Why is the crypto market down today?

Key points:

• The total crypto market cap fell 2.30% to $3.21 trillion on June 6, fueled by the Trump-Musk feud.

• Over $980 million in crypto futures liquidated, with $874 million in longs reinforcing the intensity of the selling pressure.

• Total crypto market cap risks falling toward $2.9 trillion after breaking below a descending parallel channel.

The combined valuation of all cryptocurrencies has fallen by around 2.30% in the past 24 hours to reach $3.21 trillion on June 6. 

Let’s look closer at the factors driving the crypto market down today.

Trump-Musk feud fuels crypto sell-off

Crypto prices began falling during late New York trading hours on June 5 following a public spat between US President Donald Trump and billionaire Elon Musk. 

The two billionaires, united during the 2024 US Presidential election, exchanged pretty sharp remarks online, triggering a risk-off mood among investors. 

Musk took aim at Trump’s recent spending bill, dubbed the Big Beautiful Bill and backed calls for his impeachment. 

Trump responded with strong comments about the economy, saying that terminating Musk’s government subsidies and contracts would save “billions and billions of dollars” for the US government.  

In response, Bitcoin (BTC) dropped by as much as 5.2% to as low as $100,400 on Bistamp before recovering to the current levels above $103,200. The decline in BTC triggered panic selling among crypto investors, with cryptocurrency prices dropping.

Ether (ETH) dipped as low as $2,384 on June 6, marking 4% losses over the last 24 hours. XRP (XRP) and Solana (SOL) also witnessed significant losses, down 4% and 5.2%, respectively. 

Dogecoin (DOGE), a memecoin usually associated with Elon Musk, bore the brunt of the sell-off, losing 9% of its value in the past 24 hours.

Crypto market suffers $980M in liquidations

The cryptocurrency market’s sell-off today coincides with a wave of liquidations in the futures market, totaling $979.9 million in the last 24 hours.

Notably, the futures market witnessed long liquidations worth $874 million, the largest single-day liquidation since Feb. 25. Short traders saw significantly lower liquidations at $105 million.

Bitcoin and Ether led the losses with $342.9 million and $285 million in liquidations, respectively. Solana followed with $50.3 million, while Dogecoin and XRP saw $27 million and $23 million liquidated, respectively.

This scale of liquidation exacerbates price drops and instills fear among other market participants, leading to further selling pressure. 

Related: Fed rate cut decision to ‘impact heavily’ on if Bitcoin hits $112K: Analyst

Analysts are now focusing on key support areas for major cryptocurrencies, with CryptoQuant analyst Axel Adler Junior saying the nearest support for Bitcoin now lies at the short-term holder (STH) realized price of around $97,500.

After yesterday’s explosive clash between Elon and Donald, the Bitcoin futures market saw $324 million in long-position liquidations. The nearest support for the STH Realized Price is at $97.5. pic.twitter.com/hJK7ZtgVgu— Axel 💎🙌 Adler Jr (@AxelAdlerJr) June 6, 2025

Crypto market’s technical breakdown

From a technical standpoint, the crypto market’s ongoing decline is occurring after breaking below multi-week support at around the $3.25 trillion level.

The chart below shows the market retesting the major support around $3.12 trillion, where the 50-day and 200-day simple moving averages (SMAs) converge. Note that the last time TOTAL — the combined market capitalization of all cryptocurrencies — fell below this level was on Feb. 24, triggering a 26% drop in the price.

The relative strength index (RSI) has dropped to 45 from overbought conditions at 79 on May 10, suggesting increasing downward pressure.

If TOTAL drops below $3.12 trillion, the market risks dropping toward the 100-day SMA at $2.9 trillion in the short term.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.