Bitcoin Tests $79K as ETF Inflows Hit $2.4B, KelpDAO Suffers $292M Hack & the Military Discovers Crypto

Crypto markets delivered another week of contradictions. Bitcoin hit a 10-week high of $79,010 on Wednesday before stalling at $77,500 as macro headwinds reasserted themselves. The ETF market posted what analysts are calling a rare “full reversal” with daily, weekly, and monthly Bitcoin ETF flows turning positive simultaneously for the first time. And then the KelpDAO bridge was exploited for $292 million, triggering $13 billion in DeFi ecosystem outflows. It was, in short, a typical week in 2026 crypto: simultaneously the most institutionally bullish and structurally dangerous market in the asset class’s history.

Market Performance: Ceasefire Rally Hits the Ceiling

The week’s dominant price catalyst was geopolitical rather than fundamental. President Trump’s decision to indefinitely extend the Iran ceasefire triggered a risk-on rally that pushed Bitcoin to $79,010 its highest level in 10 weeks on Wednesday. That move represented a decisive break out of the weeks-long consolidation range and gave technical analysts reason to believe the $80,000–$83,000 breakout zone was within reach.

It didn’t hold. Higher-than-expected Japanese inflation data and persistent jitters around the ongoing Iran conflict created a ceiling at $77,500–$78,000 that Bitcoin couldn’t clear heading into the weekly close. Traders are watching the $80,000–$83,000 range closely. A clean break and hold above this zone would confirm a fresh bullish run. A rejection here sets up a potential retracement toward $74,000–$75,000.

Ethereum cleared key resistance levels and reached approximately $2,376. This was supported by the Ethereum Foundation’s notable sale of 10,000 ETH worth approximately $23.9 million to Bitmine. In the altcoin space, Aptos (APT) and Aave (AAVE) each posted gains exceeding 3% late in the week. Aave’s performance was particularly notable given that it was simultaneously coordinating the industry response to the KelpDAO hack, that is a resilience signal worth noting.

Friday April 24 marks the monthly Bitcoin options expiry, which traditionally creates localized volatility as traders adjust or close positions. The directional resolution in the days following expiry, up through $80K or back toward $74K–$75K will set the tone for the week ahead.

The $292M KelpDAO Hack: DeFi’s Largest Exploit of 2026

On April 18, the KelpDAO bridge was exploited for approximately $292 million in rsETH, making it the largest DeFi theft of 2026 and one of the most significant bridge exploits in the sector’s history. The attack was attributed to North Korea’s Lazarus Group, the same state-sponsored threat actor responsible for multiple prior crypto thefts.

The attack vector is critically important to understand. Lazarus Group did not exploit a smart contract vulnerability. They compromised KelpDAO’s off-chain infrastructure to forge bridge approval signatures. This bypassed the on-chain validation layer entirely. No smart contract audit would have detected or prevented this breach. The vulnerability existed in the trust assumptions built into the bridge’s operational layer outside the blockchain.

The contagion was immediate: approximately $13 billion in outflows from the broader DeFi ecosystem as protocols froze markets and users withdrew funds in precaution. The industry response, however, was notable. The Arbitrum Security Council acted decisively to freeze over 30,000 ETH of the stolen funds on-chain, and Aave coordinated a rapid pause of affected markets. The episode demonstrates that while DeFi’s attack surface remains broad, the sector’s emergency response infrastructure is maturing.

Bitcoin ETFs: Every Timeframe Turns Positive Simultaneously

The ETF story this week may be the most structurally significant development of the month. Spot Bitcoin ETFs recorded eight consecutive days of net inflows as of April 23, pulling in $2.43 billion in April alone. In a rare alignment that analysts highlighted as a historically significant signal, daily, weekly, and monthly ETF flows all turned positive simultaneously.

BlackRock’s IBIT is the primary engine, accounting for approximately 75% of daily flows of $167.5 million of the $223.2 million recorded on April 23. IBIT now holds over 806,000 BTC, making it one of the largest single Bitcoin holders in the world. Zooming out, approximately 160 listed companies now hold around 1.1 million Bitcoin (5.5% of supply), and total ETF holdings represent approximately 7% of total supply.

The behavioral signal is equally important. Institutional capital has been moving opposite to retail panic. Analysts noted that ETFs absorbed nearly $1 billion in capital even during the recent 35% drawdown period. This is not trading behavior. This is long-term accumulation at scale.

Ethereum ETFs told a more complicated story. The 10-day inflow streak that was the longest since the products launched in 2024, ended abruptly on April 23 with $75.9 million in net outflows. Whether this is a one-day pause or the beginning of a rotation back toward Bitcoin-only positioning is the key question for ETH holders next week.

XRP ETFs had their best week of 2026, gaining approximately $55 million as institutional buyers returned following a difficult first quarter. The upcoming CLARITY Act resolution and the expanding altcoin ETF pipeline are the catalysts driving this renewed interest.

Goldman Sachs filed for a Bitcoin income-generation ETF this week, while Morgan Stanley launched its own MSBT fund with a 14 bps fee, representing further evidence that every major traditional finance institution is now actively building in the Bitcoin ETF space.

Institutional Accumulation: The Pace Is Accelerating

Strategy (formerly MicroStrategy) disclosed on April 20 that it purchased 34,164 BTC worth approximately $2.54 billion during the week ending April 19. Strategy’s total Bitcoin holdings now stand at 815,061 BTC, representing nearly 4% of the entire Bitcoin supply. Japan’s Metaplanet raised $50 million specifically to acquire more Bitcoin, reinforcing the corporate treasury adoption trend that began in earnest after the GENIUS and CLARITY Acts passed in late 2025.

The most symbolically significant institutional signal of the week, however, came from outside the finance sector entirely. US Indo-Pacific Commander Admiral Samuel Paparo told Congress that Bitcoin has “incredible potential” as a strategic tool in competition with China. When a senior military commander testifies to Congress about the strategic value of Bitcoin, the institutional adoption narrative has moved well beyond asset management into questions of national security and geopolitical strategy.

Regulatory Developments: Fed, UK & Prediction Market Battles

The U.S. Department of Justice dropped its probe into Federal Reserve Chair Jerome Powell this week. This development has indirect but potentially significant implications for crypto. This clears a potential path for Kevin Warsh to succeed Powell, and Warsh is widely viewed as more crypto-friendly than the current Fed leadership. Separately, Morgan Stanley launched a new fund specifically designed to manage reserves for stablecoin issuers in alignment with new GENIUS Act requirements.

In the UK, HM Treasury published a draft Statutory Instrument on April 21 introducing targeted amendments to the Cryptoassets Regulations 2026. Key changes include a carve-out for UK-issued qualifying stablecoin (UKQS) payments from dual authorisation requirements, financial promotions relief for UKQS transactions, a proprietary trading exemption for UK market makers, and an extension of safeguarding rules to cover tokenised securities. The full UK crypto regulatory regime is set to commence on October 25, 2027, with the FCA application gateway opening September 30, 2026.

Wisconsin this week joined New York in filing lawsuits against major platforms including Coinbase, Polymarket, and Robinhood, alleging that prediction market contracts constitute illegal gambling. The federal-versus-state jurisdiction battle that New York’s lawsuit opened is now widening into a multi-state legal challenge. Quantum security also appeared in the news as a researcher won a 1-BTC bounty after successfully demonstrating a quantum attack on a 15-bit elliptic curve key, a limited but symbolically significant proof of concept. AWS Marketplace added Chainlink data standards, allowing developers to more easily integrate traditional computing with blockchain networks.

Key Levels & What to Watch Next

Bitcoin’s resolution from the April 24 options expiry will set the near-term direction. The bull case requires a clean break above $80,000 and confirmation above $83,000. The bear case is a rejection here and a retracement toward the $74,000–$75,000 support range. The neutral case which is the most likely, is continued volatility without sustained trend in either direction until the FOMC meeting delivers its verdict on April 28–29.

Watch specifically for Powell’s language on the neutral rate at the FOMC meeting. A dovish signal opens the path to $80,000+. A hawkish tone risks a retest of $67,000.

Final Verdict