Tesla boss Elon Musk is no longer world's richest person as share prices in car company drop

February 24, 2021

Tesla boss Elon Musk is no longer the world's richest person after shares in the electric car company fell by 8.6% this week, leaving him $15.2bn (£10.7bn) worse off.

The 49-year-old business magnate has now fallen to second place on the Bloomberg Billionaires Index of the world's 500 richest people with a net worth of $183.4bn (£129bn) - a significant drop from a peak of $210bn (£148bn) in January.

Amazon founder Jeff Bezos reclaimed the top spot, despite his own fortune dipping by $3.7bn (£2.6bn) to $186.3bn (£131bn) on Monday.

The two have been head-to-head since the beginning of the year, with Musk briefly overtaking Bezos after his rocket company SpaceX raised $850m (£599m) earlier this month, with the company being valued at $74bn (£52bn).

The drop in Tesla's share price on Monday was partly fuelled by Musk's comments over the weekend that the prices of Bitcoin and rival Ether "do seem high".

On Tuesday, Tesla's shares were down a further 6% in pre-market trading.

His comments came just two weeks after the company bought $1.5bn of Bitcoin, which sent the price of the cryptocurrency to new highs.

Bitcoin fell from a peak of $58,354 (£41,158) on Sunday to a low of $45,000 (£31,739) on Tuesday - and the price is still up more than 500% over the past year.

A German-based trader said he was "taking chips off the table" on Tesla as its $1.5bn (£1.06bn) investment in the cryptocurrency could "backfire now".

Musk also tweeted on Monday that the company's Model Y Standard Range SUV would still be available "off the menu", confirming reports that the model had been removed from its online configurator.

Last week, Musk claimed he was not behind Tesla's decision to buy $1.5bn in Bitcoin, and that it was a company business move.

"Tesla's action is not directly reflective of my opinion," he tweeted.

He added: "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 as fiat money. The key word is 'almost'."

Valentijn van Nieuwenhuijzen, chief investment officer at asset manager NN IP, told Reuters that Musk's decision to invest in Bitcoin could weigh on Tesla's ESG rating.

Musk has been criticised for lauding Bitcoin prior to Tesla's purchase of the cryptocurrency.

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