Trump and Musk Split: Full Analysis of TSL Big Dump and Bitcoin Rebound

Key Points

  • – In early June 2025, a few days after Musk left his advisory role in the Trump administration, both sides publicly fell out, triggering impeachment rumors and significant market volatility.
  • – The core trigger of their conflict revolves around the "Big and Beautiful Act" driving the fiscal deficit and the policy divergence regarding the withdrawal of electric vehicle incentives.
  • – Tesla's stock price plummeted by 14%, erasing hundreds of billions in market value; meanwhile, Bitcoin prices and BTC spot trading volume surged significantly as investors sought safe-haven assets.
  • – This turmoil brings significant suspense for the 2026 midterm elections, the prospects of SpaceX contracts, and the role of cryptocurrencies as a safe-haven asset on platforms like XT Earn. trump-musk-feud-cover-cn In early June 2025, the seemingly unbreakable "marriage" between President Trump and tech tycoon Musk suddenly collapsed. The cause was Musk's dissatisfaction with federal spending and electric vehicle policies after leaving the White House Efficiency Committee, leading to public outbursts that quickly sparked impeachment rumors, a massive sell-off of Tesla shares, and a rapid rebound of Bitcoin BTC.

This article will analyze the positive conflict between individuals and policies from five perspectives—historical background, June timeline, political impact, business consequences, and reactions in the crypto market—how it has triggered a ripple effect in Washington, Wall Street, and Silicon Valley.

Directory

Background: From Watching to the White House "Honeymoon"

June 2025 breakup timeline

Political Shock and Impeachment Wave

Business Consequences: Tesla's Plunge and SpaceX's Survival

Crypto Market Earthquake: Why Bitcoin is Rising Against the Trend

Future Outlook: How will the situation evolve next?

Background: From Watching to the White House "Honeymoon"

trump-musk-image-1

Image Credit: CNN

Early Interaction (2016 – 2017)

In November 2016, after Trump's unexpected election, Musk stated on Twitter, "The character of this new president does not seem to represent the image of America very well." However, in December of the same year, Musk joined Trump's business advisory council, trying to exert influence on climate and immigration policies. In June 2017, Trump announced the withdrawal from the Paris Climate Agreement, and Musk immediately resigned from his advisory position, stating that this decision "is not beneficial for America and the world."

Friction during the government term (2017 - 2021)

During Trump's first term, Musk's interactions with the government were sporadic and often contentious. He publicly criticized the suspension of certain work visas, arguing that it was detrimental to Tesla's ability to recruit skilled talent; he also opposed trade tariffs that could threaten Tesla's overseas production. Musk's remarks sometimes even impacted the crypto market, causing temporary fluctuations in BTC/USDT spot and BTC/USD coin-margined contract trading. Many investors, seeking to mitigate risk, would turn to Bitcoin staking or yield products like XT Earn.

Public Feud in 2022

In mid-2022, after Musk acquired Twitter, he restored Trump's account, calling the previous ban "stupid." In response, Trump countered at a rally in Alaska, labeling Musk as "another guy talking nonsense," to which Musk retorted, suggesting he "put away that hat and take a vacation at sea."

The "honeymoon period" of 2023 - 2024

In July 2024, after Trump survived an assassination attempt, Musk publicly supported him by donating $277 million through a Super PAC. He also held a live interview with Trump on the X platform and proposed the establishment of a "Department of Government Efficiency" (DOGE) program. This seemingly unlikely "honeymoon relationship" began, laying the groundwork for a later rift.

trump-musk-image-4

Image Credit: USA Today

Timeline of Disputes in June 2025

trump-musk-table-1-cn

late May 2025

After serving as a temporary special employee of the "Department of Government Efficiency" (DOGE) for about 130 working days, Musk officially left the White House at the end of May. During the farewell ceremony, Trump presented him with the "Key to the White House," but it also hinted at the cracks that had appeared in their relationship.

trump-musk-image-5

Image Credit: Mediaite

June 1 - 3

A few days later, Musk publicly stated on X that the "Big and Beautiful Act" would lead to uncontrollable fiscal deficits, calling it a "despicable act." Trump immediately threatened to revoke electric vehicle incentives for Tesla and to reassess SpaceX's federal contracts, warning that if Musk continued to criticize the government, his businesses would face serious consequences.

June 4 - 5

On June 4, Musk posted (and later deleted) remarks on X implying that Trump's name appeared in the Epstein sealed documents, triggering a strong denial from the White House and impeachment rumors. Trump retaliated on Truth Social, calling Musk "crazy" and hinting at the possibility of reinstating his advisory role, further intensifying public opinion.

June 6 - 7

The market is experiencing severe fluctuations. On June 6, Tesla's stock price plummeted over 14%, evaporating about $138 billion in market value in a single day, with Musk losing approximately $34 billion. Meanwhile, the price of Bitcoin surged nearly 8% due to safe-haven demand, with BTC/USDT spot trading volume and Bitcoin spot inflows into custody products significantly increasing.

June 8 - 11

Starting from June 8, both parties began to tone down their rhetoric. Musk deleted the most controversial posts and responded to Trump's friendly greeting with "Likewise"; Trump publicly stated that he "wasn't thinking about Elon" but also sent his best wishes. Despite the easing of tensions, no formal reconciliation dialogue was arranged between the two parties, and as of June 11, the rift still exists.

Political Shock and Impeachment Wave

trump-musk-image-2

Image Credit: Radboud University

Policy differences ignite the fuse

The fuse was lit when Musk publicly criticized Trump's "Big and Beautiful Act," calling it a "disaster" that would lead to uncontrolled federal deficits; Trump immediately retaliated, threatening to revoke electric vehicle incentives for Tesla and potentially rescind SpaceX's federal contracts.

Impeachment rumors are rampant.

On June 5, Musk took a step further by hinting on X that Trump was involved in the Epstein sealed documents and publicly supporting calls to impeach Trump (the related remarks were later deleted). The public opinion arena instantly exploded: liberal commentators praised Musk for his candor, while conservatives criticized him for overstepping his bounds. Although discussions of impeachment are premature, they dominated television and radio headlines for several days.

Intra-party dynamic differentiation

Cracks are appearing within the Republican Party. Some establishment figures privately lament the loss of Musk's massive support—he donated about $277 million to Trump's camp through a super PAC in 2024; meanwhile, extreme MAGA supporters stand by Trump, viewing Musk as an "elite interloper." With the 2026 midterm elections approaching, strategists warn that donors like Musk, who understand technology, switching sides could force the Republican Party to seek new sources of funding and even lose its liberal base voters.

Media Interpretation

Major news outlets have packaged this conflict as the ultimate showdown between "billionaires and the president." The Associated Press and various major television networks repeatedly aired old photos of Musk and Trump, contrasting their latest remote exchanges and portraying the situation as a political thriller of power and grudges. Financial channels also pointed out that this turmoil has even affected the crypto market: risk-averse investors are selling stocks and shifting to BTC/USDT spot trading, with demand for yield products like XT Earn also rising. Meanwhile, public opinion continues to discuss who has the upper hand: Trump, who holds federal power, or Musk, who controls social media and market trends?

Business Consequences: Tesla Sell-off and Risks Faced by SpaceX

Market Impact

The public confrontation immediately shook the financial markets. On June 6, Tesla's stock price plummeted over 14%, with a market value evaporating by about $138 billion, and Musk personally losing around $34 billion. Analysts say that this sell-off stemmed from investors' concerns over Trump's threats, coupled with Musk's unpredictable words and actions, which may weaken Tesla's reliance on federal subsidies and contracts. Hedge funds and retail investors rushed to liquidate their positions, while Bitcoin (BTC) surged simultaneously, with prices soaring nearly 8%, becoming a new safe haven for funds.

Policy Threat

Trump publicly warned that he might cancel or renegotiate federal contracts and subsidies that benefit Musk's companies, specifically targeting the billion-dollar launch agreements between SpaceX and NASA, as well as the tax credits for Tesla's electric vehicles. He even hinted at stripping SpaceX of its qualification to provide space transportation services for American astronauts, which would force NASA to urgently seek alternatives.

trump-musk-image-6

Image Credit: Inspired Pencil

Competitive Landscape

Competitors are acting quickly. Blue Origin and United Launch Alliance (ULA) are intensifying their pitches to NASA, preparing to step in when SpaceX's contracts are restricted. Meanwhile, some conservative consumer organizations have begun to initiate boycotts against Tesla in states where "Trump supporters" gather, which may weaken its market share in key areas.

Brand Reputation

Polls and social media sentiment indicate that Tesla's brand support is becoming polarized: one segment of urban progressives continues to support it, while Republican supporters are showing distrust. Institutional investors, including several pension funds and ESG investors, have paused new allocations to Tesla, waiting for clarity on policy risks.

Crypto Market Quake: Why Bitcoin is Rising Against the Trend

Safe-haven funds flow in

As Tesla's stock price plummeted on June 6, investors turned to alternative assets, with Bitcoin emerging as the biggest winner. Within two days, the BTC spot trading volume on major exchanges surged by over 35%, reflecting the urgent demand from investors for non-correlated stores of value. Portfolio managers stated that political uncertainty and stock market volatility are the main drivers of capital flowing into the crypto market.

Correlation breakdown

Historically, Bitcoin (BTC) has typically maintained a certain correlation with risk assets during market panic. However, this relationship was completely broken in early June: on June 6, the S&P 500 index fell by more than 2%, while the price of Bitcoin surged by nearly 8%, showing a clear decoupling from the traditional stock market. This divergence is even more pronounced in the BTC/USDT trading pair, where both trading volume and volatility far exceed those of stocks, highlighting the hedging function of crypto assets during political turmoil.

On-chain metrics

On-chain data further corroborates this trend. From June 5 to 7, the number of new wallet addresses increased by 40%, indicating that both retail and institutional investors are entering the market; during the same period, the total network trading volume also surged by 25%, primarily driven by large transfers to custodial and self-custody wallets, reflecting both speculative demand and strategic positioning.

trump-musk-image-7

Image Credit: Glassnode

long-term impact

The market conditions at the beginning of June may become a watershed moment for investors in viewing cryptocurrencies. If Bitcoin continues to play a safe-haven role amid future geopolitical or policy turmoil, products such as Bitcoin staking and yield platforms like XT Earn may see sustained growth, allowing cryptocurrencies to stand alongside gold and government bonds in diversified investment portfolios.

Future Outlook: What Comes Next?

Possible reconciliation

If Trump concedes on the electric vehicle incentive policy - for example, by restoring some subsidies - or if Musk agrees to tone down his criticism in exchange for preserving SpaceX's launch contracts, there may still be room for improvement in their relationship. After all, the competitiveness and innovation interests of the United States are common ground for them.

Impact of the 2026 Elections

Elon Musk's substantial financial resources and technological appeal may support the opposition within the Republican Party or influence tech-sensitive voters through platforms like X. If their rifts persist, Trump may face the risk of losing some key supporters.

Business strategy shift

Tesla may reduce its dependence on federal subsidies and accelerate the development of overseas markets to diversify political risks. At the same time, SpaceX can seek more commercial and international launch contracts as a hedge against uncertainties arising from changes in U.S. policy.

Cryptocurrency Trends

If Bitcoin (BTC) continues to play a safe-haven role, we may see strong demand for the BTC/USDT trading pair, as well as increased attention on yield platforms like XT Earn. Conversely, once market and political volatility subsides, crypto assets may also return to normal.

Conclusion

The split between Trump and Musk indicates that alliances based on mutual interests can collapse when policies conflict with personal demands. The controversy surrounding government spending, electric vehicle incentives, and federal contracts not only tore apart the collaboration between these two heavyweight figures but also triggered a sharp decline in Tesla's stock price and a surge in Bitcoin prices and spot trading volume, causing market turbulence. This highlights the deep interconnection between politics, big tech, and finance—one tweet can trigger a chain reaction in the boardroom and trading desk. As both sides adjust their strategies, investors should closely monitor policy trends and market signals, as fluctuations in XT Earn's yields or subtle shifts in Bitcoin BTC sentiment could reveal the next direction of this high-risk showdown.

Frequently Asked Questions

What triggered the conflict between Trump and Musk?

It started with Musk criticizing the "Big and Beautiful Act" for exacerbating the fiscal deficit, and Trump immediately threatened to cut electric vehicle incentives and SpaceX contracts — the policy dispute became the catalyst.

How did Tesla's stock price react?

On June 6, Tesla's stock price plummeted more than 14%, with a market value evaporating by about 138 billion dollars, and Musk's fortune lost approximately 34 billion dollars that day.

What policy risks did Trump threaten?

He warned that federal subsidies and NASA launch contracts favorable to Musk's companies might be canceled or renegotiated, directly targeting Tesla's electric vehicle tax credits and SpaceX's astronaut transportation agreements.

Why is Bitcoin rebounding amid turmoil?

Investors are turning to safe-haven assets to avoid stock market volatility, driving the price of Bitcoin up nearly 8%.

What changes have occurred in the trading volume of BTC/USDT?

From June 6 to 7, the BTC/USDT spot trading volume surged over 35% across major exchanges, indicating a capital influx into the crypto market.

What role might XT Earn play in the future?

Under political and market uncertainty, yield platforms such as XT Earn may attract more capital for passive income generation through digital assets.

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The content is for reference only, not a solicitation or offer. No investment, tax, or legal advice provided. See Disclaimer for more risks disclosure.
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