The former bestie’s feud over a controversial spending bill is roiling crypto markets, tanking Tesla stock, and shaking investor confidence across the board.
Bitcoin (BTC) and other digital assets have dipped as a public feud between Donald Trump, the President of the United States, and Elon Musk, the world’s richest man, escalates and threatens to fracture the country.
Relationship publicly sours over big beautiful bill
On Thursday, Musk openly criticized Trump’s flagship “One Big, Beautiful Bill Act,” a tax-and-spending package expected to add $2.4 trillion to the deficit.
“I’m sorry, but I just can’t stand it anymore,” Musk wrote on his social media platform X. “This massive, outrageous, pork-filled Congressional spending bill is a disgusting abomination. Shame on those who voted for it: you know you did wrong. You know it.”
Trump tapped Musk to co-lead a newly formed Department of Government Efficiency (DOGE). DOGE was created to cut bloated US Federal Government spending practices, and Musk takes issue with aspects of the bill, which include large spending increases on infrastructure, border security, family tax credits, and various industrial subsidies.
Musk also wrote on X that the Bill would “increase the already gigantic budget deficit to $2.5 trillion (!!!)”
The bill includes provisions to reduce or eliminate EV tax incentives, including credits that benefit Tesla buyers. There are reports that this has been a factor in Musk’s attack on the bill.
Trump and Musk exchange jabs
On June 5, Trump hit back. At a press conference and on Truth Social, he threatened to cut government subsidies to Musk’s companies, writing: “The easiest way to save money… is to terminate Elon’s Governmental Subsidies and Contracts.” This was a direct shot at SpaceX, Tesla, and other Musk-linked ventures heavily dependent on federal contracts.
Musk responded in kind. On X, he taunted Trump: “Go ahead, make my day.” He then escalated the feud further, tweeting that Trump was “in the Epstein files,” implying—without evidence—that Trump’s name appears in sealed Jeffrey Epstein documents.
By Thursday evening, the situation had spiraled. Musk implied SpaceX would decommission its Dragon spacecraft program in protest, while Trump reportedly considered removing Musk from his DOGE advisory role. Musk even liked posts calling for Trump’s impeachment.
Crypto Market Reaction: Sharp Sell-Off
The feud triggered a sharp downturn in the crypto markets. Bitcoin, which had hovered above US$105,000 earlier in the week, dropped to as low as ~US$100,500 on Thursday. Traders moved defensively as the fallout of the battle between two of the most powerful continues to unfold. There is clear uncertainty being generated by the public spat.
Higher-risk assets are being sold, with portfolios being shifted towards havens like gold, which is up ~0.6% in the last 24 hours.
BTC bulls will be pleased to observe that the asset has shown an ability to become more resistant to global macro barriers. Bitcoin (BTC) has established new all-time-highs (ATHs) in 2025 despite bearish clouds like the Trump tariff war materializing. This year, it has often made swift comebacks after headline-driven sell-offs.
Dogecoin (DOGE), a Musk-linked asset, suffered the most. It plunged 10% on Thursday and is down ~22% for the week. The fallout from Musk’s apparent departure from DOGE, the symbolic government post, removed a key driver of Dogecoin’s speculative value.
In total, over $620 million in crypto long positions were liquidated across exchanges during a four-hour window, according to Coinglass.
The feud spilled into traditional markets, with Tesla stock plunging 14.3% on Thursday—its biggest single-day loss in over a year. Roughly $151 billion in Tesla market cap was erase
This feud isn’t just a spectacle. It’s a reminder of how central personalities have become to asset valuations in 2025. Whether the relationship can be repaired, or if the animosity deepens, will shape sentiment in crypto and broader markets in the weeks ahead.
