Trump-Musk Clash Unleashes Chaos Across Crypto Markets, Nearly $1B in Longs Liquidated
A high-stakes public dispute between former President Donald Trump and tech magnate Elon Musk has triggered a cascade of selling pressure across crypto markets, wiping out nearly $1 billion in leveraged positions and unnerving investors already wary of political risk.
The feud, centered around Trump’s controversial “Big, Beautiful Bill” and its implications for federal spending, quickly turned personal. Musk responded with threats to pull back SpaceX cooperation with the U.S. government, while Trump hinted at reevaluating government contracts involving Musk-led firms. The conflict rattled markets, sending risk assets — particularly digital currencies — into a tailspin.
Key Impacts:
- Over $988 million in crypto liquidations in 24 hours
- $888 million of that total from long positions
- Top casualties:
- Bitcoin: $342M liquidated
- Ethereum: $286M
- Solana, Dogecoin, XRP: combined >$100M
Exchange Breakdown:
Bybit topped liquidation volume at $354M, followed by Binance and OKX.
The politically-themed memecoin $TRUMP was especially hard-hit, plunging over 9% after its newly launched wallet was abruptly taken offline following a cease-and-desist order from a rival Trump-affiliated crypto project. Public disassociation by Trump’s sons further eroded investor confidence.
Traders and analysts pointed to excessive leverage and low volatility conditions that left the market vulnerable to a sharp correction. Derivatives funding rates dropped, and on-chain metrics showed a spike in outflows from major exchanges, consistent with panic selling or portfolio deleveraging.
Despite the volatility, institutional sentiment toward Bitcoin remains robust. Corporate treasuries now hold more than 809,000 BTC — nearly double the figure from a year ago — supported by favorable accounting rules and regulatory clarity.
“This is less a fundamental reversal than a political tremor shaking an overleveraged market,” said a risk strategist at a Hong Kong digital asset firm. “Bitcoin’s long-term bid remains intact — but short-term positioning just got wiped.”
As Asia opens its trading day, all eyes remain on whether Bitcoin can maintain support above $100K and whether memecoins can recover from the latest bout of reputational damage.
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