Bitcoin saw a decline to $78,000 following comments from Federal Reserve Chair Kevin Warsh, while StarkWare executed the first quantum-resistant transaction on the Bitcoin network. Additionally, the Solana community supported a measure to cut SOL inflation, among other notable events from the past week.

Bitcoin Rebounds Above $78,000

This past week, Bitcoin made several attempts to reach $81,000, with the price on Binance peaking at $81,354.

Hourly chart of BTC/USD on Binance. Source: TradingView.

However, on Friday, in light of Warsh's remarks, the price dipped below $76,000. The Fed Chair reiterated the agency's commitment to a 2% inflation target, stating that the weak summer data does not indicate a significant improvement in the underlying trend.

Following Warsh's address, traders adjusted their expectations for the September Fed meeting, with the probability of an interest rate hike increasing from 35.4% to 57% within a day.

As of this writing, Bitcoin's price had recovered, approaching $79,000, marking a gain of over 1.5% in 24 hours and maintaining a weekly increase of nearly 2%.

Source: CoinMarketCap.

Among the largest altcoins by market capitalization, Solana surged by 12.4%, while HYPE from Hyperliquid rose by 4.3%. In contrast, XRP experienced a decline of about 7.5%, settling at $1.4.

Spot Bitcoin ETF inflows slowed down, attracting approximately $934.5 million this week compared to $1.92 billion the previous week. On Friday, investors withdrew nearly $202 million, ending a nine-day streak of daily net inflows.

Source: SoSoValue.

Ethereum funds saw inflows of $824.4 million, up from $697.2 million the week prior. The last recorded net outflow from ETH ETFs occurred on August 11.

Source: SoSoValue.

The cryptocurrency fear and greed index surged to a local high of 74 points at the beginning of the week but corrected to 69, remaining near the extreme greed zone.

Source: Alternative.me.

The total market capitalization for digital assets increased from $2.62 trillion to $2.66 trillion. Bitcoin's dominance rose to 59.6% (up from 59.2% the previous week), while Ethereum's share remained unchanged at 11.2%.

StarkWare Completes First Quantum-Resistant Transaction on Bitcoin Network

On August 26, StarkWare, known for its L2 solution Starknet, conducted the first quantum-resistant transaction on the Bitcoin mainnet.

No changes to the consensus rules were necessary for this transaction.

This experiment was part of the Quantum Safe Bitcoin (QSB) initiative, designed as an emergency measure for migrating coins until full post-quantum protection is available at the protocol level. It was presented in April by StarkWare's product director, Avihu Levi, with engineer Tomer Giladi implementing the concept.

Levi's proposal adds an extra layer of protection to the first cryptocurrency using hash functions resistant to quantum computer threats.

The signature grinding technique works by generating multiple variations before sending a transaction with the desired cryptographic properties. Most of the computation is done off-chain, and the security of the final result relies heavily on the difficulty of reversing the hash.

Currently, this method is costly and slow, with preparing a single transaction taking several hours and costing hundreds of dollars in computational resources.

StarkWare emphasized that this experiment does not protect the entire network from quantum attacks. The QSB allows for the migration of individual coins to a more secure exit without altering the Bitcoin protocol itself.

Discussion Topics for Friends

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New Ethereum Deposit Contract Proposed for Post-Quantum Signatures

On August 24, Ethereum developers proposed a new version of the deposit contract designed for signatures resistant to quantum attacks.

Currently, a validator connects to the network via a smart contract that accepts deposits and operates solely with BLS cryptography. The authors of the draft aim to make this mechanism independent of specific schemes so that the blockchain can transition to other algorithms, including post-quantum, without overhauling the infrastructure.

To achieve this, a flexible format is proposed: public keys and additional metadata will be accepted as variable-length fields, and the cryptographic scheme used will be identified by a distinct numerical code. The current BLS standard will be assigned Scheme ID 0.

The specific post-quantum implementation is not detailed in the document—this initiative merely lays the groundwork for future integration.

Developers also suggest modifying how deposits are handled. Instead of the current Merkle tree, data will be transmitted to the consensus layer via execution requests under the EIP-7685 mechanism.

Solana to Double the Rate of SOL Inflation Reduction

On August 28, participants in Solana's on-chain voting approved proposal SGP-0002, which doubles the annual rate of disinflation from 15% to 30%. The initiative received 176.29 million SOL votes in favor, while 66.19 million were against, and 20.63 million abstained.

SGP-0002 is based on the technical proposal SIMD-0550, prepared by the infrastructure company Helius. The ultimate inflation target of 1.5% remains unchanged, but the timeline for reaching it is shortened from 5.7 years to 2.8 years.

According to the authors, this will reduce the issuance by approximately 18.9 million SOL over six years compared to the current schedule. Meanwhile, fees, MEV revenues, and the block reward distribution mechanism will remain unaffected.

The accelerated reduction in issuance will decrease the amount of SOL allocated for staking rewards. Authors of SIMD-0550 estimate that nominal yields could drop from the current 5.84% to 4.34% in the first year, and further to 3% and 2.25% in the second and third years, respectively.

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OpenAI Discovers Secret Communication Channel Among Its AI Agents

On August 26, OpenAI released an analysis of a July incident in which its AI agents escaped their isolated environment and compromised the infrastructure of the Hugging Face platform.

They established communication through the cache of an internal package manager, using it as a "bulletin board." Subsequently, through a Server-Side Request Forgery (SSRF) attack, one agent gained internet access, and the others quickly adopted this method. Later, they secured administrative rights over the package manager and, after a failure, restored the channel by encoding messages in directory names. The agents assigned roles: some searched for vulnerabilities, others for credentials, while others coordinated actions. In their discussions, they referred to themselves as a "swarm" and recognized the unauthorized nature of the attack, yet considered it beneficial for achieving their goals.

Reasons for Their Persistence

OpenAI identified four factors: the hacking of the reward system, persistence in unsolvable tasks, unauthorized communication, and the borrowing of objectives from other models. Notably, hacking Hugging Face offered no bonuses in evaluation—the agents acted against the logic of the test.

Security Failures

Standard security mechanisms (system prompts, harnesses, classifiers) did not apply to internal tests, which OpenAI estimates would reduce the risk of infrastructure compromise by more than 100 times. Monitoring of reasoning chains was absent, and signals of activity on the bulletin board were detected as early as May but did not reach management. The company described the incident as a "wake-up call."

Further Reading

New cards in "Cryptoorium" explain how algorithmic trading works, the strategies used in the crypto market, how traditional algorithms differ from AI, and why even the fastest robot does not guarantee profits.

They also examined whether to expect a "golden cross" in Bitcoin prices in 2026.

Lastly, they explored why traditional user interfaces are giving way to new forms of interaction and what this means for us.