It only took six months for Larry Chen to lose his billionaire status. The Chinese businessman, who was formerly among the world's richest with a net worth of $10.2 billion, took a financial hit as China began cracking down on private education. His company Gaotu Techedu Inc., which provides an online tutoring service, plummeted by almost two-thirds in the New York Stock Exchange (NYSE), making it now worth just $336 million according to Bloomberg's Billionaires Index.

China has implemented new regulations that prohibit companies like Chen's to make profits, raise capital, or go public. The move is in line with growing criticism for the country's private education sector—many of China's for-profit educational businesses operate on excessive workloads and prohibitive expenses that make it difficult for Chinese families to rely on their services.

Under the new regulations, online tutoring services will no longer be approved to teach China's school syllabus and those who wish to do so will need to apply for licenses and undergo review. In fact, some citizens have even claimed that the high cost of education is the main reason why they are not having more children. Such is counterproductive to China's recent authorization of three kids per family for this year, which was rolled out in order to boost the country's numbers amid an ongoing population decline.

"The after-school tutoring industry has been severely hijacked by capital," said the Ministry of Education in a recent statement. "[This] runs against the nature of education as welfare, and harms the normal education ecosystem."

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The recent changes have added to Gaotu's mounting financial struggles—since late January of this year, the company has lost over $15 billion due to poor stock performance. Despite these setbacks, Chen said on Weibo, a Chinese version of Twitter, that Gaotu "will comply with the regulations and fulfill social responsibilities."

Some of Chen's contemporaries have also taken the blow from China's latest updates. Zhang Bangxin, the CEO of TAL Education Group, experienced a $2.5 billion drop in wealth after his company's shares tanked 71 percent in the NYSE. Luckily for him, the drop wasn't substantial enough to lose his billionaire status, and he is still worth $1.4 billion today.

On the other hand, Yu Minhong, the chairman of New Oriental Education & Technology Group Inc., lost his billionaire status as Chen did after losing $685 million from a 54 percent drop. His company is now only worth $579 million after the substantial losses.

Like Gaotu, TAL and New Oriental have also pledged to abide by the new regulations as well as seek government assistance.