Political tension between Donald Trump and Elon Musk led to a wave of volatility in financial markets, particularly affecting the cryptocurrency sector, with the price of Bitcoin dropping below $101,000.
The confrontation began when Elon Musk publicly criticized a bill proposed by Trump, calling it a 'disgusting abomination' due to its impact on the financial deficit.
Donald Trump vs. Elon Musk: A Financial Impact Showdown
The legislative proposal, which has already been passed by the House of Representatives, was set to add between $2.4 trillion and $5 trillion to the national debt, according to estimates from the Congressional Budget Office.
In response, Trump threatened to cut support and cancel federal contracts that favor Musk's companies, such as Tesla and SpaceX. The situation escalated quickly when Musk indicated that the president was linked to Epstein case files, increasing political and media tensions.
This conflict created tension on Wall Street: Tesla's (TSLA) stock fell by 14%, while the S&P 500 index experienced slight declines. The uncertainty immediately extended to the cryptocurrency market, which saw over $867 million liquidated in just four hours, according to data from CoinGlass.
Bitcoin, the leading cryptocurrency, experienced a sharp correction, dropping from $105,733 to $100,900 in just a few hours as investors reacted to the conflict.
Bitcoin was not the only affected cryptocurrency. Alternative currencies like Ethereum, Solana, and XRP recorded losses exceeding 5%, while companies associated with the cryptocurrency ecosystem, such as Coinbase and major Bitcoin mining firms, reported significant price declines.
Analysts noted that this incident reflects Bitcoin's vulnerability to geopolitical events and political tensions in the United States. Although Bitcoin is considered a safe haven in times of crisis, its sensitivity to such conflicts shows that it is still far from being immune to systemic volatility.