I think he's scared for his own safety. In fact he has basically said as much. As rich as he is, he still owes a lot of money and favors to a lot of people. Some of them are quite powerful and ruthless. They're likely displeased at how he's pissing away the value of an asset in which they have an interest. Just because he's paranoid doesn't mean people aren't out to get him. If I had the kinds of friends or enemies that he has, and particularly if I had been busy converting the first into the second, I'd be worried too.
It seems more likely if you are rich or powerful, you have much better alternatives available.
Those numbers are swelling steadily. And with every sale that Musk does he is adding to that pile. You have to wonder what makes him believe that Tesla stock is overvalued.
When you're in a persistent fear state, rational decisions become almost impossible and actions directly contrary to one's own interest become commonplace. It's like the skier who's trying to avoid a rock, but keeps staring at it and naturally starts turning toward it instead. Sometimes it's better to look away, even literally, toward the path you should take instead. Unfortunately for us all, Musk so far seems unable to do that.