Dogecoin has dropped by 10% today, with its losses in the past week now around 22%, after Elon Musk officially ended his relationship with the Trump administration and cut ties with the Department of Government Efficiency (DOGE). The clash comes after a political feud between both parties, dragging the token deep into the bearish abyss.
The drama started earlier in the week when Musk took shots at Trump’s latest spending bill. Trump refused to stay quiet, hitting back at Musk by pulling his NSA nomination of Jared Isaacman, a longtime ally of Musk and the man he wants leading the US space exploration efforts. The withdrawal removed any hope of peace between them.
Dogecoin tanks as Musk and Trump make threatening moves
The fight between the parties became a public war on Thursday, with Trump telling the press that he was very disappointed in Musk. Within hours, Musk fired back, noting that Trump would have lost the election without him, a notion which Trump called “CRAZY.” He followed his reply with a threat to cancel federal contracts awarded to Musk’s companies. The impact on the market was immediate. Tesla shares fell 14% before closing for the day. Elon didn’t hesitate.
Musk took to X where he said, “Go ahead, make my day,” and then announced that SpaceX would begin shutting down its Dragon spacecraft program. Dragon is the only American spacecraft that transports astronauts to and from the International Space Station. While there was no mention of Dogecoin, it did not matter. The coin has never been tied to any real-world value or asset. Instead, it runs on hype, and above all, Elon’s influence. That’s why this political chaos hit so hard.
Elon leaving Washington means his influence is fading, and Dogecoin holders are taking the hit. In 2022, Dogecoin jumped 15% in a day after Tesla accepted it for merch. In 2023, Elon replaced the Twitter logo with a Shiba Inu, the Dogecoin mascot, and the price surged over 30%. Now that Elon is out of Trump’s circle, and contracts are under threat, that same price is collapsing. In November 2024, after Trump’s win, Dogecoin rallied, with coins like Bitcoin leading the way.