In a dramatic turn of events, a late-night Twitter clash between former President Donald Trump and tech mogul Elon Musk has thrown global markets into disarray, causing major cryptocurrencies to nosedive. Overnight, Bitcoin skidded below the $101,000 mark, taking with it a cascade of nearly $1 billion in leveraged bets. The tumult has left a mark on the broader crypto landscape, with the CoinDesk 20 Index dropping over 5%.
Ripple Effects of a Twitter Spat
The fallout from the Trump-Musk skirmish has been swift and severe. Data from CoinGlass reveals that traders were caught off guard, losing a staggering $988 million in liquidations. Of this, a significant $888 million came from long positions, signaling a dramatic wipeout of bullish bets. Exchanges like Bybit and Binance bore the brunt, with Bybit accounting for nearly $354 million in liquidations alone.
Bitcoin, the leading cryptocurrency, saw over $342 million liquidated in the past 24 hours, a testament to the scale of the market shake-up. Ether trailed closely with $286 million in liquidations. Solana’s SOL and Dogecoin weren’t spared, with $51 million and $27 million vanishing, respectively, as altcoin traders found themselves on the losing end of the sudden downturn. Even XRP wasn’t immune, with $23 million wiped out. As explored in our recent coverage of Dogecoin’s resilience amid Musk’s controversies, the memecoin has shown an ability to weather similar storms in the past.
“These liquidations are indicative of a market under duress,” explained crypto analyst Jane Thompson. “When such large amounts are liquidated in a short timeframe, it underscores how leveraged and precarious bullish positions had become.”
The Underlying Causes and Consequences
The sell-off was exacerbated by Trump’s threats to terminate government contracts with Musk’s companies, a move that Musk countered by linking Trump to controversial figures. Such high-profile clashes have the potential to unsettle markets by injecting uncertainty into investor sentiment. This follows a pattern of market reactions to political developments, as detailed in our analysis of Bitcoin’s response to tariff deal progress.
In recent weeks, crypto markets had been riding a bullish wave, buoyed by positive sentiment and increasing institutional interest. However, the Trump-Musk spat has sparked a bout of profit-taking, sending shockwaves through what was a stable trend.
Market extremes, as seen in this scenario, often precipitate a cascade of liquidations. “When prices swing violently, it often catches over-leveraged traders off guard,” noted financial strategist Mark Yates. “They find themselves unable to meet margin requirements, leading to a forced closure of positions.”
What Lies Ahead for Crypto?
As we look toward the remainder of June 2025, the question remains whether this downturn is a temporary blip or the beginning of a more prolonged correction. With such significant liquidations, the market might be poised for a price reversal as sentiment begins to stabilize.
The volatility has also reignited discussions about the risks associated with high-leverage positions, particularly in the realm of memecoins like 1000PEPE, which contributed to the market’s turbulence. Traders rushed to exit these high-risk plays, adding fuel to the fire.
For now, the crypto community is watching closely. The Trump-Musk showdown—though sensational—highlights the fragility of markets subject to external shocks. As traders recalibrate their strategies, the focus will be on navigating the uncertainties that lie ahead.
In this whirlwind of events, one thing is clear: unpredictability remains a hallmark of the cryptocurrency market. Investors and traders alike must brace for volatility, as the landscape evolves in response to both internal dynamics and external influences. The road ahead is uncertain, raising questions about whether the crypto rally can regain its momentum.
Source
This article is based on: Bitcoin, Ether Bulls Hit With $800M Liquidation as Trump-Musk Tussle Rattles BTC, ETH
Further Reading
Deepen your understanding with these related articles:
- Crypto Daybook Americas: Robinhood Earnings to Preview Trump’s ‘Damage’
- Trump’s Crypto Sherpa Bo Hines Says Crypto Legislation on Target for Quick Completion
- Truth Social Explores Cryptocurrency Launch for Subscription Payments (openai)
Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
