Bitcoin breaks through $79,000, Ethereum prepares for tectonic shifts: main events of the week
The outgoing week proved truly landmark for the cryptocurrency market. Bitcoin not only updated local highs but also demonstrated strength capable of shifting the balance of power in the industry. Meanwhile, the Ethereum Foundation is preparing the community for potentially painful consequences of the upcoming upgrade, and U.S. regulators continue to build a new architecture for controlling digital assets. I break down the key events while they are still fresh.
Bullish breakout: Bitcoin ignores the bears
The market started the week with a powerful signal. As early as August 17, the leading cryptocurrency outpaced stock indices in terms of momentum, which drew analysts' attention. Glassnode data confirmed that over the past three months, Bitcoin outperformed the S&P 500 in only a third of trading sessions, pointing to the accumulation of hidden momentum. CryptoQuant analysts, in turn, recorded the return of spot demand — a classic sign that the bearish phase is coming to an end.
The climax came on August 20. Within 24 hours, prices jumped nearly 8%, breaking through the $70,000 level for the first time in 11 weeks. But that was only a prelude. Digital gold continued its rally and easily surpassed the $79,000 mark, reaching $79,500 on Binance — the last time such prices were recorded was in mid-May.
This move was fueled by a massive short squeeze. In the first 24 hours, nearly $3 billion in positions were forcibly closed, of which $2.7 billion were shorts. The next day, liquidations totaled $1.25 billion and $1 billion, respectively. Clearly, the overheated derivatives market triggered a cascade of short position closures, with the trigger being the U.S. Treasury's announcement of plans to double the volume of Treasury bond buybacks as part of liquidity support.
After such aggressive growth, Bitcoin moved into consolidation, holding above $77,000. The week's result is impressive: +22.5% for BTC. Altcoins showed even stronger momentum: Ethereum gained 29.3%, XRP rose 50%, and HYPE and Dogecoin added 41.3% and 32%, respectively. Institutional investors also stepped up: spot Bitcoin ETFs recorded weekly inflows of $1.92 billion — the highest since October 2025. Ethereum funds attracted $697 million, also setting a record.
The Fear and Greed Index surged from 34 to 71 points before cooling slightly to 66. Market capitalization grew from $2.17 trillion to $2.62 trillion. Bitcoin dominance stood at 59.2%, while Ethereum's share rose to 11.2%.
Ethereum Foundation warns: Glamsterdam upgrade could break wallets
Amid the overall optimism, the Ethereum Foundation (EF) issued an alarming warning. The upcoming Glamsterdam upgrade will change the network's gas model, and some software risks failing. According to developers, wallets, indexers, and fee estimation tools will be affected. Particular attention should be paid to software with a "hardcoded maximum gas limit" — such solutions will simply stop working.
The issue lies in EIP-8037, which adds a separate state-gas dimension for operations that create new state. A simple transfer of ETH to an existing address will retain the cost of 21,000 units, but sending to a new address will incur an additional charge. Developers are strongly advised to review smart contracts that rely on outdated fee calculation logic and test their systems on the public Plataberget testnet. This is a critical step for those who do not want to face unpleasant surprises after the upgrade is activated.
Regulatory storm: GENIUS Act and new SEC rules
The United States continues to shape the legal framework for the crypto industry. The U.S. Treasury presented a draft of rules for implementing the GENIUS Act — the first federal law on payment stablecoins. The document defines strict requirements for issuers and reserves: stablecoins must be backed one-to-one by highly liquid assets, including dollars, bank deposits, and short-term Treasury bonds. Regular disclosures and independent audits are also required.
In parallel, the SEC proposed new rules for the crypto market under Regulation Crypto Assets. The initiative simplifies capital raising through tokens: the first exemption would allow raising up to $5 million over four years, the second — up to $75 million per 12-month period. A "safe harbor" for investment contracts is also proposed, which could remove certain assets from the scope of securities laws. SEC Chairman Paul Atkins emphasized that these rules will not replace Congress's legislative framework but will create a more sustainable foundation for the market.
Solana speeds up: slot time reduced to 350 ms
The Solana team activated the first stage of reducing slot time from 400 to 350 ms on the mainnet as part of SIMD-0525. This is the first reduction in slot length since the network's launch. Validators on the Agave v4.2 client have already activated the upgrade. Plans include sequential reductions to 300, 250, and 200 ms. Each stage will be activated in a separate epoch (approximately two to three days), and the schedule allows stopping the process if the share of missed blocks increases. This is a significant step toward improving network throughput.
My comment: The market has clearly entered a phase of aggressive recovery, but it should not be forgotten that the driving force was a short squeeze, not organic inflows of new funds. A correction after such impulses is a normal phenomenon. However, the combination of growing institutional demand through ETFs and regulators' readiness for dialogue creates a solid foundation for a long-term bullish trend. At the same time, the EF warning is a reminder that infrastructural changes can carry hidden risks even during periods of euphoria.