Elon Musk, the maverick boss of Tesla, is no longer the world’s richest person after shares within the electrical automotive company dropped 8.6% on Monday, wiping $15.2bn (£10.8bn) off his fortune.
Musk, who final month leapfrogged Amazon founder Jeff Bezos to take the title of the world’s wealthiest person, dropped again into second place with a $183bn estimated fortune behind Bezos’ $186.3bn.
The 8.5% drop in Tesla’s share worth on Monday – the sharpest sooner or later fall since September – was partly fuelled by Musk tweeting that the costs of bitcoin and different cryptocurrencies “do seem high”. Telsa’s shares had been down one other 6% in pre-market buying and selling on Tuesday.
His feedback got here simply two weeks after Tesla purchased $1.5bn of bitcoin, which despatched the value of the cryptocurrency to recent highs. Bitcoin, which reched a excessive of $58,000 on Sunday, has since fallen to $47,500 on Tuesday morning. The worth remains to be up greater than 500% over the previous year.
Replying on Twitter to Peter Schiff, a stockbroker and gold investor, Musk said: “Money is just data that allows us to avoid the inconvenience of barter. That data, like all data, is subject to latency and error. The system will evolve to that which minimises both. That said, bitcoin and ethereum [another cryptocurrency] do seem high.”
Scottish Mortgage Investment Trust, which is managed by Tesla shareholder Baillie Gifford, was the most important faller on the FTSE 100 on Tuesday, down 11%. Baillie Gifford was the most important faller on the FTSE 250, down 8%.
Musk had final week mentioned Tesla’s determination to purchase $1.5bn in bitcoin was a company determination not pushed by him. “Tesla’s action is not directly reflective of my opinion,” Musk mentioned, once more on Twitter.
“Having some bitcoin, which is simply a less dumb form of liquidity than cash, is adventurous enough for an S&P 500 company … When fiat [government-issued] currency has negative real interest, only a fool wouldn’t look elsewhere. Bitcoin is almost as bs [bullshit] as fiat money. The key word is ‘almost.’”
Tesla disclosed the bitcoin holding in a filing with the US Securities and Exchange Commission final month. The company mentioned that it had “updated our investment policy to provide us with more flexibility to further diversify and maximise returns” to permit it to speculate money reserve in “alternative reserve assets including digital assets”.
It mentioned that for the reason that determination was accepted by its audit committee it had “invested an aggregate $1.5bn in bitcoin under this policy and may acquire and hold digital assets from time to time or long term”.
Musk has beforehand helped to drive the recognition of cryptocurrencies, together with bitcoin and dogecoin, by often tweeting that he’s a “supporter” of the cryptocurrencies. He has additionally joked that bitcoin is his “safeword”.
Last month the value of bitcoin soared after Musk mentioned that he was a supporter of the cryptocurrency in an interview carried on Clubhouse, a brand new social media app designed for rich individuals. “I do think at this point bitcoin is a good thing,” he mentioned. “And, so, I am a supporter of bitcoin. Like I said, I was late to the party, but I am a supporter of bitcoin. And I think, bitcoin is really on the verge of getting broad acceptance by conventional finance people.”
He has beforehand modified his Twitter biography to “#bitcoin”.
Musk additionally tweeted on Monday that Tesla’s Model Y Standard Range SUV would nonetheless be accessible “off the menu”, following experiences from electrical automobile newsite Electrek that the mannequin had been eliminated as an possibility on-line.