Trump-Musk Feud Sends Tesla Stock Down 14% Bitcoin Drops 5%

On June 5, a public fallout between Donald Trump and Elon Musk sent shockwaves through financial markets, causing Tesla stock to plummet and dragging the crypto sector into a broad risk-off retreat. The rift came to a head during a White House meeting with the German chancellor, where Trump expressed his displeasure with Musk, who had been one of his closest advisers. Musk responded swiftly on X, accusing Trump of ingratitude and claiming that without his support, Trump would have lost the election. This exchange marked a dramatic unraveling of their once-powerful alliance, built during Trump’s second term.

Tensions escalated further when Musk replied “Yes” to a post on X calling for Trump’s impeachment. Although any such effort is considered politically impossible, the remark drew immediate attention. Markets quickly reflected the fallout, with Bitcoin dropping as low as $1100,500 on Thursday before recovering above $102,700. The broader crypto market fell nearly 5% during the same time. The $TRUMP meme coin, which had surged during the peak of their alliance, slid 10%. Analysts say Musk’s influence in the crypto space, combined with the political uncertainty, has introduced fresh instability into an already volatile market.

Tesla shares suffered a sharper decline, closing 14% lower on Thursday and falling 16% since Musk began attacking Trump’s domestic policy bill last week. The stock now trades roughly 33% below where it stood on Inauguration Day, showing growing fears that the feud could jeopardize billions in federal subsidies and contracts vital to Tesla’s long-term prospects. Musk had served as a key informal adviser to Trump, helping shape major policy decisions and frequently representing the administration abroad. His sudden departure from that inner circle has left a noticeable void in tech-policy alignment, with markets now unsure of how the administration will proceed on key issues such as electric vehicles and space infrastructure.

Adding to the uncertainty, Musk has hinted at launching a new political movement altogether. That possibility, along with the risk of a regulatory reversal or funding pullback, has left investors bracing for a more hostile environment. And that’s not just for Tesla, but for the broader tech and crypto sectors that have often moved in tandem with Musk’s influence. The clash has become more than a political sideshow. It is a rare case of personality-driven politics colliding with market fundamentals. For now, both crypto and Tesla appear firmly caught in the crossfire.