Bitcoin network split and lawsuit against North Korea: key events of the week in the crypto industry
The outgoing week was eventful: the leading cryptocurrency's network experienced an unexpected soft-fork split, Bybit initiated a high-profile lawsuit against North Korea, and the U.S. Senate postponed a pivotal vote on the CLARITY Act. I break down the key events that will shape the agenda for the coming months.
Bitcoin recovered to $65,000 amid institutional demand
The start of the week continued the corrective trend: on August 4, the asset dipped below $63,000. However, on-chain data pointed to a prolonged decline—analysts recorded a record-long capitulation phase. Nevertheless, the market reversed thanks to a powerful influx of institutional capital.
Spot bitcoin ETFs attracted $853 million over the week, and wallets of large holders (from 10 to 10,000 BTC) increased their positions by more than 20,000 coins since July 29. Ether funds also posted their best result since mid-April—$244 million. As a result, BTC ended the week up 3.4%, at $65,200, while Ethereum gained 3.7%. Notably, the fear and greed index remains in the "fear" zone (31 points), which often precedes sharp movements.
Bitcoin network split due to BIP-110
On August 8, a network split occurred at block #961,632. Nodes supporting BIP-110 refused to accept blocks without an approval signal, leading to the emergence of a competing branch from the Ocean pool. The main network accepted AntPool's block, while proponents of the proposal switched to the alternative. However, the separated chain mined only 2 blocks in 8 hours versus 48 for the main one—the mining difficulty makes a catch-up scenario unlikely.
Initial support for BIP-110 was minimal (2.53% against the required 55%), and developer Kevin Loak warned of the risk of losing real BTC when selling coins from the new network. This incident is an important signal of the fragility of consensus in the absence of formalized governance processes.
Bybit vs. North Korea: a legal precedent
The exchange filed a civil lawsuit in the U.S. District Court for the District of Columbia against North Korea and the Lazarus Group over the theft of $1.5 billion in February 2025. Documents sealed since June 18 were unsealed in August. The platform demands the return of funds, compensation, and treble damages. However, by the time the lawsuit was filed, 90.2% of the stolen assets had passed through mixers and become untraceable—only $75.5 million was recovered.
Meanwhile, researcher Vangelis Stikas found traces of North Korean hackers in 1,640 organizations across 57 countries. This underscores the systemic nature of the threat: North Korea accounts for over 70% of global digital asset thefts. Bybit's legal action could set a precedent, but without international coordination, fund recovery is unlikely.
Miners in the red, CLARITY Act postponed
The largest miners reported quarterly losses: MARA posted a loss of $611 million, and CleanSpark—$239.8 million. The industry is actively pivoting toward AI computing capacity, intensifying competition for electricity. The Senate postponed the vote on the CLARITY Act to September 15—odds of passage by year-end on Polymarket rose to 21%, but uncertainty persists.
My comment: The week showed that the market is in a consolidation phase with high risks. The network split and lawsuits are signs of the industry maturing, but they also remind us of the need for stricter security and regulatory standards. Institutional inflows into ETFs are a bullish signal, yet volatility will remain high until the regulatory agenda becomes clearer.