Leading coin Bitcoin has been in a corrective phase since hitting its all-time high of $111,968 on May 22. The king coin has slipped below the key $105,000 support level to trade at $104,536 at press time, reflecting the selling pressure.
However, on-chain data suggests a potential rebound above this critical support level, with a possible retest of BTC’s all-time high on the horizon. This analysis breaks down the key insights.
BTC Liquidity Clusters Signal Surge Toward $109,000
An assessment of BTC’s liquidation heatmap shows a notable concentration of liquidity around the $109,933 price zone.
Liquidation heatmaps identify price levels where large clusters of leveraged positions are likely to be liquidated. These maps highlight areas of high liquidity, often color-coded to show intensity, with brighter zones (yellow) representing larger liquidation potential.
Usually, these cluster zones act as magnets for price action, as the market tends to move toward these areas to trigger liquidations and open fresh positions.
Therefore, for BTC, the convergence of a high volume of liquidity at the $109,933 price level indicates a strong trader interest in buying or closing short positions at that price. It creates room for a surge toward the $109,000 mark.
Further, the coin’s funding rate has remained positive despite its recent price pullback. At press time, this stands at 0.005%, per Coinglass.
The funding rate is a periodic payment between traders in perpetual futures contracts to keep the contract price aligned with the spot price. When the funding rate is positive, there is a higher demand for long positions.
This means more traders continue to bet on BTC’s price going up, even in the face of strengthening bearish momentum.
BTC Price Teeters Between $103,000 Support and $109,000 Liquidity Zone
BTC has posted a modest 1% gain in the past 24 hours, bouncing off the $103,952 support level. If demand soars, this support floor could hold firm and push prices above the psychological barrier at $105,000, potentially targeting $106,307.
A clean break above this zone may open the door to the $109,000 price area dense with leveraged positions.
BTC Price Analysis. Source: TradingView
However, increased profit-taking could drag BTC back below $103,952, with a further decline toward $102,590 likely.
Several political reports claim President Trump did not initially intend to put XRP in his Crypto Strategic Reserve. Instead, they suggest that lobbyist Brian Ballard manipulated him into doing so.
Although the President was allegedly furious at these events, this may not change XRP’s position in the Reserve. Ripple’s CEO, Brad Garlinghouse, vocally supports and has made large donations to Trump’s election campaign.
When Trump made a social media post a month into the office, it included SOL, ADA, and XRP in the mix, boosting the notoriety of these assets. Today, Politico made shocking allegations suggesting that this was not his intention.
Specifically, the report alleged that Brian Ballard, a lobbyist who has worked with Trump for years, used underhanded tactics. One of Ballard’s employees repeatedly petitioned Trump to endorse XRP and other altcoins in his post.
Most notably, Ripple Labs is also a Ballard client, which paid the lobbyist $60,000 last year. When the President discovered this, he apparently raged.
Ripple Listed as a Ballard Partners Client. Source: OpenSecrets.
Meanwhile, the US president has now exiled Brian Ballard. The community reacted strongly to these events, suggesting Trump might remove XRP and other altcoins from the Strategic Reserve. However, this may be overstated for a few reasons.
Trump was allegedly angry over being misled, not because he had a specific distaste for XRP. The Reserve announcement occurred shortly before Trump’s Crypto Summit, and David Sacks worried about perceived favoritism. Nonetheless, Ripple has been a good friend to the President.
President Trump exiled a top lobbyist for promoting Ripple’s XRP.
In other words, why would Trump decide to punish XRP for Ballard’s actions? These allegations are indeed shocking, but the market evidently doesn’t expect turmoil for XRP at this time.
To be clear, neither Trump, Ballard, nor Ripple employees have responded to these allegations. Regarding XRP’s place in the Reserve, Trump may simply let bygones be bygones.
It’s important to understand that while the US president signed an executive order to ‘assess the establishment’ of a strategic crypto reserve, no developments have been made yet.
Over the past few months, Ethereum has experienced a significant decline in user activity on its blockchain. This slowdown has reduced the network’s burn rate—a mechanism that helps decrease ETH supply over time.
With fewer tokens being burned, ETH’s circulating supply has risen, putting inflationary pressure on the asset. As a result, the coin has struggled to maintain a stable price above the $2,000 level in recent months.
Low Burn Rate Equals More Coins in Circulation
According to Ultrasoundmoney, 72,927 ETH, valued at $134 million at current market prices, have been added to ETH’s circulating supply in the past month alone.
At press time, this sits at 120,730,199 ETH, significantly above pre-merge levels.
This increase in ETH’s supply is driven by a decline in user activity on the Ethereum network, reducing its burn rate. Ethereum’s burn mechanism, introduced through EIP-1559, destroys a portion of transaction fees to reduce the circulating supply of ETH.
However, this mechanism is directly tied to network usage. So, when fewer transactions occur like this, less ETH is burned, resulting in ETH’s supply spiking.
According to Etherscan, the daily amount of ETH burnt has dropped by 95% year-to-date. In fact, the network recently recorded its lowest amount of coins burnt in a single day on April 20.
Many users and developers are migrating from Ethereum to Layer-2 (L2) solutions like Optimism and Arbitrum. These networks offer significantly lower transaction fees and faster execution, reducing user activity on Ethereum’s mainnet.
For example, as of April 30, the average transaction fee on Optimism’s mainnet was just $0.024. By contrast, completing a transaction directly on Ethereum cost users an average of $0.18 on the same day, which is over seven times more expensive.
Optimism Average Transaction Fee. Source: Dune Analytics
Moreover, thanks to the recent meme coin mania, “Ethereum killers,” such as Solana, have gained significant traction over the past few months, drawing users away from the L1.
Together, these trends have led to a decline in Ethereum’s transaction count, hence the network’s low burn rate.
How Do Ethereum’s Fundamentals Stack Up?
The drop in Ethereum’s user demand and the subsequent rise in ETH’s supply have raised important questions about the strength of its fundamentals.
When asked how Ethereum currently compares to other Layer-1 (L1) networks amid broader market weakness, Vincent Liu, Chief Investment Officer at Kronos Research, offered his perspective.
“Ethereum’s fundamentals remain strong relative to other Layer 1s, particularly when you consider its total value locked (TVL) of $368.921 billion, which positions it at the top of the leaderboard,” Liu said.
Although Liu acknowledged that Ethereum ranks fifth in 24-hour fees, behind Tron, Solana, HyperLiquid, Bitcoin, and BNB Chain. He emphasized that the network still “demonstrates significant demand and usage.”
Temujin Louie, CEO of Wanchain, shares a similar perspective. While speaking with BeInCrypto, Louie noted:
“Compared to other Layer 1s, fundamentals remain Ethereum’s strength. Unlike many Layer 1s with aggressive inflation as part of their design, Ethereum’s post-merge architecture makes it potentially deflationary. However, the benefits of EIP-1559 depend on on-chain activity. Nevertheless, this is a structural advantage over most competing Layer 1s.”
While increased activity across Layer-2 (L2) solutions and “Ethereum killers” like Solana may have contributed to a decline in user demand on Ethereum itself, Louie believes that the L1 network “remains a leader in decentralization and has a near-unmatched track record that continues to secure its place in the market.”
What About ETH Price?
Even with strong fundamentals, declining activity on Ethereum poses challenges for ETH in the short- to mid-term. Commenting on this, Liu explained that lower network activity generally signals weaker demand for ETH.
At the same time, increased coin issuance on the network undermines Ethereum’s deflationary model, which was designed to support price appreciation.
“This combination could result in bearish price movements,” Liu warned, “especially as investors look to alternative Layer 1s offering better scalability and lower fees.”
Kadan Stadelmann, CTO of Komodo Platform, also highlighted the role of macroeconomic factors:
“If Ethereum experiences an extended decrease in usage, the price could fall considerably depending on how much use drops, especially if the Fed continues its policy of quantitative tightening compared to quantitative easing. Short-term, this could mean price drops down to the $2,000 range. If the trend continues, however, then Ethereum could find itself in a prolonged consolidation period or outright downtrend.”
ETH Eyes $2,000 Breakout Amid Strengthening RSI
ETH currently trades at $1,834, noting a 1% price dip over the past day. Despite the brief pullback, the bullish pressure in the coin’s spot markets continues to strengthen, reflected by the coin’s climbing Relative Strength Index (RSI).
At press time, this momentum indicator is at 57.68. ETH’s RSI readings signal growing bullish conditions. This indicates that the altcoin has room for upward movement if buying pressure increases.
In this scenario, its price could break above $2,027.
Scammers are targeting Ledger wallet users with a sophisticated phishing campaign involving fraudulent physical letters posing as official company correspondence.
The deceptive letters misuse Ledger’s branding, logo, and official address, urging users to provide their 24-word recovery phrases under the pretext of a “critical security update.” The letters threaten to restrict wallet access if the instructions are not followed.
Crypto Users Warned of Phishing Scam Involving Fake Ledger Letters
Trader Jacob Canfield exposed the scam via a post on the X (formerly Twitter) platform, highlighting the letter’s alarming authenticity.
Breaking: New scam meta launched. Now they’re sending physical letters to the @Ledger addresses database leak requesting an ‘upgrade’ due to a security risk.
Be very cautious and warn any friends or family that you know is in crypto and is not that savvy. pic.twitter.com/XoUAGQBJXt
“Failure to complete this mandatory validation process may result in restricted access to your wallet and funds. This security measure is Imperative to safeguarding the Integrity of our platform and protecting user assets,” the fraudulent letter read.
According to Canfield, this scam likely leverages a major data breach Ledger experienced in July 2020. Hackers leaked the personal information of approximately 272,000 users, including names, phone numbers, and postal addresses.
This stolen data appears to have enabled scammers to target Ledger users with personalized physical letters, enhancing the perceived legitimacy of the phishing attempt.
Notably, Ledger issued an official response, confirming the letter as a scam. The post emphasized that the company never requests recovery phrases through phone calls, messages, or other mediums.
“Always remember: Ledger will never call, DM, or ask for your 24-word recovery phrase. If someone does, it’s a scam. Stay cautious and keep your crypto safe,” the statement read.
The company urged users to remain vigilant against phishing attempts. Ledger also assured users that its hardware wallets and funds remain secure, as the devices are designed to keep private keys isolated from vulnerabilities.
Canfield highlighted the potential impact on less tech-savvy individuals, particularly elderly users, who may be more vulnerable to such tactics. He requested that Ledger proactively notify its customers through official channels to prevent further exploitation.
The latest scam adds to a long list of fraudulent schemes targeting cryptocurrency users. Recently, an SMS phishing scam targeted several Binance users.
