The financial world has just witnessed a huge shock when the group of 500 richest billionaires in the world lost a total of 108 billion USD in just one day, after the sell-off of technology stocks due to the influence of Chinese AI startup DeepSeek - SCMP reported.
AI billionaire takes the biggest punch
Leading the list of the most damaged people is Jensen Huang, co-founder of NVIDIA, when his assets evaporated $ 20.1 billion, down 20% in just one trading session on January 28. Oracle co-founder Larry Ellison also lost $ 22.6 billion, equivalent to 12% of his total assets.
Not only them, other technology billionaires were also heavily affected: Michael Dell (Dell Inc.) lost 13 billion USD; Changpeng "CZ" Zhao (former CEO of Binance) decreased 12.1 billion USD.
Tech billionaires collectively lost $94 billion, accounting for 85% of the decline in the Bloomberg Billionaires Index. Tech stocks plunged, pushing the Nasdaq Composite down 3.1% and the S&P 500 down 1.5%.
DeepSeek - "The Roadblock" from China
DeepSeek, an AI startup based in Hangzhou, China, has suddenly shocked the tech world when their DeepSeek R1 chatbot quickly climbed to the number one position on the global application rankings.
The platform attracted so many users that it crashed its servers and was forced to limit registrations to users with Chinese phone numbers. Remarkably, DeepSeek claims it spent just $5.6 million to develop the model—a pittance compared to the billions of dollars that American companies are spending to compete in the AI race.
The emergence of DeepSeek has shaken investors' confidence in the resource-intensive strategies of Western AI giants such as Meta, Alphabet, and Microsoft.
Silicon Valley's High Costs
Major US tech companies have spent hundreds of billions of dollars on AI development. Meta has just announced plans to spend between $60-65 billion this year on AI projects, while overall spending by the "Big Tech" group is expected to reach $200 billion by 2025.
Thanks to the AI boom, the fortunes of tech billionaires have increased sharply since 2023. Jensen Huang's fortune increased nearly eightfold, reaching $121 billion before losing $20.1 billion; Mark Zuckerberg (Meta): Up 385%, reaching $229 billion; Jeff Bezos (Amazon): Up 133%, reaching $254 billion.
While Jensen Huang and Larry Ellison suffered losses, Mark Zuckerberg and Jeff Bezos "escaped" as their assets not only did not decrease but also increased. Zuckerberg earned an additional 4.3 billion USD, while Bezos also "pocketed" 632 million USD.
DeepSeek - China's "trump card"?
What's remarkable is that DeepSeek was able to develop a powerful AI model without making huge investments in NVIDIA's high-end GPUs — the mainstay of the Western AI supply chain.
The reason is that China is under US export controls on high-end AI chips like the Nvidia H100, but according to Scale AI CEO Alexandr Wang, Chinese AI labs actually have “more H100s than people think.” He claims DeepSeek owns around 50,000 H100 GPUs, although they cannot disclose this because they violate US export bans.
The DeepSeek “storm” has raised doubts about the West’s money-burning AI strategy. If a Chinese company can develop AI with just $5.6 million, do you need billions of dollars to do the same? This event could be a turning point, forcing American tech giants to reconsider their investment strategies.
Meanwhile, global tycoons will certainly be keeping a close eye on DeepSeek, which cost them $108 billion overnight.
