A late-night Twitter spat between President Donald Trump and Elon Musk sparked fresh uncertainty in global markets, sending major cryptocurrencies tumbling and wiping out nearly $1 billion in leveraged bets.

Bitcoin (BTC) price plunged by over 9% in the past 24 hours, falling below the $40,000 level for the first time since early April. The flagship cryptocurrency is now trading around $39,000, according to Bitcoin Price Index.

Ether (ETH) price also declined sharply, dropping by 12% to trade below $3,000 at the last check.

Image: Bankiv

As of 08:05 (GMT+8), traders lost $988 million in liquidations — of which $888 million were long positions — according to data from CoinGlass.

Exchanges like Bybit and Binance saw the biggest hits, with Bybit alone accounting for nearly $354 million in liquidations.

The liquidations largely hit major tokens, with bitcoin leading the pack at over $342 million liquidated in the past 24 hours.

Solana (SOL) was a close second with over $208 million in liquidations, followed by XRP at $119 million.

Liquidations to the forced closure of a trader's leveraged position when they can no longer meet the margin requirements. This typically occurs when the price of the underlying asset moves against their position, causing them to lose a large portion, or all, of their initial investment.

A cascade of liquidations often indicates market extremes, where a price reversal could be imminent as market sentiment overshoots in one direction.

The sell-off comes as Trump accused Musk of going “crazy” and threatened to terminate government contracts with his companies, while Musk lashed back by linking Trump to Jeffrey Epstein’s files.

The clash overshadowed what had been a mostly bullish trend for crypto markets in recent weeks, intensifying a profit-taking bout from the start of this week.