Crypto Markets Rattled by Trump-Musk Showdown as $TRUMP Token Tanks, $1B in Liquidations Follow
Tensions flared in both politics and crypto markets Thursday as a public feud between Donald Trump and Elon Musk sent shockwaves through digital assets — igniting nearly $1 billion in crypto liquidations and triggering a sharp sell-off across the board.
Bitcoin briefly dipped below $101,000 before recovering above $101.5K. Altcoins fared worse: Ethereum dropped 4%, Solana and Dogecoin followed suit, and memecoins like $TRUMP saw steep declines, losing over 9.3% in value.
At the center of the drama: a highly publicized clash between Trump and Musk over the president’s proposed “Big, Beautiful Bill,” which Musk criticized for threatening national debt. The spat quickly escalated, with Musk threatening to halt SpaceX projects and Trump responding with pointed threats of federal contract cuts — injecting new uncertainty into already-fragile markets.
Data from CoinGlass showed a massive $988 million in liquidations, with $888 million from long positions alone.
Breakdown of liquidations:
- Bitcoin: $342M
- Ethereum: $286M
- Solana: $51M
- DOGE + XRP: $50M+ combined
Bybit saw the largest wipeouts, followed by Binance and OKX.
Meanwhile, the $TRUMP token cratered after a double blow: not just the Musk feud, but also an embarrassing branding crisis. A wallet associated with the token — launched in partnership with Magic Eden — went dark following a cease-and-desist from a competing Trump-themed crypto initiative. Trump’s sons distanced themselves, touting a separate DeFi venture.
Despite the chaos, some see this as a temporary flush. Funding rates dropped, leverage reset, and some institutional desks noted renewed spot buying at lower levels.
“It was a reset disguised as a headline-driven panic,” said one OTC trader. “Crypto needed an excuse to clear the decks — and this feud delivered it.”
With overleveraged longs wiped out and volatility rising, markets now wait to see whether Bitcoin’s resilience above $100K can hold — or if more fireworks are yet to come.
