Answer can be found at TED speech by Terry Moore, executive director at the Radius Foundation.
When Arabic texts made their way to Spain in the 11th century, Europe wanted to translate this mathematical wisdom of the East into a written, Western language. Attempts to do so, however, proved to be problematic. As it turned out, Arabic sounds do not translate well into European patterns of speech, nor are there ample characters to represent these sounds. An Arabic word meaning the unknown thing, a word used throughout early mathematical proofs, contained the Arabic letter sheen. The problem was, Moore explains, there was no sh sound in the Spanish language. So, the language crafters borrowed the ka sound from the Greek letter χ or chi. Later, chi was replaced with the Latin X. And once the material was translated into Latin, it formed material for math textbooks that we continue to read today.
So why is the letter x the unknown?
Because you cant say sh in Spanish!