Miners have sold billions in Bitcoin to finance their shift to AI infrastructure, while neural networks have become effective tools on both sides of cyberattacks. Additionally, law enforcement in Moscow conducted searches at the Gorbushka market among other significant events from the past week.
Bitcoin Dips Back to Early August Lows
Last week marked a reversal from the July rally. On August 14, Bitcoin fell below $63,000, returning to the levels seen at the beginning of the month, despite closing the previous week at $65,200.
Early signals were more positive. On August 10, a contributor from CryptoQuant known as ShayanMarkets identified near-term resistance levels at $67,000 and $72,000, based on the realized price of short-term holders.
However, a day later, BlackRock reported a shift in investor sentiment over the past month, noting a divergence in the asset's performance compared to the stock market.
Analysts from Glassnode described the market as "compressed," with Bitcoin's price trapped between a median realized price of $63,000 and a short-term holder cost basis of $68,700. They suggested that a breach of the lower boundary could lead to a drop to $58,500.
By the end of the week, Bitcoin was stabilized around $63,000, continuing to trade near that point as of this writing. Over the past week, the asset's price decreased by 3.3%.
Hourly chart of BTC/USDT on Binance. Source: TradingView.A similar trend was observed in the Ethereum market, where the leading altcoin's price fell by 2.1% to $1,880. Among the largest cryptocurrencies by market cap, only the HYPE token from the decentralized exchange Hyperliquid showed positive movement, gaining nearly 4.7%.
Source: CoinMarketCap.Spot Bitcoin ETFs experienced their largest weekly outflow since July, totaling $398.7 million.
Source: SoSoValue.Ethereum-based ETFs reported a loss of $2.2 million, in contrast to an inflow of $244.9 million the previous week.
Source: SoSoValue.The cryptocurrency fear and greed index remains in the "fear" zone at 34 points.
Source: Alternative.me.The total market capitalization of digital assets dropped from $2.22 trillion to $2.17 trillion, with Bitcoin’s dominance at 58.8% and Ethereum’s at 10.5%.
Miners Fund AI Transition Through Bitcoin Sales
The recent sell-off of mined coins has transitioned from a crisis management strategy. In just one week, four companies redirected their earnings not to cover operational expenses but to build AI infrastructure.
Leading the charge is Keel Infrastructure, formerly Bitfarms, which on August 11 shut down all its mining operations in the U.S. to prepare sites for AI data centers and high-performance computing.
Riot Platforms completed its transition in just a few days. On August 11, the company signed a 20-year leasing contract with a "leading advanced AI laboratory" valued at $9.1 billion, reportedly with Anthropic. By August 13, the firm sold 4,300 BTC and on the 15th raised up to $573 million to construct an AI campus in Texas.
The scale of sales by the largest U.S. miner is measured in annual volumes. From January to June, Marathon Digital sold 23,093 BTC for approximately $1.6 billion, citing funding for operations, supporting growth, and managing liquidity as reasons for the sales.
On August 15, Hyperscale Data entered the fray, selling 685 BTC for $43 million to fund its own data center.
This shift is explained by mining economics; on August 12, miner revenues from fees fell to a ten-year low, while the realized hash rate of public companies, excluding Bitdeer, decreased by 21.2% over three quarters.
Mining fees revenue for Bitcoin miners. Source: Glassnode.Discussion Points with Friends
- Google and OpenAI unveil ultra-fast AI solutions
- DeepSeek releases open-source alternatives to Claude Code and the V4 Pro model
- AgiBot surpasses Unitree in the global humanoid market
- Suno imposes download limits on music
Neural Networks on Both Sides of Attacks
Last week, volunteers checking Bitcoin infrastructure with language models encountered access restrictions to tools.
Rob Hamilton, CEO of AnchorWatch, reported that on August 8 he began utilizing OpenAI's capabilities for cybersecurity within the Bitcoin Red Team but lost access the following morning. The team reverted to using Chinese models.
Such restrictions do not deter attackers. On August 10, South Korean analysts from Genians reported that a North Korea-linked group, Kimsuky, is employing local AI systems to target cryptocurrency and financial firms.
On August 13, Taiwan's Ministry of Digital Development revealed details about the breach of government institutions using AI agents.
On the same day, the founders of the non-custodial Bitcoin service Boltz handed over the project to a group of "Bitcoin veterans" following a series of attacks, which were reportedly executed using neural networks.
The July campaign against hardware wallets has wrapped up. Galaxy Research estimated that at least 1,778.84 BTC ($112.7 million) was stolen from vulnerable Coldcard devices, with no new incidents reported after August 6. The total amount fell within the lower range of analysts' previous estimates of $100-130 million.
Wallet manufacturers also suffered reputational damage. On August 13, Trezor announced a data leak affecting 13,689 users due to a breach at logistics partner ShipMonk. By the end of the week, SafePal encountered a similar issue, revealing that information on approximately 40,000 users had been compromised.
Additionally, developers of AI models have raised concerns. Anthropic discovered issues with trust, deception, and collusion among AI agent groups — the behavior of models changes when multiple agents work on a task instead of just one.
Moscow Law Enforcement Conducts Searches at Gorbushka
On the evening of August 13, law enforcement in Moscow executed mass searches at the Gorbushka shopping complex related to cryptocurrency exchanges.
This pressure on cash exchanges coincided with tighter banking compliance measures. On August 11, major Russian banks began requesting explanations from corporate clients regarding their transactions with USDT, including companies outside the experimental legal regime.
In addition to standard checks under law 115-FZ, banks require confirmation that counterparties are included in the Bank of Russia's registry of digital currency exchange operators. Such a registry does not yet exist, but the Central Bank plans to create it by fall.
Crypto expert Viktor Pershikov commented to ForkLog that these checks are not directly mandated by the regulator but stem from banks' self-insurance logic. He believes the initiative originates from Rosfinmonitoring and sees no legal risks for requirements concerning what does not yet exist — all falls within law 115-FZ.
However, this uncertainty will not last long. The "On Digital Currency and Digital Rights" law comes into effect on September 1, with a transition period until July 1, 2027. Concurrently, the State Duma is reviewing bill No. 1193493-8 regarding criminal and administrative responsibility for illegal cryptocurrency circulation with the confiscation of exchanged assets.
ForkLog also analyzed in its latest issue of "Deconstruction" what was found in Tether's reserves and the rationale behind Russian banks blocking transactions with USDT.
Concerns about risks for legal businesses were also voiced in Kyiv last week. On August 13, head of the National Securities and Stock Market Commission Alexey Semenyuk stated that cryptocurrency market regulation should protect users while maintaining profitability for companies operating legally in the country; otherwise, they will relocate abroad.
Also on ForkLog:
- WSJ reveals network of North Korean operatives in U.S. companies
- ECB: cryptocurrency payments have not gained traction in Eurozone online commerce
- U.S. to intensify cybercrime fight through business collaboration
- Media: JPMorgan halts banking services for Polymarket
- Twenty One reports a quarterly loss of $413.5 million
- Head of Etherealize calls Wall Street's closed blockchains a "race to the bottom"
- Tether undergoes first full financial audit
Institutional Investors Enter Market, Clarity Act Stalls
On August 14, Israel's largest bank announced a partnership with Galaxy Digital. Clients of Bank Leumi and its mobile unit PEPPER will now be able to trade Bitcoin, Ethereum, and Solana.
Institutional investors are following suit. Norway's sovereign wealth fund disclosed a stake in BitMine worth $81.9 million.
However, Bitcoin treasuries risk losing their place in indices. Strategy and Metaplanet may exclude them from the MSCI calculation base.
Conversely, the legislative track has slowed. On August 15, Galaxy Digital assessed the likelihood of the Clarity Act passing at 10%. A week earlier, Polymarket traders had assigned a 21% probability after the Senate postponed the first procedural vote to September 15.
Further Reading
We explored what a "reverse centaur" is and how it threatens the economy and technological progress.
We discussed how social engineering and artificial intelligence undermine decentralization.
We explained why institutional adoption has not turned the first cryptocurrency into a safe-haven asset.
In the latest edition of "Quantum & After," we calculated how many qubits are needed to crack a private key and which 6 million BTC have already had their public keys revealed on the blockchain.
Along with the ONLYP2P team, we investigated what will need to be proven to cryptocurrency sellers in Russia by 2027.
Analysts at BitOK uncovered money laundering schemes from a leading Russian-speaking darknet platform.
We compiled the most notable security events of the week in our traditional digest.