The crypto market experienced a sharp drop at the close of the week amidst escalating differences between President Donald Trump and Elon Musk, which triggered $1 billion in daily liquidations. 

Most of the crypto heatmap on the 24-hour chart shows red, as per TradingView, with Dogecoin leading in daily losses after sliding by 20%. 

Bitcoin, Ethereum, Solana, and XRP lost between 2%- 8%, with crypto markets analyst, Ali Martinez, noting a bearish signal on the MVRV ratio, after it crossed below the 200-day SMA on Bitcoin’s technical chart.

At press time, the total crypto market cap is down from June 5’s $4.1 trillion to the current $3.23 trillion. The Crypto Fear & Greed Index also moved to the ‘fear’ area at 45 points, indicating how negatively the Trump-Musk fallout has affected markets.

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Source: Alternative.me

When Friends Become Foes: What’s Behind the Trump-Musk Clash?

The root of President Trump’s fallout with SpaceX founder Elon Musk is Musk’s resignation from DOGE (the Department of Government Efficiency) on May 29.

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Source: X

His 130-day mandate as a special U.S. employee came to a halt with an announcement on X, where he thanked the president for trusting him with the opportunity to cut down wasteful spending.

However, only later would his departure signal a series of political escalations ranging from Musk’s public criticism of President Trump’s latest spending bill, the Big Beautiful Bill, which he called Big and Ugly.

In retaliation, the president wrote on X that he was the one who asked Musk to leave after the White House took away Musk’s EV mandate to have everyone buy an electric vehicle. However, Musk refuted the claim, with President Trump later announcing that he would cut all of Musk’s governmental subsidies and contracts to help save money.

Dogecoin sheds 20% amidst $1 Billion Crypto Long Liquidations

Dogecoin suffered the most significant blow from the clash, losing 20% on the day, which can be explained by its fundamental sensitivity to Elon Musk’s actions. The meme coin did rally on Trump’s re-election to the White House and Musk’s appointment as head of DOGE. 

However, with his resignation, investment interest in cryptocurrency is waning. As per derivatives data on Coinglass, DOGE’s open interest is 6.57% down over the last 24 hours to $1.97 billion.

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Source: Coinglass

The overall crypto market has currently faced the largest long liquidation since February 25, with high-leverage long positions being completely wiped out.

Perhaps due to the increasing political rattles in the White House, Polymarkets saw an uptick to 12% for the likelihood of a Trump impeachment by the end of 2025.

To conclude, intense micro and macro activity across global markets suggests the ongoing crypto volatility could persist in the coming days. However, a majority of analysts on crypto Twitter are still optimistic about an upcoming altcoin season if Bitcoin dominance hits a peak around 70.

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