Bitcoin's biggest weekly gain ever
The crypto market has changed significantly in a short period of time. After months dominated by the bear market, investors are cautiously looking forward once more. Is this just a strong rebound, or are we at the beginning of a new phase? For Strategy, at least, a new period seems to have begun, as the company is transforming from a passive buyer into an active asset manager. You can find more about this in this edition of Bitvavo’s Market News.
Market update
In the week from August 16 to 23, Bitcoin rose by 23% from €54,300 to €66,500. In percentage terms, this is the largest gain since March 2023, when Bitcoin jumped from €20,700 to €26,200 in one week after the collapse of Silicon Valley Bank. In euros, the weekly increase of over €12,000 is the largest ever.
In the following days, Bitcoin held up well, gradually climbing to a peak of €69,900. That puts it well above the 200-day average and the volume-weighted average price (VWAP) from the peak of the previous bull market, marking a serious challenge to the bear market's downtrend.
But we're not there yet. Bitcoin is still below the €70,300 level of May 6, the previous high on the weekly chart. We have also not yet seen a weekly close above the 50-week average, currently at €69,700. With a convincing breakout above these prices, most investors will treat the market as an early new bull market.
Until then, a drop back to the bear market's provisional low of €50,600 on July 1 remains a plausible scenario. But whether we have seen the bear market's lowest point or not, there are clear signs that its downward trend is ending.
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Will Strategy buy the price dips?
Last week, Strategy raised approximately 2 billion dollars, but did not use the money to buy Bitcoin. Part of the funds raised went into the existing dollar reserve, and another portion into a new pool of freely available cash. Michael Saylor appears to be signalling that he wants to transform Strategy from a mechanical bitcoin buyer to an active asset manager.
The dollar reserve has been in place since December 2025 and is intended to pay interest on debt and dividends on preferred shares. At the beginning of this year, it contained enough to cover over two years of obligations. However, in May, Strategy used approximately two-thirds to pay off a loan, leaving roughly 800 million dollars, enough for just six months or so.
That only fuelled the very doubts the reserve was intended to dispel: could Strategy withstand a prolonged bear market without major problems?
Since then, the reserve has been substantially replenished. Furthermore, the reserve may now only be used for interest and dividends and must contain at least twelve months of coverage. It currently holds around $5 billion, enough to cover more than three years.
Saylor has also created a second pool called ‘USD Cash’. This 1.5 billion dollar cash reserve is much more versatile; Strategy can use it to buy Bitcoin, pay off debts, repurchase its own shares, or top up its regular dollar reserve.
This flexibility suggests a change in strategy. For years, Saylor said he could not time the market, so after Strategy raised capital, a Bitcoin purchase usually followed quickly. "I’m going to be buying the top forever" was one of his best-known sayings.
Strategy now talks of dynamic capital allocation. Depending on market conditions, the company can raise capital, buy or sell bitcoin, and repurchase its own securities. The new cash reserve gives it the flexibility to do so; for example, if Bitcoin were to suddenly drop by 15%, Saylor would no longer need to raise fresh capital before taking advantage of the dip.
This has largely alleviated the concerns that surrounded Strategy a few months ago. With over 6.5 billion dollars in cash, the company now holds almost as many dollars as it has in debt. You could say that, for the time being, leverage has effectively disappeared from the company.
That makes the next major correction particularly interesting. Will Saylor indeed be ready to buy the dip?
In other news
U.S. campaign explains Bitcoin to a broad audience. Under the banner “It’s time to take Bitcoin seriously,” six essays by people like Lyn Alden, Alex Gladstein, and Adam Back are appearing, supported by six full-page and 24 smaller newspaper advertisements. The first advertisement appeared in The Wall Street Journal. The campaign, organized by The Nakamoto Project, relies on two properties that make Bitcoin unique: its supply cannot be increased, and it allows people to exchange value directly.
CFTC Chairman puts pressure on the Senate to pass the Clarity Act. If Democrats continue to block the legislation, the regulator will start drafting rules for crypto markets itself. Employees are already exploring how derivatives exchanges and on-chain protocols can operate legally in the U.S. The CFTC is specifically looking at trading platforms that currently avoid the U.S. or operate in a regulatory gray area, such as Hyperliquid. The regulator's message is clear: if the Senate does not act, the CFTC will. One way or another, ‘Clarity’ will come.
Stablecoins are increasingly embedded in the financial system. The British government now wants to make the Bank of England responsible for innovation in digital money. In South Korea, Visa will experiment with stablecoins for international payments, in collaboration with a bank and a crypto exchange. At the same time, according to The Wall Street Journal, over twelve major banks, including Bank of America, are working on a joint stablecoin. Banks are no longer pushing back against stablecoins, but have become active developers themselves.
Kalshi risks becoming caught up in conflicting U.S. regulations. Last week, a judge ruled that Nevada may treat the prediction platform's sports contracts as gambling. Another court previously ruled that the same product falls under federal financial oversight, meaning New Jersey cannot intervene. The result is that the same product could have a different legal status from one state to another. The rulings are not yet final, but they increase the likelihood that the U.S. Supreme Court will ultimately have to determine how Kalshi may operate.
Satoshi Radio: In the latest episode of Satoshi Radio, the hosts discuss the spectacular rise of bitcoin. The chart saw the largest green weekly candle ever. So is the bear market behind us? There's also coverage of Strategy's multi-billion-dollar reserve and of US regulators urging politicians to take action. As usual, the episode closes with a market update
This article is for informational purposes only and does not constitute a marketing communication or recommendation. None of the content herein should be considered as investment advice or a substitute for it. Bitvavo makes no guarantees regarding the accuracy or completeness of the provided information. Investments involve risks. There is a possibility of losing your entire invested capital.