Financial cryptocurrency markets experience a dip following the disintegration of the friendship between Donald Trump and Elon Musk.
Crypto market capitalization plunged by approximately $170 billion, dipping to $3.26 trillion on June 5 — the lowest since May 8. The markets are now on the brink of collapsing further if ongoing support levels crumble, though early trading in Asia on Friday saw a slight recovery to $3.3 trillion.
This steep slide seems to stem from a heated exchange between U.S. President Donald Trump and tech mogul Elon Musk. Musk claimed that Trump's tariffs would trigger a recession in the second half of the year and accused Congress of bankrupting America. The verbal tug-of-war on social media platforms only intensified, with Musk announcing that SpaceX would decommission its Dragon spacecraft in response to Trump's comments on government contracts[1][2].
Musk has been heavily critical of Trump's "One Big Beautiful Bill" for over a week, referring to it as one of the worst bills ever presented to Congress[2]. Trump, in response, described Musk's rebuke as unnecessary, while hinting at personal attacks on Musk[1][2]. Musk later made alarming claims about Trump's involvement with the Epstein case, stating that the reason those files have not been released is due to the President's connections[2].
The tension started to ease somewhat late on Thursday, with Musk seeming open to reconciliation[2].
Nearly $1 billion in crypto liquidations have occurred over the past 24 hours, according to Coinglass. About 228,000 traders have been affected, with 90% of them holding Bitcoin long positions. Overall liquidations amounted to around $988 million[1]. Analysts had anticipated a leverage flushout due to recent record-breaking open interest on Bitcoin futures markets[1]. Bitcoin lost almost $5,000 in a few hours, reaching a 4-week low below $101,000 in late trading on Thursday. However, it managed a slight recovery, reaching $102,800 during Asian trading on Friday. Analyst CrypNuevo suggested that a quick bounce from this level was unlikely, and further consolidation might be expected unless the sell-off accelerates[1].
[1] Wall Street Journal
[2] Bloomberg
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The intensifying public conflict between Donald Trump and Elon Musk has dominated headlines, with both figures engaging in sharp criticism and personal allegations on media platforms and social networks. Musk's opposition to the Republican's "big, beautiful bill" on Capitol Hill set off the dispute. Musk has accused Trump of links to the Epstein case, further fueling tensions[2]. Trump, however, has downplayed Musk's criticism, expressing disappointment and indicating he is currently uninterested in dialogue[1][2].
Donald Trump appears more discouraged than furious, according to advisers, and has even considered discarding his Tesla vehicle as a symbolic gesture[1]. There appears to be no clear resolution to the dispute, but some impartial parties have urged mediation to quell the conflict[1].
Impact on the Cryptocurrency Market
Tensions between Trump and Musk have not significantly affected the cryptocurrency market as of now. While both figures have the potential to sway markets, especially Musk with his Bitcoin and Dogecoin endorsements, this particular spat revolves around personal and policy issues rather than cryptocurrencies[1][2]. Market analysts have not identified this dispute as a catalyst for current crypto price movements[1][2]. Neither Trump nor Musk has publicly addressed cryptocurrency policy or markets in relation to their disagreement[1][2].
- The ongoing disagreement between Elon Musk and US President Donald Trump, stemming from policy issues, has not significantly influenced the cryptocurrency market as of now.
- Analysts have not identified the dispute between Trump and Musk as a catalyst for current cryptocurrency price movements.
- Despite having the potential to sway markets, especially with his endorsements of Bitcoin and Dogecoin, this specific argument between Trump and Musk revolves around personal and policy issues, not cryptocurrencies.
- Neither Trump nor Musk has publicly addressed cryptocurrency policy or markets in relation to their disagreement.
