Collapse of the cryptocurrency market: Liquidations exceeding one billion dollars after the escalation of the dispute between Musk and Trump.
The intensity of the argument between Elon Musk and U.S. President Donald Trump escalated after Musk criticized the government spending bill supported by Trump, describing it as a disgusting violation increasing the financial deficit. Trump responded by threatening to cut government contracts and support for Musk's companies like Tesla and SpaceX, prompting Musk to announce a temporary halt of the Dragon spacecraft before later reversing his decision.
Direct market impacts:
- Bitcoin: Its price dropped by 4% to reach $100,500, with liquidations amounting to $342 million for long positions (expecting to rise).
- Ethereum: Led the collapse of alternative currencies with a loss of 7%, reaching a price of $2,400, with liquidations of $260 million in futures contracts.
- Other currencies:
- Dogecoin: Dropped by 8% due to its previous association with Musk's tweets.
- Solana, Ripple, and Binance Coin: Losses ranged between 4-6%.
Factors exacerbating the crisis:
1. Exit of Bitcoin ETF funds: Recorded $278 million in withdrawals, reflecting a decline in institutional confidence.
2. Expiration of futures contracts: The collapse coincided with the expiration date of futures contracts, increasing market volatility.
3. Side effects:
- Tesla's stock lost 14% of its value.
- The value of Trump Coin decreased by about 10%.#TrumpVsMusk