World’s Richest People Lose $108 Billion After AI Selloff

The world’s 500 richest people lost a staggering $108 billion on Monday as a tech-led selloff rocked global markets. The selloff was triggered by the sudden rise of Chinese AI developer DeepSeek, whose app DeepSeek R1 disrupted the industry.

Tech Billionaires Suffer the Most

The tech sector took the hardest hit, with billionaires tied to artificial intelligence losing a combined $94 billion.

• Jensen Huang, co-founder of Nvidia, saw his fortune drop $20.1 billion (20%).
• Larry Ellison of Oracle lost $22.6 billion, the largest loss in absolute terms, though it was only 12% of his net worth.
• Michael Dell lost $13 billion, while Changpeng Zhao of Binance lost $12.1 billion.

Despite these losses, some billionaires, like Meta’s Mark Zuckerberg and Amazon’s Jeff Bezos, saw their fortunes rise slightly due to rebounds in their stock prices.

What Sparked the Selloff?

DeepSeek’s new app, DeepSeek R1, became the most downloaded chatbot app worldwide over the weekend. The app’s success highlighted its ability to rival AI giants like OpenAI and Anthropic, despite its low development cost of just $5.6 million.

DeepSeek’s rise shook investor confidence in Silicon Valley’s AI model, which relies heavily on massive capital spending and advanced semiconductors. This shift caused a sharp selloff in tech stocks:

• The Nasdaq Composite Index dropped 3.1%.
• The S&P 500 fell 1.5%.

Impact on Silicon Valley’s AI Narrative

DeepSeek’s success challenges Silicon Valley’s belief that AI breakthroughs require huge investments and access to cutting-edge technology.

• Meta, Alphabet, and Microsoft have spent billions on AI, including hoarding top-tier semiconductors like Nvidia’s H100 chips.
• DeepSeek, operating with fewer resources, has shown that high-performance AI systems can be developed at a fraction of the cost.

Experts like Alexandr Wang, CEO of Scale AI, suggest that Chinese firms like DeepSeek may have access to more advanced GPUs than previously thought, despite U.S. export restrictions.

The Bigger Picture

This selloff underscores a shift in the AI landscape, with new competitors like DeepSeek challenging Silicon Valley’s dominance.

The rapid rise of low-cost AI alternatives could reshape the tech industry, but it has already caused major financial losses for the world’s wealthiest individuals.

Key Takeaways:

• $108 billion was wiped from the wealth of the world’s richest people, with tech billionaires losing 85% of the total.
• DeepSeek, a Chinese AI developer, triggered the selloff with its low-cost, high-performing AI app.
• The Nasdaq and S&P 500 saw significant drops as investors questioned Silicon Valley’s heavy spending on AI.
• Billionaires like Jensen Huang and Larry Ellison took the largest hits, while others like Mark Zuckerberg gained slightly.

As AI continues to evolve, the rise of competitors like DeepSeek signals a major shift in the global tech race.