World's richest people lose US$108 billion after DeepSeek selloff

financialpost.com:

The world’s 500 richest people, led by Nvidia Corp. co-founder Jensen Huang, lost a combined US$108 billion on Monday as a tech-led selloff tied to Chinese artificial intelligence developer DeepSeek sent major indices plunging.

Billionaires whose fortunes are linked to AI were the biggest losers: Huang saw his fortune fall US$20.1 billion, a 20 per cent drop, while Oracle Corp. co-founder Larry Ellison’s US$22.6 billion loss was larger in absolute terms, but represented just 12 per cent of his fortune, according to the Bloomberg Billionaires Index. Dell Inc.’s Michael Dell lost US$13 billion, and Binance Holdings Ltd. co-founder Changpeng “CZ” Zhao shaved US$12.1 billion.

Tech-sector titans as a group saw US$94 billion of wealth evaporate — roughly 85 per cent of the Bloomberg index’s total decline. The Nasdaq Composite Index fell 3.1 per cent, and the S&P 500 dropped 1.5 per cent.

Hangzhou-based DeepSeek has been developing AI models since 2023, but the company first came onto the radar of many Western investors this weekend as its free DeepSeek R1 chatbot app topped download charts worldwide. So many new users piled in that DeepSeek struggled to keep the app online, suffering outages and forcing it to restrict signups to users with Chinese phone numbers.

DeepSeek’s dark-horse entry into the AI race, which it says cost just US$5.6 million to develop, is a challenge to Silicon Valley’s narrative that massive capital spending is essential to developing the strongest models. That delivered a serious blow to billionaires whose fortunes are tied to the Western AI supply chain that’s been the equities market’s biggest driver over the past two years.

Soaring valuations for so-called AI hyperscalers — including Meta Platforms