Musk Claps Back at Trump as Bitcoin Falls Below $105,000: Why Is the Crypto Market Plunging?

6/6/2025, 3:22:33 AM
On June 6, 2025, cryptocurrencies collectively fell, with Bitcoin dropping to around $100,400. The conflict between Musk and Trump escalated, triggering a crisis of market confidence and intensifying downward pressure.

Three major triggering factors for the fall of cryptocurrencies today

1. Political risk fermentation: The conflict between Musk and Trump ignites market unease.

On June 6, Musk explicitly stated that he would not fund Trump’s campaign in response to Trump’s remarks, asking in return, “How much do you want to fool me for?” This statement quickly made headlines across major news platforms, raising investors’ concerns about the future direction of crypto policies.

Currently, the crypto industry is experiencing a window of policy easing, with Bitcoin and Ethereum spot ETFs being approved one after another, and the regulatory environment has improved. However, the fierce confrontation between Musk and Trump is seen by the market as a potential risk signal: if Trump returns to power and changes his stance, the crypto market may face a new round of Plummet cycle.

2. Market expectations fell short, and funds chose to exit in the short term.


Image:https://www.gate.com/trade/BTC_USDT

Previously, the market generally expected Bitcoin to stabilize above $105,000 and challenge new highs. However, in the past 48 hours, BTC not only failed to maintain its upward momentum but also quickly fell below the critical support level of $102,000, reaching approximately $100,400, triggering a chain of stop-loss orders.

A large amount of medium and short-term funds have chosen to exit and observe. On-chain data shows that the activity of whale accounts has decreased, while the number of small transactions has significantly increased, indicating that market confidence is waning in the short term.

At the same time, the trading volume of stablecoins surged, with USDT and USDC experiencing a rebound in net inflows on-chain, further validating the increase in risk-averse behavior, as funds began to move away from risk assets.

3. ETF funding structure differentiation: ETH attracts capital, BTC is under pressure

Against the backdrop of weak performance in traditional markets, crypto ETFs have become a key indicator for observing market sentiment.

According to SoSoValue data, on June 4, the US Bitcoin spot ETF still recorded a net inflow of 10.91 million USD, mainly driven by individual institutions (such as BlackRock). However, other mainstream ETFs like Fidelity have seen net outflows for two consecutive days, indicating overall weak buying interest.

In contrast, the fund flow performance of Ethereum ETFs is more active. The BlackRock Ethereum ETF saw a net inflow of up to $73.18 million in a single day, becoming the focus of capital attention in the crypto market. This structural migration of “shifting from BTC to ETH” has intensified the short-term adjustment pressure on BTC.

Investor panic sentiment is rising, on-chain data is warning of risks.

The crypto analysis platform Santiment data shows that market FUD (fear, uncertainty, doubt) sentiment soared rapidly after Musk’s comments. Related keywords (such as “Trump,” “Musk,” “sell,” “down”) reached their highest popularity on social platforms in the past month.

In addition, the BTC long positions liquidation volume on platforms such as Binance and OKX has significantly increased, with a total liquidation amount exceeding 130 million dollars within 24 hours. Especially in the contract market, the volatility has been severe, dragging down the spot prices.

CryptoQuant’s on-chain data also indicates that miner wallets have shown concentrated outflows in the past 12 hours, which may suggest that some long-term holders are becoming cautious about the market trend.

Market Outlook: Short-term downside risks remain, but the long-term trend has not been disrupted.

Although political risks and capital flows may continue to put pressure on the market in the short term, the following major trends still support the mid-term growth of the encryption industry from a longer cycle perspective:

  • Bitcoin and Ethereum spot ETFs have officially launched and are gradually being incorporated into more mainstream investment portfolios.
  • The Federal Reserve is nearing the end of the interest rate hike cycle and may consider monetary policy easing in the future.
  • Technological innovation and the continuous advancement in areas such as Layer2 expansion and AI integration are providing new growth momentum for the market.

If the market establishes solid support around 100,000 dollars, a rebound is still possible. However, at this stage, it is advisable for investors to remain cautious, control leverage, and pay attention to on-chain fund trends and political dynamics.

Conclusion

The recent fall in the crypto market was not triggered by a single piece of news, but rather by a combination of multiple factors: the public dispute between Musk and Trump igniting policy concerns, structural shifts in ETF fund flows, and the loss of technical support triggering a panic chain reaction.

For investors wanting to understand “Why Is Crypto Down Today”, only a comprehensive analysis of political, financial, emotional, and technical factors can provide a more thorough understanding of market trends, thereby allowing for rational judgment.

Author: Max
* The information is not intended to be and does not constitute financial advice or any other recommendation of any sort offered or endorsed by Gate.
* This article may not be reproduced, transmitted or copied without referencing Gate. Contravention is an infringement of Copyright Act and may be subject to legal action.

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