Crypto markets weren’t ready for this level of political drama. A heated exchange between U.S. President Donald Trump and Tesla CEO Elon Musk appear to have rattled investor sentiment, dragging Bitcoin down to just above $100,000.
BTC briefly touched $100,984 on June 5 before stabilizing, just a few dollars shy of dipping below a key psychological threshold.
The broader market followed suit, with the total crypto market cap shedding around $70 billion in a 24-hour window.
Political fallout spills into crypto markets
The drop in crypto prices coincided with a public feud between Trump and Musk that played out across Truth Social and X.
It started with Musk’s June 3 critique of Trump’s new tax and spending package, referred to as the “big, beautiful bill,” calling it a “disgusting abomination” over its effect on the federal deficit.
Trump fired back, accusing Musk of being upset about the removal of electric vehicle tax credits.From there, things escalated quickly.
Musk claimed Trump would’ve lost the 2024 election without his support, while Trump hinted at canceling SpaceX and Tesla’s federal contracts.
Allegations even touched on Trump’s name being in Epstein case files, which Musk referenced publicly. This marked a clear breakdown of what was once a political alliance, and markets appeared to react in real-time.
$981M in crypto liquidations, longs take the hardest hit
The fallout wasn’t just in price charts, it showed up on trader dashboards too. According to Coinglass, over 222,000 traders were liquidated in the past 24 hours, totaling $981 million.
Bitcoin accounted for $344 million in liquidations, with $305 million coming from long positions alone. Ethereum followed closely with $285 million wiped, primarily from long traders.
Polymarket couldn’t resist joining the chaos, launching bets on whether Trump would apologize to Musk, or whether Jesus Christ would return in 2025. The latter was leading at the time in the bet.
Even memecoin platform Pump.fun chimed in, suggesting Musk should respond with a coin of his own.
As the dust settles, it’s clear that in today’s market, politics and price action are more intertwined than ever, especially when billionaires are involved.
