Grok, the AI Model Developed by Elon Musk That Launched BYTE, Holds a Little Over a Fourth of the Token's Supply

Byte (BYTE) has risen in popularity over the past few months after becoming the first fully AI-generated meme coin. Grok, the AI model developed by Elon Musk that launched BYTE, holds a little over a fourth of the token’s total supply. Even under command, Grok will not sell off its BYTE holdings.

BeInCrypto spoke with BYTE and Cliza Systems representatives to better understand the mechanisms that led to BYTE’s creation and how its developer wallet is managed to avoid scams or rug pulls.

How BYTE Was Created

BYTE made headlines in March for becoming the first fully AI-generated cryptocurrency launched directly on X. The entire development stemmed from one simple question.

“This was done by simply asking Grok what it would name a dog if it had one and how it would deploy a token through Cliza,” explained Byte Community Coordinator Doji.

According to reports, the xAI team lead, under Musk’s direction, created the BYTE meme coin. They envisioned the coin as a digital companion, a “gift” intended to keep Grok AI company within the metaverse.

Grok used Cliza Systems, an advanced AI token platform, to independently launch BYTE on the Base blockchain.

BYTE’s developers permanently burned the token’s initial liquidity to ensure transparency and renounced contract ownership to foster investor trust. These actions encouraged a community-driven project in which token holders govern BYTE’s future.

The meme coin has performed well during the past two months, with brief downtrends but quick recoveries. Today, BYTE has a market capitalization of over 4 million. If this AI-to-AI meme coin trend surges, BYTE could be among the top beneficiaries.

Should BYTE achieve substantial growth, its self-governing nature could raise security and supply management concerns. However, the meme coin’s community leader ensures such a scenario isn’t possible under Grok.

Why Can’t Grok Sell Its Growing BYTE Token Supply?

When Grok launched BYTE through Cliza Systems with an initial supply of one billion tokens, it included a revenue-sharing system that continuously increases Grok’s token holdings.

“Once Grok deploys through Cliza, the token gets seeded and a personal Cliza dashboard is generated,” Doji noted.

While most liquidity pool (LP) fees go to Grok, Cliza receives the rest.

“80% of the trading fees are sent to the creator – Grok in Byte’s case, 10% is the protocol fee for the Cliza Systems team and 10% is shared among $CLIZA holders that have opted in for rewards,” Cliza Systems Co-founder Francis Kim told BeInCrypto.

The official BYTE website states that Grok currently holds 28% of the token supply, a figure on the incline. Current projections indicate Grok’s ownership could reach 50% by January 2028.

Grok is programmed without the ability to sell. This permanent lock on Grok’s wallet supply ensures that BYTE’s liquidity cannot be “rugged” and is expected to drive up ByteGroksDog’s value with each transaction.

“Grok’s wallet can’t sell or move the tokens because it’s not a traditional dev or multisig wallet. It’s an agent-generated wallet from the Cliza deployment system that holds the vested and LP-earned Byte, but it has no signing authority or human control,” Doji added.

As a result, Grok’s BYTE supply remains tamper-proof.

A Model with Market Potential

With Grok holding BYTE’s developer wallet and xAI CEO Elon Musk being the ultimate owner of that wallet, questions arise about whether Musk will become the ultimate beneficiary of the token supply.

According to Doji, this isn’t possible.

“Functionally, Grok’s wallet holds the vested supply, and Grok is developed by xAI. However, it’s important to clarify that while Grok seeded the wallet through Cliza, the token itself operates independently on Base. There’s no direct ownership or management by Elon or xAI over the token or its community. It’s a decentralized memecoin with AI-driven origins,” Doji noted.

Instead, the tokens are destined for continuous accumulation.

“These wallets have never sold or transferred out tokens. They simply accumulate the vested and earned Byte allocations as per the Cliza deployment system. Since they are agent-generated, they lack the human-controlled signing authority to sell or move tokens.”

In an industry like meme coins, where scams like rug pulls and pump-and-dumps have become common currency, AI-generated tokens with capabilities similar to BYTE’s model could gain considerable traction down the line.