SoftBank Offers $1.5 Billion for OpenAI Employee Shares

TLDR

• OpenAI employees can sell $1.5 billion in shares to SoftBank through a tender offer by December 24, 2023
• The deal was facilitated by SoftBank CEO Masayoshi Son, who previously invested $500 million in OpenAI
• OpenAI’s current valuation exceeds $157 billion following recent $6.6 billion funding
• Several AI-related cryptocurrencies showed price increases following the news
• NEAR Protocol, Internet Computer (ICP), Bittensor (TAO), and RENDER experienced notable weekly gains

SoftBank has made a major move in the artificial intelligence sector by offering to purchase $1.5 billion worth of shares from OpenAI employees.

The deal, announced on Wednesday, allows current and former OpenAI employees to sell their shares to the Japanese investment company through a tender offer.

The tender offer, which gives employees until December 24 to decide whether to sell their shares, was orchestrated by SoftBank CEO Masayoshi Son. Son has shown previous interest in OpenAI, having invested $500 million in an earlier funding round.

This latest development comes at a time when OpenAI’s value continues to climb. The company recently reached a valuation of $157 billion after securing $6.6 billion in funding from various investors, marking it as one of the most valuable private companies in the technology sector.

The cryptocurrency market has responded to this news with notable movement among AI-related tokens. Several cryptocurrencies that focus on artificial intelligence technology have shown price increases in the wake of the announcement.

Near Protocol, one of the prominent AI-focused cryptocurrencies, experienced a 3% increase in price over 24 hours, reaching $6.64. The cryptocurrency has shown even stronger performance over a weekly timeframe, with an 18% increase in value.

Internet Computer (ICP), another AI-related cryptocurrency, saw its price rise by 1% in a day’s trading, reaching $11.46. The token’s price fluctuated between $10.72 and $11.59 during this period. Over the course of a week, ICP recorded a 24% increase in value.

Bittensor (TAO) demonstrated similar positive movement, with a 3% increase in price over 24 hours, bringing its value to $558. The cryptocurrency’s weekly performance showed a 20% increase, indicating sustained growth over a longer period.

RENDER, while showing some short-term decline with a 4% decrease over 24 hours to $7.46, has maintained interest from investors. The token’s price ranged between $7.13 and $7.75 during this period.

The tender offer from SoftBank represents a major opportunity for OpenAI employees to convert their equity into cash. This type of offer is common in private companies, allowing employees to gain liquidity without the company going public.

Sources familiar with the deal have noted that this tender offer is separate from any plans OpenAI might have regarding its corporate structure. The company has declined to comment on the specifics of the deal, as has SoftBank.

The timing of this investment comes during a period of increased attention on artificial intelligence technology and its applications. OpenAI, known for developing ChatGPT and other AI tools, has been at the forefront of this technological advancement.

The cryptocurrency market’s reaction suggests that investors see potential connections between traditional AI company developments and the value of AI-focused cryptocurrencies. However, it’s important to note that correlation doesn’t necessarily indicate causation in market movements.

The deal would make SoftBank one of OpenAI’s largest stakeholders, adding to the Japanese company’s portfolio of technology investments. SoftBank has a history of making large investments in promising technology companies.

Trading data shows that the market response has varied among different AI-related cryptocurrencies, with some showing stronger gains than others. The weekly performance of these tokens has generally been more positive than their daily price movements.