Tesla's stock collapsed on Tuesday as investors continue to grow fearful of the implications that the company's CEO, Elon Musk, caused after the world's richest man bought social media giant Twitter.
The sudden drop in share price left many people wondering, is Musk still the richest person on the planet? To answer the question, yes, the billionaire entrepreneur still holds his place at the top of wealthy individuals despite losing roughly $29 billion on his estimated net worth.
Tesla Stocks Drop
The electric vehicle company's shares fell by as much as 11% on Tuesday to $890, pushing the stock down more than 28% from its all-time high observed in November. The situation removed a massive amount of the Tesla CEO's fortune and $114 billion from the company's market capitalization, pushing it down to $920 billion.
An analyst, Edward Moya, wrote in emailed comments that Tesla shareholders are not happy that Musk will have to divert even more attention away from winning the electric-vehicle race. The remarks echoed concerns from Vital Knowledge Media's Adam Crisafulli, who attributed the downtrend of Tesla's stocks to the purchase of Twitter, as per Forbes.
Musk previously announced that he was planning to buy Twitter using $21 billion from his own wealth and that he had help from banks that would finance the other half. The question now is how the Tesla CEO will come up with the money he promised. This could come via selling some of the shares he owns from the electric vehicle company, borrowing against them, bringing in additional investors, or a combination of the three.
Furthermore, many people are concerned about whether or not Twitter would bring him into conflict over free speech with the government in China. The Asian nation is a key market for Tesla, where it has significant production operations.
According to NPR, the billionaire entrepreneur is already associated with Tesla and SpaceX and has other business ventures, including Neuralink, which develops brain implant technology, and The Boring Company, which makes tunnels.
Twitter's Future
Musk made his offer to buy Twitter for $44 billion with the stated aim of turning the social media platform into a haven for "free speech." However, the platform has already gone down that road, and it did not end in success.
Roughly a decade ago, one Twitter executive dubbed the company "the free speech wing of the free-speech party" to underscore its commitment to untrammeled freedom of expression. Subsequent events tested that perspective as repressive regimes cracked down on Twitter users, particularly after the short-lived "Arab Spring" demonstrations.
In the United States, a visceral 2014 article written by journalist Amanda Hess exposed the incessant, vile harassment that many women faced just for posting on social media platforms or other online forums.
In the following years, Twitter grew to adapt to the ever-changing environment and learned the consequences of running a largely unmoderated social platform. One of the most crucial reasons is that companies typically do not want ads running against violent threats, hate speech that bleeds into incitement, and misinformation that aims to tip elections or undermine public health. This leaves the question of what Musk could do to alleviate these problems in the future, the Associated Press reported.
Related Article: Elon Musk Takes $46.5 Billion Step to Buy Twitter: What's Next for World's Richest Man?
