Total crypto market capitalization declined by around $170 billion in a fall to $3.26 trillion on June 5, its lowest level since May 8, almost a month ago.

Markets are now poised for a further fall below longer-term levels if current support levels break down. However, the decline slowed during early trading in Asia on Friday morning, with a minor recovery to $3.3 trillion.

Donald vs Elon

The sharp decline appears to have been driven by a spat between US President Donald Trump and tech billionaire Elon Musk, who said the former’s tariffs “will cause a recession in the second half of this year,” and “Congress is spending America into bankruptcy!” on June 5.

As the war of words on each of their respective social media networks escalated, and the bromance collapsed, Musk also said:

“In light of the President’s statement about the cancellation of my government contracts, SpaceX will begin decommissioning its Dragon spacecraft immediately.”

In light of the President’s statement about cancellation of my government contracts, @SpaceX will begin decommissioning its Dragon spacecraft immediately pic.twitter.com/NG9sijjkgW

— Elon Musk (@elonmusk) June 5, 2025

For more than a week, Elon Musk has been trashing Trump’s signature piece of legislation, a spending bill called One Big Beautiful Bill.

“I don’t mind Elon turning against me, but he should have done so months ago. This is one of the Greatest Bills ever presented to Congress,” said Trump on Truth Social.

However, the clearly riled billionaire Tesla CEO didn’t stop there, stating on X that it was “time to drop the really big bomb: Donald Trump is in the Epstein files.”

“That is the real reason they have not been made public. Have a nice day, DJT!”

BREAKING: President Trump’s former White House Chief Strategist Steve Bannon calls for Elon Musk to be deported, per NY Times. https://t.co/Q82Pbhzppt

— The Kobeissi Letter (@KobeissiLetter) June 5, 2025

The pair started to cool off late on Thursday with Musk’s admissions that it may be time to reconcile.

$1B in Liquidations

There has been almost $1 billion in crypto liquidations over the last 24 hours, according to Coinglass. Around 228,000 traders were wrecked, almost 90% of them in BTC long positions, and the total liquidations were around $988 million, it noted.

However, analysts had predicted that a leverage flushout was overdue, with open interest on Bitcoin futures markets hitting all-time highs recently.

Bitcoin lost almost $5,000 in a matter of hours, falling to a 4-week low just below $101,000 in late trading on Thursday. However, it found support there and recovered marginally to reach $102,800 during Asian trading on Friday.

Analyst “CrypNuevo” said that a quick bounce from this level was unlikely and more consolidation could occur, unless the sell-off accelerates.

$BTC update:

Plan is playing out so far!

Let’s see if this psychological support ($100k) can hold.

A quick bounce is unlikely imo. I’d expect that, at best, a small consolidation in this area before any interesting move could be the case – unless if we break below it fast. https://t.co/iWql8N6SW7 pic.twitter.com/CIb1KpJt8i

— CrypNuevo (@CrypNuevo) June 5, 2025

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