The billionaire Tesla CEO, Elon Musk has lost his title of the world’s richest person. As the shares of electric car manufacturing company have recently experienced a decline which is the main source of Musk’s income.
As per the statistics report, the shares of the company have been plummeted more than 20% since the fortunate hitting a high of more than $880 in early January.
The reason behind the slacking of the shares is considered as the risky investment of $1.5 billion, Tesla made in Bitcoin. Therefore, the former richest man, Jeff Bezos of Amazon has again gained the title of the richest man in the world.
Moreover, in a statement, the Wedbush Securities analyst Dan Ives stated that the associated risk factor with the famous Bitcoin has prompted some of the Tesla investors to cash out their shares. However, no major loss has been suffered by the company.
“By Musk and Tesla aggressively embracing Bitcoin… investors are starting to tie Bitcoin and Tesla at the hip,” he further said.
“The recent 48-hour sell-off in Bitcoin and added volatility has driven some investors to the exits on this name in the near-term.”
“I would be surprised if anyone was surprised that they came up short,” said Sam Korus, an analyst at Ark Investment Management in New York, which holds Tesla shares. “When Musk gives a prediction, you know it’s an extraordinarily ambitious goal.”
In a conversation on Twitter, Elon Musk replied to Peter Schiff, a stockbroker, and gold investor, as 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 minimizes both. That said, bitcoin and Ethereum [another cryptocurrency] do seem high.”
Bitcoin’s value surged almost 50% in the weeks after Tesla announced it had acquired $1.5bn of the currency and intended to accept it as payment.
Although since escalating above $57,000 on Sunday, the cryptocurrency has sunk nearly 20%. It was trading at less than $48,000 on Tuesday – nevertheless higher than when Tesla uncovered its bet.
Source: BBC News