The Bitcoin network split due to the BIP-110 soft fork, Bybit sued North Korea over a $1.5 billion theft, the U.S. Senate delayed a vote on the CLARITY Act, and other developments from the week.
Bitcoin back to $65,000
The week opened with the pullback continuing: on August 4, the first cryptocurrency fell below $63,000. Over the following days, the asset traded in a narrow $62,000–$63,000 range.
On-chain data confirmed the protracted decline: Glassnode recorded the longest bitcoin capitulation phase on record. Analysts cautioned that lower volatility does not mean the market is quiet.
The price then rebounded and, at press time, reached $65,200 — the highest level since late July.
Institutional flows fueled the turnaround. Spot bitcoin ETFs attracted $853 million, and CryptoQuant analysts recorded accumulation of bitcoin, Ethereum, and XRP by large holders. Wallets with balances from 10 to 10,000 BTC bought more than 20,000 coins since July 29.
Ether funds also stayed positive, taking in $244 million — the largest weekly inflow into the products since mid-April.
For the week, bitcoin rose 3.4%. Ether posted a similar move, up 3.7%. The Hyperliquid token led gains, rising more than 6%.
The crypto fear and greed index remains in “fear” at 31.
The digital asset market’s capitalization rose from $2.16 trillion to $2.22 trillion. Bitcoin’s dominance also inched up — from 58.5% to 59.3%. Ethereum’s share reached 10.5%.
Bitcoin network splits over BIP-110 soft fork
On August 8, the Bitcoin network split at block #961,632: nodes running BIP-110 software stopped accepting blocks whose creators did not signal support for the proposal.
The split was caused by two competing blocks at the same height. AntPool mined #961,632 without the support signal; the main chain accepted it, while supporters of the proposal switched to an alternative from the Roughnecks mining collective operating via the Ocean pool.
Difficulty is preventing the breakaway branch from catching up: the next retarget fell exactly on the split block. Over eight hours it produced two blocks versus 48 on the main chain.
Support for the proposal was absent from the outset — two weeks before the soft fork, 2.53% of blocks signaled for it versus the 55% required.
On the eve of the split, developer Kevin Loaec pointed out the risk of losing real bitcoins when selling coins on the new chain. Both branches accept the same transactions, so an attacker could relay a signed transfer to the main chain.
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Strategy keeps selling bitcoin
From July 27 to August 2, Strategy sold 1,638 BTC for $104.7 million at an average price of $63,957 per coin. Proceeds went to dividends on preferred shares and a buyback of STRC stock — over the week the company bought 912,143 such shares for $81.2 million.
Its bitcoin holdings fell to 842,138 BTC. At current prices, the position is valued at $52.6 billion, while $63.51 billion was spent to build it: the unrealized loss reached $10.9 billion.
Sales are no longer a one-off measure. They are embedded in the capital management framework the company unveiled in late June: the bitcoin sale cap is set at $5 billion, and securities buybacks at $1 billion with priority for STRC.
For the second quarter, Strategy posted a net loss of $8.22 billion, almost entirely from revaluing crypto assets, and said it would continue selling.
CEO Phong Le said at the time that capital raised through STRC would no longer automatically go into bitcoin. Strategy will keep the dividend rate on these shares at 12% annually until their price holds near the $100 par value.
Other corporate treasuries are taking a different tack. BitMine Immersion Technologies bought 10,399 ETH in the same week, lifting its holdings to 5.7 million coins — 4.8% of the outstanding supply of the second-largest cryptocurrency. The company values total assets at $11.3 billion.
Coldcard hack triggers audits and fresh attacks
The the July 30 theft of assets from Coldcard hardware wallets evolved over the week into a review of the entire Bitcoin infrastructure — and led to a new breach.
Losses from three confirmed attack waves were estimated by Galaxy Research at $100 million, and including a presumed fourth wave the total could reach $130 million. By the firm’s count, at least 15 different attackers exploited the vulnerability.
The incident did not trigger mass selling. Holders moved funds to new addresses rather than to exchanges, Glassnode noted. Eight on-chain indicators rose above their two-year medians, while the volume of bitcoins dormant for more than a year jumped about tenfold.
Phishing attempts also increased. On August 4, Trezor and Foundation warned of emails sent in the name of hardware makers offering an “equipment audit.”
Industry criticism focused on audit quality. Kraken CSO Nick Percoco pointed to a gap in cold storage testing: auditors verify that an approved source of randomness is present in the device, but not that the running firmware actually uses it.
Ledger CTO Charles Guillemet added that open source is not the same as reviewed code: the flaw sat in a public repository for more than five years.
The discussion quickly turned to artificial intelligence. Dragonfly managing partner Haseeb Qureshi estimated that an AI code review would have cost $2 and caught the issue. In his view, cybersecurity has become a cost question: attackers scan others’ code with AI models, and defenders have to do the same.
That approach was put into practice. The volunteer Bitcoin Red Team deployed language models on Bitcoin project codebases and in 27.5 hours filed 4,962 reports across 390 projects, classifying 85 findings as critical risk and 635 as high risk.
By August 8, the scope had nearly doubled: 7,958 reports across 501 protocols, including 168 critical and 1,120 high risk. About a quarter of vulnerabilities were reproduced with working exploits, and results for 174 projects were sent to developers.
🚩 Bitcoin Red Team Update
We’re continuing a large-scale security review of the Bitcoin open-source ecosystem.
25 Bitcoin developers around the world have been working on this task non-stop for 108 hours. pic.twitter.com/CwNXHgRmdn
— calle (@callebtc) August 8, 2026
One of the identified issues led to a new incident. Overnight on August 8, attackers drained nodes on the Lightning Network operating via the BTCPay payment server.
The bug allowed remote download of a node’s access key. Bitcoin Red Team participants warned developers, but by the time the advisory was published, the attack was underway. Users were urged to update LND to version 2.4.2 or disable the server.
Bybit sues North Korea and Lazarus Group
Crypto exchange Bybit said it filed a civil lawsuit against North Korea, its intelligence directorate, and the Lazarus Group over the theft of $1.5 billion in February 2025.
The documents were submitted under seal to the U.S. District Court for the District of Columbia on June 18 and were unsealed only in early August. In addition to the republic itself, twenty unidentified individuals and entities are named as defendants.
The exchange seeks the return of the stolen funds, about $1.5 billion in compensation, as well as punitive damages and treble damages under U.S. law against organized crime.
Less than a tenth of the funds were traced. By the time the suit was filed, 90.2% of the haul had passed through mixers, cross-chain bridges, and over-the-counter dealers and become untraceable. About $75.5 million — 5.3% of the total — was frozen or recovered.
The court allowed the exchange to expeditiously compel trading venues with U.S. infrastructure to disclose account owners’ identities, balances, and transaction histories.
Meanwhile, the scope of North Korean operations proved broader than known. Greek cybersecurity specialist Vangelis Stikas found traces of hackers linked to North Korea in the systems of 1,640 organizations across 57 countries, with serious infrastructure compromise in 700–800 cases.
The researcher gained access to several of the attackers’ command-and-control servers and examined about 5 TB of data.
Hackers primarily broke in through fake interviews, posing as recruiters for crypto and AI companies and asking candidates to run an NPM package, after which a backdoor was installed. They first looked for crypto wallets and their keys.
Most episodes have not been independently confirmed. Some named organizations reported incidents, but Coinbase and Boston Children’s Hospital found no intrusions into internal systems.
Stolen cryptocurrencies have become a revenue stream for Pyongyang. Groups linked to North Korea account for more than 70% of global crypto theft by value, up from roughly 30% in 2017, according to TRM Labs.
Also on ForkLog:
- A control fight erupted at Ondo Finance after the founder’s death
- Trump’s media company shut down its crypto arm
- The U.S. Treasury expanded sanctions against Iranian crypto exchanges
- BitMart’s founder denied allegations of misappropriating user funds
- SharpLink warned of a threat to Ethereum’s key advantage over bitcoin
- Survey: 69% of Russians found no use for cryptocurrencies
U.S. Senate pushes CLARITY Act vote to September
On August 6, the U.S. Senate declined to hold a procedural vote on the crypto market structure bill until after the August recess. The decision was confirmed by Republican majority leader John Thune.
Two days earlier, the upper chamber hit an impasse on the bill. To reach the 60-vote threshold, Republicans, who control 53 seats, need support from at least seven Democrats. The GOP also lacks internal unity: some senators object to yields on stablecoins.
A key unresolved issue is an ethics section requiring the president to divest stakes in crypto businesses. According to Bloomberg, a forced asset sale would allow Donald Trump to defer federal capital gains tax for years.
Still, it is too early to write off the bill this year. After the night session, Thune filed a motion to close debate on the measure. The first procedural vote is set for September 15 — the day after the Senate returns to Washington.
By itself this step does not mean passage; it only limits debate on moving to consideration. Without it, the CLARITY Act would likely have been dropped from the 2026 agenda.
Traders on Polymarket also turned more positive: on August 5 they put the odds of passage by year-end at 14%. The figure now stands at 21%.
Miners post losses and vie for power capacity
The largest U.S. mining company, MARA Holdings, ended the second quarter with a net loss of $611.3 million versus a $808.2 million profit a year earlier. Revenue fell 27% to $174.9 million.
The reason was the decline in bitcoin’s price. The average bitcoin price for the quarter was 28% below last year’s level, hitting mining revenues and the value of coins on the balance sheet.
Production metrics improved — output rose 3%, computing power increased 22%, and cost of production decreased.
CleanSpark posted similar results: quarterly revenue fell 30.5% to $138 million, and instead of a $257.4 million profit the company recorded a $239.8 million loss.
The industry is responding quickly. Firms have stepped up the fight for capacity: Zcash-focused Fortitude Mining acquired a 12.5 MW site in Nebraska, bringing its portfolio to 60 MW across seven locations. Earlier, MARA invested up to $600 million in a site in Matagorda County, Texas, and Hut 8 leased the second phase of the Beacon Point AI campus for $9.8 billion.
AI developers are competing with miners — often in the same areas. SpaceX and Tesla announced construction of a Terafab chip plant in Texas with initial investment of $16.8 billion. Amazon confirmed participation in a 7.65 GW gas-fired power plant project in the state — the largest in the U.S. by permitted emissions.
The state’s energy crunch has drawn official scrutiny. Governor Greg Abbott ordered an audit of data centers and paused their grid connections pending review. More than 1,800 applications totaling 474 GW are in the queue, nearly 90% of them from data centers.
For miners with already approved capacity, this is likely a win. According to Bernstein, the moratorium will hit speculative projects, and the value of sites with approved power contracts will rise — among the beneficiaries analysts named IREN and Riot Platform.
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We discussed with a lawyer what the new charge in Russia means for Pavel Durov.
We analyzed the phenomenon of China’s new Kimi K3 model from Moonshot AI and the advantages of open weights.
We looked at why Michael Burry is shorting semiconductors.
We compiled the week’s top security developments in our weekly digest.
