Tensions between President Donald Trump and Elon Musk have roiled the crypto markets, triggering a sharp sell-off that wiped out over $980 million in leveraged positions within 24 hours.
Bitcoin, which briefly rallied to $105,915, dropped nearly 5% to $100,500 before recovering to around $103,000 at press time, according to CoinMarketCap. The downturn caught many leveraged traders off guard, with CoinGlass reporting $980.9 million in long liquidations during the turbulence.
The sell-off coincided with an escalating political feud. Musk publicly criticized Trump’s proposed global tariffs, warning they could “cause a recession in the second half of this year.” Trump retaliated on Truth Social, threatening to revoke SpaceX’s government contracts to “save billions,” prompting Musk to temporarily announce—then retract—plans to decommission the company’s Dragon spacecraft.
The timing couldn’t have been worse for Bitcoin. Long-term holders, many of whom accumulated BTC over 155 days ago, began selling into strength, further intensifying the pressure. Analysts at Swyftx cautioned that unless policymakers see “hard data” showing the economic toll of Trump’s tariff plan, the U.S. could delay any monetary easing—adding more drag on crypto and other risk assets.
Bitcoin now hovers precariously above the $100,000 psychological level, a key battleground where bullish momentum faces off against deepening political headwinds.
Overleveraged Bulls Trigger $300M Bitcoin Shakeout
The recent plunge laid bare the fragility of an overextended crypto market, with nearly $1 billion in liquidations cascading across major tokens. Although CoinGlass pegged total liquidations at $980 million, some analysts believe the real figure could be even higher.
Vincent Liu, CIO at Kronos Research, described the moment as a “perfect storm” driven by overlapping macro threats and market mechanics.
“The Trump-Musk feud, tariff-induced recession fears, and excessive leverage created ideal conditions for a fast, automated sell-off,” Liu said.
The structural nature of crypto—where margin calls and forced liquidations are executed automatically—amplified what began as a sentiment-driven dip into a rapid unwinding of bullish bets.
Of the $980 million reported, a staggering $876 million came from long positions. Bitcoin traders absorbed the largest blow, with $341 million in BTC longs liquidated. Ether followed with $285 million, while altcoins like Solana, XRP, and Dogecoin also saw heavy losses as panic spread across the market.
According to Liu, excessive optimism was partly to blame. Bitcoin’s recent climb past $111,000 had fueled a bullish frenzy, with many traders betting on $105,000 as a new floor. The abrupt reversal shattered those assumptions, turning euphoria into cascading liquidations.
All Eyes on CPI and Jobs Data After Crypto Rout
As markets digest the liquidation shock, investor attention is now turning to key economic data that could dictate the next phase of price action. According to Liu, Friday’s U.S. employment report and next week’s June 11 Consumer Price Index (CPI) release are major catalysts to watch.
Beyond domestic indicators, Liu also flagged global macro trends—particularly Trump’s renewed push for sweeping tariffs against China—as critical market drivers. Strength in the U.S. dollar and institutional liquidity flows are also key metrics that could shape short-term sentiment.
“The market is still on edge after this week’s mass liquidations,” Liu added.
“Overleveraged positions continue to inject instability, and any macro surprise could easily spark another sharp move.”
With sentiment on a knife’s edge, the crypto market enters a volatile stretch, where data—not memes—will determine direction.
Quick Facts
- Trump-Musk tariff clash triggered over $980M in crypto liquidations
- Bitcoin dropped from $105,915 to $100,500 before partial recovery
- $341M in BTC longs and $285M in ETH longs were wiped out
- Musk warned tariffs could cause a recession; Trump threatened SpaceX
- CPI data on June 11 is expected to be the next key market trigger
