The U.S. stock market is overturned, Bitcoin plummets, and Musk and Trump "curse" out a financial tsunami?

Author: Fairy, ChainCatcher

Editor: TB, ChainCatcher

Note: The content of this article is organized based on the disputes between Musk and Trump, not in strict chronological order.

Musk initially wanted to be America's "Yang Jingshui," but found himself to be "Gao Hanwen."

Last night, Trump and Musk clashed head-on on social media, marking a complete break between former allies. Musk even dug up old tweets from Trump dating back 12 years as "weapons," with both sides exchanging sharp words that hit the nail on the head.

By the time the sun rose, the market was in turmoil: Tesla's market value evaporated by $153 billion, setting a record for the largest single-day drop in history. Bitcoin fell by 4%, and Dogecoin plummeted by 10%. The highly leveraged James Wynn continued to face liquidation, with current losses amounting to approximately $29 million.

Musk's Entry and Exit from the Administration

The honeymoon between the two began with the 2024 election, where Musk invested $290 million to support Trump, even personally visiting swing states to rally votes and create momentum. After Trump's victory, he appointed Musk as the head of the "Department of Government Efficiency" (DOGE), authorizing him to reform federal agencies and cut fiscal spending. At that moment, Musk seemed to truly become America's "Yang Jingshui."

However, the sweet coating of power quickly melted away. In April 2025, Musk had a severe disagreement with White House Chief of Staff Bessent over tariff policies, resulting in a heated argument at the White House gates that nearly turned physical. Ultimately, Trump adopted Bessent's appointment proposal, perhaps marking the first alarm of the rift between Musk and Trump.

A month later, Musk announced he would be leaving the Trump administration and would no longer serve as a special government employee, while the DOGE team would continue to work across the government. The seeds of their dispute seemed to have been sown here.

A Bill Ignites Conflict

In May 2025, the Republican-controlled House of Representatives passed a tax and spending bill that Trump called "big and beautiful." The bill was expected to cause the U.S. budget deficit to soar to $2.5 trillion, while prematurely terminating tax credits of up to $7,500 for several electric vehicles, including Tesla, which were originally set to be eliminated in 2032 but were cut seven years early. JPMorgan analysts estimated that this move would cause Tesla's annual profits to evaporate by about $1.2 billion.

On June 4, Musk publicly opposed the bill, calling it "disgusting," and began privately lobbying Republican lawmakers to try to prevent the president from signing it. He also directly wrote to House Speaker Mike Johnson, urging the retention of electric vehicle subsidy provisions.

The first round of insults erupted.

Trump expressed "disappointment" in a public speech, stating that Musk actually "fully understood the contents of the bill" but was dissatisfied due to the "cancellation of the mandatory electric vehicle sales regulations."

Musk responded, "The Trump administration retained provisions in the draft to cut electric vehicle and solar incentives, but did not touch a penny of subsidies for oil and gas. Moreover, this bill was never shown to me; it was passed quickly in the middle of the night, and hardly anyone in Congress could understand it."

Musk also mocked Trump by bringing up an old tweet from 2013 where Trump criticized raising the debt ceiling, in which Trump stated, "I can’t believe the Republicans are raising the debt ceiling. I’m a Republican, and I’m very ashamed!" Musk quoted this statement and called it "a profound truth."

Second Round of Insults: From "Election Gratitude" to "Supply Cut Threats"

The dispute quickly escalated, with Musk publicly accusing Trump on the X platform of being "ungrateful," stating that if it weren't for his initial support, Trump would never have won the election. He wrote, "Without me, Trump would lose the election. The Democrats would control the House, and the Republicans would drop from 51 seats in the Senate to 49."

Trump shot back, "Even without Musk, I could win Pennsylvania." He then posted on Truth Social that the most direct way to cut the budget deficit was to terminate government subsidies and contracts for Musk and his companies, "which would save billions. I’ve always been surprised that Biden hasn’t done this!"

Musk immediately responded strongly: "In light of President Trump's statement about canceling my government contracts, SpaceX will immediately begin retiring the Dragon spacecraft." It is reported that current U.S. manned space activities heavily rely on SpaceX's Dragon spacecraft.

At this point, the verbal conflict had escalated into a political and technological crisis.

Third Round of Insults: Musk "Bombs," Targeting Trump's "Lolita Island" Scandal

The flames of war reached Trump's "sensitive past." Musk publicly revealed, "Trump appears in Epstein's documents. This is the real reason these documents have not been released. Have a nice day, DJT!"

This accusation pushed the conflict to a climax. The named Jeffrey Epstein was widely known for his involvement in underage sex trafficking and sexual assault cases, and after being arrested in 2019, he "committed suicide" in prison, leaving many unresolved mysteries. When Trump was campaigning, he stated he would release a list of prominent figures involved in "Lolita Island," which was said to include some well-known Democrats or supporters.

Musk did not stop there, retweeting a post calling for "impeaching Trump and having JD Vance take over." He also initiated a poll on X asking, "Is it time to establish a new political party in America that truly represents the middle 80%?" To this, Trump responded that he was unfazed: "I don’t mind Elon Musk opposing me, but he should have done it months ago."

The Storm Continues

The turmoil continued to escalate, with intense rhetoric pouring in. Trump's former senior advisor Steve Bannon publicly called for a thorough investigation into Musk, even suggesting "deportation." In an interview with The New York Times, he stated, "I firmly believe he is an illegal immigrant and should be deported immediately. He is suspected of drug use, and all government contracts related to him should be canceled."

Meanwhile, the White House also acted swiftly. According to Jinshi reports, insiders revealed that senior White House staff held multiple closed-door meetings today to urgently assess the impact of Musk's tweets.

Financial mogul Bill Ackman also voiced, "Musk and Trump, together they benefit, apart they hurt." Musk succinctly replied, "You’re not wrong." This interaction was seen by the market as a potential signal for a temporary reconciliation between the two.

However, the direction of the plot remains full of uncertainties. Crypto influencer Bruce J analyzed, "I predict there may be 'mediators' involved later; the big beautiful bill will still pass, but some spending will be cut to give all parties a way out; Trump and Musk will temporarily cease fire, but their personal friendship will be completely severed."

Whether this storm ultimately leads to a temporary "reconciliation" or escalates into a full-blown showdown of power and capital, this dispute has long surpassed personal grievances, affecting political nerves and market dynamics. As one netizen aptly joked, "Neither of these two has done what an adult man should do—control his emotions and watch his mouth."