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DOGE, ADA Nosedive 7% as Crypto Traders Digest ‘Recession’ Sentiment
Investors weigh tensions between Elon Musk and President Trump alongside broader recession fears as markets digest the latest macro signals.
Jun 6, 2025, 5:46 a.m.
What to know:
- Dogecoin and Cardano led cryptocurrency declines amid recession fears and a feud between Elon Musk and Donald Trump.
- Bitcoin rebounded slightly after a drop, while other major cryptocurrencies fell between 2%-5%.
- Analysts cite political tensions and macroeconomic concerns as key factors in the market's downturn.
Dogecoin and Cardano's ADA led the declines on Friday as crypto traders digested mixed macro data and recession concerns sparked by an escalating feud between President Donald Trump and tech titan Elon Musk.
DOGE tumbled nearly 7% in 24 hours, while ADA slid 6.5% to reflect a risk-off shift among crypto traders.
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Bitcoin bounced above $102,000 in Asian morning hours after falling to near $101,000 on Thursday night, with ether , XRP , BNB Chain’s BNB and Solana’s SOL down between 2%-5%.
The spat between Musk and Trump rattled confidence, with Musk warning that the U.S. is likely headed for a technical recession this year — a concern that weighed heavily on speculative assets.
The Trump tariffs will cause a recession in the second half of this year https://t.co/rbBC11iynE
— Elon Musk (@elonmusk) June 5, 2025
“The quarrels between Elon Musk and President Trump exposes divides that could hinder plans to reform the US economy, which is why cryptocurrencies as a whole dropped overnight,” said Jeff Mei, COO at BTSE, in a Telegram message to CoinDesk.
“However, we are still positive on the long-term viability of crypto markets, and given the success of Circle's IPO yesterday, it's clear that there are still many institutional investors who feel the same way,” Mei added.
Some analysts pointed to the growing risk that political infighting could spill over into markets.
“While recent US macroeconomic reports influenced the sell-off, the negative outlook has been mostly driven by the escalating tensions between President Trump and Elon Musk,” said Nick Ruck, director at LVRG Research, told CoinDesk.
“Investors fear their feud could spill over into the markets. We remain optimistic for the long term as institutions continue to build within the greater crypto ecosystem,” Ruck added.
Traders remain cautious as the market awaits clarity on the debt ceiling debate and the potential impact of Trump’s proposed “One Big Beautiful Act” on fiscal policy.
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Japan’s Higher Rates Puts Bitcoin in the Crosshairs of a Yen Carry Unwind
A stronger yen typically coincides with de-risking across macro portfolios, and that dynamic could tighten liquidity conditions that recently helped bitcoin rebound from November’s lows.
What to know:
- The Bank of Japan is expected to raise interest rates to 0.75% at its December meeting, the highest since 1995, affecting global markets including cryptocurrencies.
- A stronger yen could lead to de-risking in macro portfolios, impacting liquidity conditions that have supported bitcoin's recent recovery.
- Governor Kazuo Ueda indicated a high probability of a rate hike, with officials prepared for further tightening if their economic outlook supports it.
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