Massive $800M Liquidation Hits Bitcoin, Ether Bulls Following Trump-Musk Drama

Crypto Market Hit by Nearly $1B in Liquidations as Trump-Musk Clash Spurs Volatility

Digital asset markets were rocked Thursday following an escalating feud between former U.S. President Donald Trump and Elon Musk, resulting in nearly $1 billion in liquidations, primarily across long positions.

The turbulence underscores how political narratives can abruptly shift market sentiment, particularly in a highly leveraged environment.

According to CoinGlass data, $988 million in leveraged positions were wiped out over a 24-hour span, with Bitcoin (BTC) and Ethereum (ETH) leading the liquidation totals. The bulk of the damage came from:

BTC: $342 million
ETH: $286 million
SOL, DOGE, and XRP: Collectively over $100 million

The CoinDesk 20 Index dropped over 5%, underperforming broader risk assets as crypto traders responded swiftly to rising political risk premiums.

Musk and Trump exchanged barbed statements online, with Trump questioning federal ties to Musk’s companies and Musk responding with thinly veiled threats to withdraw SpaceX cooperation. The confrontation appeared to accelerate profit-taking and risk reduction across crypto.

Market makers noted a dramatic increase in forced closures on Bybit and Binance, signaling deleveraging from both retail and institutional participants.

“The market was technically coiled — it only needed a spark,” said a senior crypto strategist at a Singapore-based hedge fund. “That spark was geopolitical uncertainty repackaged as digital asset risk.”

While the broader outlook for BTC remains positive — with continued accumulation by corporate treasuries and ETF inflows — short-term volatility may persist as market participants recalibrate risk in light of unpredictable macro-political crosswinds.