fifth Amendments by revealing trade secrets and compelling specific types of speech. 

Amidst these state-level fights, some federal officials are calling for a change in how the industry is managed. 

David Sacks, the White House AI czar and co-chair of the President’s Council of Advisors on Science and Technology, has been vocal about the need for a national standard.

“The problem that we’re seeing right now is that you’ve got 50 different states regulating this in 50 different ways, and it’s creating a patchwork of regulation that’s difficult for innovators to comply with,” Sacks stated in late March.

President Donald Trump appointed Sacks as co-chair of the newly established President’s Council of Advisors on Science and Technology to help streamline these rules and prevent a fragmented legal landscape across the country.

Trump recently signed an executive order aimed at centralizing these policies, with the goal of “nationalizing AI policy in place of the current patchwork of state laws.” 

The administration has signaled that state-level mandates requiring AI to alter its output could be viewed as an obstruction to national interests and American leadership in the sector.

Bitcoin’s push past $73,000 quickly lost steam as the market shifted focus back to a shaky truce between the U.S. and Iran.

While a brief rally took place after rumors surfaced that Iran might accept Bitcoin as payment for cargo ships moving through the Strait of Hormuz, the excitement faded. Investors are now worried that geopolitical friction could undo the progress Bitcoin has made in the U.S. market recently.

Tensions flared when Iranian parliamentary speaker and former IRGC general Mohammad Bagher Ghalibaf criticized the ongoing military actions in Lebanon. 

Ghalibaf, a key figure in the regime, warned that any “illegal entry” or “denial of uranium enrichment” would be seen as a move to “violate the ceasefire” and could trigger a larger conflict.

This instability pushed crude oil prices back up to $97 per barrel. Rising energy costs typically pull money away from speculative assets like crypto as investors become more cautious about risk. 

However, the pressure isn’t just coming from overseas; data from the U.S. Bureau of Economic Analysis showed that the core PCE index rose by 0.4% on Thursday. This suggests that inflation is stickier than expected, making it harder for the Federal Reserve to pivot.

Economic growth is also slowing down significantly. The fourth quarter GDP was revised down to a tiny 0.5% annualized rate, signaling that the economy is almost at a standstill. 

Usually, signs of stagnation lead traders to expect the government to step in with more liquidity, but this time, the data has sparked genuine fear. A lack of faith in the plan to avoid a recession has already softened the U.S. dollar against a basket of other major currencies.

Will Bitcoin price go up?

Currently, Bitcoin is stuck in an awkward spot between these two narratives. It is trying to find a clear path while being pulled by war headlines on one side and a possible economic crash on the other. This lack of direction is visible on the charts, as the price struggles to stay above $72,000.

For the rally to continue, Bitcoin needs to chew through a massive wall of selling pressure. There are roughly $6 billion in leveraged short positions sitting between $72,200 and $73,500. Even though yesterday’s rally cleared $427 million in these bets, the remaining sell orders are acting as a heavy lid on the price.

Bitcoin needs to firmly break $73,000 and turn that level into support before it can chase new highs. If it fails to clear this liquidity soon, traders may lose heart and start taking profits, which could easily send the price sliding back toward $68,000.

Elon Musk’s artificial intelligence company, xAI, has filed a lawsuit against the state of Colorado, seeking to block incoming AI rules that restrict speech from AI chatbots like Grok.

The AI company is specifically challenging Colorado’s Senate Bill 24-205, which aims to protect AI users from “algorithmic discrimination” in areas like employment, housing and finance. 

However, in a filing to a US district court in Colorado on Thursday, xAI argued that “Colorado cannot alter xAI’s message simply because it wants to amplify its own views on the highly politicized subjects of fairness and equity.”

The company further argued that the law, set to take effect on June 30, is contradictory as it promotes “differential treatment” in an effort to “increase diversity or redress historical discrimination.”

Forcing xAI to change Grok would also interfere with its goal of being “maximally truth seeking,” it said.

Colorado isn’t the first state that xAI has sued over AI regulations. In December, it sued California over its Generative AI Training Data Transparency Act, arguing that disclosure requirements compel speech and reveal trade secrets in violation of the First and Fifth Amendments.

Related: AI agents overwhelmingly prefer Bitcoin over fiat in new study

The Colorado and California AI laws come after accusations of Grok making racist, sexist and antisemitic comments in the past.

AI rules should be left to federal regulators: David Sacks

White House AI czar David Sacks has led a push for state regulators to steer clear of crafting AI rules, arguing for a single federal standard for AI instead of a “patchwork” of state laws.

“The problem that we’re seeing right now is that you’ve got 50 different states regulating this in 50 different ways, and it’s creating a patchwork of regulation that’s difficult for innovators to comply with,” Sacks said in late March.

Sacks was appointed as co-chair of the newly established President’s Council of Advisors on Science and Technology to address that issue.

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