Elon Musk has singled out the country he believes poses the biggest challenge in the global race to build artificial intelligence.
In a post on X, the Tesla and SpaceX chief Elon Musk wrote that “China is also by far the strongest competitor in AI,” responding to a resurfaced comment he made in 2011 about the country’s long-term challenge in rocket technology.
The remark quickly circulated among technology and policy watchers.
Musk has repeatedly pointed to China’s rapid progress in AI models, manufacturing scale and energy capacity as factors that could allow Chinese companies to take the lead.
A consistent view on the competition
Musk’s latest comment builds on earlier statements. In a recent interview he said there is “a good chance” Chinese AI firms will become the leaders if they gain greater access to computing power.
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He has noted that Chinese labs are already delivering strong results with relatively limited compute resources.
Electricity and advanced chips remain the main constraints on AI development, he has argued, and China holds a clear advantage in power generation.
Musk has also highlighted China’s strength in robotics and physical AI systems. He has described Chinese companies as highly capable at scaling manufacturing, a point he has made when discussing Tesla’s own humanoid robot efforts.
Trending on TheStreet Roundtable: Why the warning carries weight
The post comes as independent assessments show the performance gap between leading U.S. and Chinese AI models has narrowed significantly. Reports indicate the two countries have traded the top spot in certain benchmarks over the past year.
While the United States still leads in private investment and the number of notable models released, China dominates in research papers, citations and patents.
Musk has long warned about the broader risks of advanced AI, including the possibility of systems that escape human control.
His focus on China frames the race not only as a technological contest but as a strategic one with national implications.
For now, his message is straightforward that in AI, as in rocketry years earlier, China stands as the primary challenger.
Where crypto enters the picture
Musk’s emphasis on power and compute as the true bottlenecks helps explain a shift already reshaping the crypto industry. Bitcoin miners, which run large, energy-hungry data centers, have been repositioning themselves as AI infrastructure providers, leasing their power capacity to AI companies desperate for it. The logic mirrors Musk’s own: whoever controls electricity and computing capacity holds an edge in the AI race.
The deals have been striking in scale. In December 2025, Hut 8 signed a 15-year, $7 billion lease with cloud provider Fluidstack for 245 megawatts of capacity at its River Bend campus in Louisiana, tied to a broader partnership to host AI workloads for Anthropic. In July 2026, TeraWulf signed a 20-year lease with Anthropic expected to generate roughly $19 billion in contracted revenue, a figure that exceeded the miner’s entire market value at the time. Closer to home for U.S. readers, Riot Platforms struck a $9 billion, 20-year compute deal with Anthropic in August 2026, leasing 191 megawatts at its Texas campus.
Together, these deals show how scarce, grid-connected power has become one of the most valuable resources in the AI buildout.
This story was originally published by TheStreet on Aug 20, 2026, where it first appeared in the MARKETS section. Add TheStreet as a Preferred Source by clicking here.