diff --git a/alethzero/MainWin.cpp b/alethzero/MainWin.cpp
index 3a1a22165..4ec917bca 100644
--- a/alethzero/MainWin.cpp
+++ b/alethzero/MainWin.cpp
@@ -976,7 +976,7 @@ void Main::refreshBlockChain()
 		auto b = bc.block(h);
 		for (auto const& i: RLP(b)[1])
 		{
-			Transaction t(i[0].data());
+			Transaction t(i.data());
 			if (bm || transactionMatch(filter, t))
 			{
 				QString s = t.receiveAddress ?
@@ -1236,13 +1236,13 @@ void Main::on_blocks_currentItemChanged()
 			else
 				s << "<br/>Pre: <i>Nothing is before the Gensesis</i>";
 			for (auto const& i: block[1])
-				s << "<br/>" << sha3(i[0].data()).abridged() << ": <b>" << i[1].toHash<h256>() << "</b> [<b>" << i[2].toInt<u256>() << "</b> used]";
+				s << "<br/>" << sha3(i.data()).abridged();// << ": <b>" << i[1].toHash<h256>() << "</b> [<b>" << i[2].toInt<u256>() << "</b> used]";
 			s << "<br/>Post: <b>" << info.stateRoot << "</b>";
 		}
 		else
 		{
 			unsigned txi = item->data(Qt::UserRole + 1).toInt();
-			Transaction tx(block[1][txi][0].data());
+			Transaction tx(block[1][txi].data());
 			auto ss = tx.safeSender();
 			h256 th = sha3(rlpList(ss, tx.nonce));
 			s << "<h3>" << th << "</h3>";
diff --git a/astylerc b/astylerc
index 0b407b9fe..d4e1188eb 100644
--- a/astylerc
+++ b/astylerc
@@ -6,6 +6,6 @@ min-conditional-indent=1
 pad-oper
 pad-header
 unpad-paren
-delete-empty-lines
 align-pointer=type
-
+keep-one-line-blocks
+close-templates
diff --git a/libdevcore/Common.cpp b/libdevcore/Common.cpp
index a32125354..9d2ae55d7 100644
--- a/libdevcore/Common.cpp
+++ b/libdevcore/Common.cpp
@@ -27,7 +27,7 @@ using namespace dev;
 namespace dev
 {
 
-char const* Version = "0.7.7";
+char const* Version = "0.7.8";
 
 }
 
diff --git a/libethcore/CommonEth.cpp b/libethcore/CommonEth.cpp
index 44ebe19c5..e7223d896 100644
--- a/libethcore/CommonEth.cpp
+++ b/libethcore/CommonEth.cpp
@@ -34,7 +34,7 @@ namespace dev
 namespace eth
 {
 
-const unsigned c_protocolVersion = 37;
+const unsigned c_protocolVersion = 38;
 const unsigned c_databaseVersion = 3;
 
 static const vector<pair<u256, string>> g_units =
diff --git a/libethereum/AddressState.h b/libethereum/AddressState.h
index 668e9225f..8b4505909 100644
--- a/libethereum/AddressState.h
+++ b/libethereum/AddressState.h
@@ -23,6 +23,7 @@
 
 #include <libdevcore/Common.h>
 #include <libdevcore/RLP.h>
+#include <libdevcrypto/TrieDB.h>
 #include <libdevcrypto/SHA3.h>
 
 namespace dev
@@ -35,10 +36,19 @@ namespace eth
 class AddressState
 {
 public:
-	AddressState(): m_isAlive(false), m_nonce(0), m_balance(0) {}
+	enum NewAccountType { NormalCreation, ContractConception };
+
+	/// Construct a dead AddressState.
+	AddressState() {}
+	/// Construct an alive AddressState, with given endowment, for either a normal (non-contract) account or for a contract account in the
+	/// conception phase, where the code is not yet known.
+	AddressState(u256 _balance, NewAccountType _t): m_isAlive(true), m_balance(_balance), m_codeHash(_t == NormalCreation ? h256() : EmptySHA3) {}
+	/// Explicit constructor for wierd cases of construction of a normal account.
+	AddressState(u256 _nonce, u256 _balance): m_isAlive(true), m_nonce(_nonce), m_balance(_balance) {}
+	/// Explicit constructor for wierd cases of construction or a contract account.
 	AddressState(u256 _nonce, u256 _balance, h256 _contractRoot, h256 _codeHash): m_isAlive(true), m_nonce(_nonce), m_balance(_balance), m_storageRoot(_contractRoot), m_codeHash(_codeHash) {}
 
-	void kill() { m_isAlive = false; m_storageOverlay.clear(); m_codeHash = EmptySHA3; m_storageRoot = h256(); m_balance = 0; m_nonce = 0; }
+	void kill() { m_isAlive = false; m_storageOverlay.clear(); m_codeHash = EmptySHA3; m_storageRoot = EmptyTrie; m_balance = 0; m_nonce = 0; }
 	bool isAlive() const { return m_isAlive; }
 
 	u256& balance() { return m_balance; }
@@ -62,17 +72,17 @@ public:
 	void noteCode(bytesConstRef _code) { assert(sha3(_code) == m_codeHash); m_codeCache = _code.toBytes(); }
 
 private:
-	bool m_isAlive;
-	u256 m_nonce;
-	u256 m_balance;
+	bool m_isAlive = false;
+	u256 m_nonce = 0;
+	u256 m_balance = 0;
 
 	/// The base storage root. Used with the state DB to give a base to the storage. m_storageOverlay is overlaid on this and takes precedence for all values set.
-	h256 m_storageRoot;
+	h256 m_storageRoot = EmptyTrie;
 
 	/// If 0 then we're in the limbo where we're running the initialisation code. We expect a setCode() at some point later.
 	/// If EmptySHA3, then m_code, which should be empty, is valid.
 	/// If anything else, then m_code is valid iff it's not empty, otherwise, State::ensureCached() needs to be called with the correct args.
-	h256 m_codeHash;
+	h256 m_codeHash = EmptySHA3;
 
 	// TODO: change to unordered_map.
 	std::map<u256, u256> m_storageOverlay;
diff --git a/libethereum/BlockChain.cpp b/libethereum/BlockChain.cpp
index a9bdbf247..9672f722c 100644
--- a/libethereum/BlockChain.cpp
+++ b/libethereum/BlockChain.cpp
@@ -67,7 +67,7 @@ std::map<Address, AddressState> const& dev::eth::genesisState()
 			"6c386a4b26f73c802f34673f7248bb118f97424a",
 			"e4157b34ea9615cfbde6b4fda419828124b70c78"
 		}))
-			s_ret[Address(fromHex(i))] = AddressState(0, u256(1) << 200, h256(), EmptySHA3);
+			s_ret[Address(fromHex(i))] = AddressState(u256(1) << 200, AddressState::NormalCreation);
 	return s_ret;
 }
 
diff --git a/libethereum/Executive.cpp b/libethereum/Executive.cpp
index 5a983b66e..8f52b4c36 100644
--- a/libethereum/Executive.cpp
+++ b/libethereum/Executive.cpp
@@ -138,7 +138,7 @@ bool Executive::create(Address _sender, u256 _endowment, u256 _gasPrice, u256 _g
 	m_newAddress = right160(sha3(rlpList(_sender, m_s.transactionsFrom(_sender) - 1)));
 
 	// Set up new account...
-	m_s.m_cache[m_newAddress] = AddressState(0, m_s.balance(m_newAddress) + _endowment, h256(), h256());
+	m_s.m_cache[m_newAddress] = AddressState(0, m_s.balance(m_newAddress) + _endowment, EmptyTrie, h256());
 
 	// Execute _init.
 	m_vm = new VM(_gas);
diff --git a/libethereum/State.cpp b/libethereum/State.cpp
index 11400b755..183b2b8de 100644
--- a/libethereum/State.cpp
+++ b/libethereum/State.cpp
@@ -324,6 +324,9 @@ StateDiff State::diff(State const& _c) const
 	for (auto i: _c.m_cache)
 		ads.insert(i.first);
 
+	cnote << *this;
+	cnote << _c;
+
 	for (auto i: ads)
 	{
 		auto it = m_cache.find(i);
@@ -355,7 +358,7 @@ void State::ensureCached(std::map<Address, AddressState>& _cache, Address _a, bo
 		RLP state(stateBack);
 		AddressState s;
 		if (state.isNull())
-			s = AddressState(0, 0, EmptyTrie, EmptySHA3);
+			s = AddressState(0, AddressState::NormalCreation);
 		else
 			s = AddressState(state[0].toInt<u256>(), state[1].toInt<u256>(), state[2].toHash<h256>(), state[3].toHash<h256>());
 		bool ok;
@@ -622,8 +625,6 @@ u256 State::enact(bytesConstRef _block, BlockChain const* _bc, bool _checkNonce)
 		RLPStream k;
 		k << i;
 
-		RLPStream txrlp;
-		m_transactions[i].streamRLP(txrlp);
 		transactionsTrie.insert(&k.out(), tr.data());
 
 //		cnote << m_state.root() << m_state;
@@ -960,8 +961,12 @@ void State::noteSending(Address _id)
 {
 	ensureCached(_id, false, false);
 	auto it = m_cache.find(_id);
-	if (it == m_cache.end())
-		m_cache[_id] = AddressState(1, 0, h256(), EmptySHA3);
+	if (asserts(it != m_cache.end()))
+	{
+		cwarn << "Sending from non-existant account. How did it pay!?!";
+		// this is impossible. but we'll continue regardless...
+		m_cache[_id] = AddressState(1, 0);
+	}
 	else
 		it->second.incNonce();
 }
@@ -971,7 +976,7 @@ void State::addBalance(Address _id, u256 _amount)
 	ensureCached(_id, false, false);
 	auto it = m_cache.find(_id);
 	if (it == m_cache.end())
-		m_cache[_id] = AddressState(0, _amount, h256(), EmptySHA3);
+		m_cache[_id] = AddressState(_amount, AddressState::NormalCreation);
 	else
 		it->second.addBalance(_amount);
 }
@@ -1084,7 +1089,7 @@ bool State::isTrieGood(bool _enforceRefs, bool _requireNoLeftOvers) const
 				RLP r(i.second);
 				TrieDB<h256, OverlayDB> storageDB(const_cast<OverlayDB*>(&m_db), r[2].toHash<h256>());	// promise not to alter OverlayDB.
 				for (auto const& j: storageDB) { (void)j; }
-				if (!e && r[3].toHash<h256>() && m_db.lookup(r[3].toHash<h256>()).empty())
+				if (!e && r[3].toHash<h256>() != EmptySHA3 && m_db.lookup(r[3].toHash<h256>()).empty())
 					return false;
 			}
 		}
@@ -1262,7 +1267,7 @@ h160 State::create(Address _sender, u256 _endowment, u256 _gasPrice, u256* _gas,
 	Address newAddress = right160(sha3(rlpList(_sender, transactionsFrom(_sender) - 1)));
 
 	// Set up new account...
-	m_cache[newAddress] = AddressState(0, balance(newAddress) + _endowment, h256(), h256());
+	m_cache[newAddress] = AddressState(balance(newAddress) + _endowment, AddressState::ContractConception);
 
 	// Execute init code.
 	VM vm(*_gas);
@@ -1376,7 +1381,6 @@ std::ostream& dev::eth::operator<<(std::ostream& _out, State const& _s)
 
 			stringstream contout;
 
-			/// For POC6, 3rd value of account is code and will be empty if code is not present.
 			if ((cache && cache->codeBearing()) || (!cache && r && !r[3].isEmpty()))
 			{
 				std::map<u256, u256> mem;
diff --git a/libethereum/State.h b/libethereum/State.h
index b32bb6c7c..a90812880 100644
--- a/libethereum/State.h
+++ b/libethereum/State.h
@@ -376,7 +376,10 @@ void commit(std::map<Address, AddressState> const& _cache, DB& _db, TrieDB<Addre
 			s << i.second.nonce() << i.second.balance();
 
 			if (i.second.storage().empty())
-				s.append(i.second.baseRoot(), false, true);
+			{
+				assert(i.second.baseRoot());
+				s.append(i.second.baseRoot());
+			}
 			else
 			{
 				TrieDB<h256, DB> storageDB(&_db, i.second.baseRoot());
@@ -385,7 +388,8 @@ void commit(std::map<Address, AddressState> const& _cache, DB& _db, TrieDB<Addre
 						storageDB.insert(j.first, rlp(j.second));
 					else
 						storageDB.remove(j.first);
-				s.append(storageDB.root(), false, true);
+				assert(storageDB.root());
+				s.append(storageDB.root());
 			}
 
 			if (i.second.isFreshCode())
diff --git a/libevm/VM.h b/libevm/VM.h
index 774667902..e2f4ff5dd 100644
--- a/libevm/VM.h
+++ b/libevm/VM.h
@@ -448,16 +448,18 @@ template <class Ext> dev::bytesConstRef dev::eth::VM::go(Ext& _ext, OnOpFunc con
 			m_stack.pop_back();
 			break;
 		case Instruction::SIGNEXTEND:
-		{
-			unsigned k = m_stack.back();
+			if (m_stack.back() < 31)
+			{
+				unsigned const testBit(m_stack.back() * 8 + 7);
+				u256& number = m_stack[m_stack.size() - 2];
+				u256 mask = ((u256(1) << testBit) - 1);
+				if (boost::multiprecision::bit_test(number, testBit))
+					number |= ~mask;
+				else
+					number &= mask;
+			}
 			m_stack.pop_back();
-			auto& b = m_stack.back();
-			if (k <= 31)
-				if ((b >> (k * 8)) & 0x80)
-					for (int i = 31; i > k; --i)
-						b |= (u256(0xff) << i);
 			break;
-		}
 		case Instruction::SHA3:
 		{
 			unsigned inOff = (unsigned)m_stack.back();
diff --git a/liblll/Assembly.cpp b/liblll/Assembly.cpp
index 5b10138d1..7ad84682f 100644
--- a/liblll/Assembly.cpp
+++ b/liblll/Assembly.cpp
@@ -54,6 +54,7 @@ unsigned Assembly::bytesRequired() const
 			switch (i.m_type)
 			{
 			case Operation:
+			case Tag: // 1 byte for the JUMPDEST
 				ret++;
 				break;
 			case PushString:
@@ -69,7 +70,6 @@ unsigned Assembly::bytesRequired() const
 			case PushData:
 			case PushSub:
 				ret += 1 + br;
-			case Tag:;
 			default:;
 			}
 		if (dev::bytesRequired(ret) <= br)
diff --git a/libsolidity/Parser.cpp b/libsolidity/Parser.cpp
index 1ea413ee9..44f0a54ad 100644
--- a/libsolidity/Parser.cpp
+++ b/libsolidity/Parser.cpp
@@ -266,9 +266,11 @@ ASTPointer<Statement> Parser::parseStatement()
 		// starting from here, all statements must be terminated by a semicolon
 	case Token::CONTINUE:
 		statement = ASTNodeFactory(*this).createNode<Continue>();
+		m_scanner->next();
 		break;
 	case Token::BREAK:
 		statement = ASTNodeFactory(*this).createNode<Break>();
+		m_scanner->next();
 		break;
 	case Token::RETURN:
 	{
diff --git a/test/solidityParser.cpp b/test/solidityParser.cpp
index 025cd74d1..701a6e76c 100644
--- a/test/solidityParser.cpp
+++ b/test/solidityParser.cpp
@@ -185,7 +185,7 @@ BOOST_AUTO_TEST_CASE(while_loop)
 {
 	char const* text = "contract test {\n"
 					   "  function fun(uint256 a) {\n"
-					   "    uint256 x = (1 + 4).member(++67) || true;\n"
+					   "    while (true) { uint256 x = 1; break; continue; } x = 9;\n"
 					   "  }\n"
 					   "}\n";
 	BOOST_CHECK_NO_THROW(parseText(text));
diff --git a/test/vm.cpp b/test/vm.cpp
index d69f03fda..76ed41a44 100644
--- a/test/vm.cpp
+++ b/test/vm.cpp
@@ -130,7 +130,7 @@ bool FakeExtVM::call(Address _receiveAddress, u256 _value, bytesConstRef _data,
 
 		m_ms.internal.resize(m_ms.internal.size() + 1);
 
-		auto ret = m_s.call(_receiveAddress,_codeAddressOverride ? _codeAddressOverride : _receiveAddress, _myAddressOverride ? _myAddressOverride : myAddress, _value, gasPrice, _data, _gas, _out, origin, &sub, &(m_ms.internal.back()), simpleTrace<ExtVM>(), 1);
+		auto ret = m_s.call(_receiveAddress,_codeAddressOverride ? _codeAddressOverride : _receiveAddress, _myAddressOverride ? _myAddressOverride : myAddress, _value, gasPrice, _data, _gas, _out, origin, &sub, &(m_ms.internal.back()), Executive::simpleTrace(), 1);
 
 		if (!m_ms.internal.back().from)
 			m_ms.internal.pop_back();
@@ -421,6 +421,39 @@ void FakeExtVM::importCallCreates(mArray& _callcreates)
 	}
 }
 
+eth::OnOpFunc FakeExtVM::simpleTrace()
+{
+	return [](uint64_t steps, eth::Instruction inst, bigint newMemSize, bigint gasCost, void* voidVM, void const* voidExt)
+	{
+		FakeExtVM const& ext = *(FakeExtVM const*)voidExt;
+		eth::VM& vm = *(eth::VM*)voidVM;
+
+		std::ostringstream o;
+		o << std::endl << "    STACK" << std::endl;
+		for (auto i: vm.stack())
+			o << (h256)i << std::endl;
+		o << "    MEMORY" << std::endl << memDump(vm.memory());
+		o << "    STORAGE" << std::endl;
+
+		for (auto const& i: ext.state().storage(ext.myAddress))
+			o << std::showbase << std::hex << i.first << ": " << i.second << std::endl;
+
+		for (auto const& i: std::get<2>(ext.addresses.find(ext.myAddress)->second))
+			o << std::showbase << std::hex << i.first << ": " << i.second << std::endl;
+
+		dev::LogOutputStream<eth::VMTraceChannel, false>(true) << o.str();
+		dev::LogOutputStream<eth::VMTraceChannel, false>(false) << " | " << std::dec << ext.depth << " | " << ext.myAddress << " | #" << steps << " | " << std::hex << std::setw(4) << std::setfill('0') << vm.curPC() << " : " << instructionInfo(inst).name << " | " << std::dec << vm.gas() << " | -" << std::dec << gasCost << " | " << newMemSize << "x32" << " ]";
+
+		if (eth::VMTraceChannel::verbosity <= g_logVerbosity)
+		{
+			std::ofstream f;
+			f.open("./vmtrace.log", std::ofstream::app);
+			f << o.str();
+			f << " | " << std::dec << ext.depth << " | " << ext.myAddress << " | #" << steps << " | " << std::hex << std::setw(4) << std::setfill('0') << vm.curPC() << " : " << instructionInfo(inst).name << " | " << std::dec << vm.gas() << " | -" << std::dec << gasCost << " | " << newMemSize << "x32";
+		}
+	};
+}
+
 // THIS IS BROKEN AND NEEDS TO BE REMOVED.
 h160 FakeState::createNewAddress(Address _newAddress, Address _sender, u256 _endowment, u256 _gasPrice, u256* _gas, bytesConstRef _code, Address _origin, SubState* o_sub, Manifest* o_ms, OnOpFunc const& _onOp, unsigned _level)
 {
@@ -517,7 +550,7 @@ void doTests(json_spirit::mValue& v, bool _fillin)
 		VM vm(fev.gas);
 		try
 		{
-			output = vm.go(fev, fev.simpleTrace<FakeExtVM>()).toVector();
+			output = vm.go(fev, fev.simpleTrace()).toVector();
 		}
 		catch (Exception const& _e)
 		{
diff --git a/test/vm.h b/test/vm.h
index f3aae694a..ddc6ddb3e 100644
--- a/test/vm.h
+++ b/test/vm.h
@@ -81,9 +81,7 @@ public:
 	json_spirit::mArray exportCallCreates();
 	void importCallCreates(json_spirit::mArray& _callcreates);
 
-	template<typename ExtVMType>
 	eth::OnOpFunc simpleTrace();
-
 	FakeState state() const { return m_s; }
 
 	std::map<Address, std::tuple<u256, u256, std::map<u256, u256>, bytes>> addresses;
@@ -97,32 +95,5 @@ private:
 	eth::Manifest m_ms;
 };
 
-template<typename ExtVMType>
-eth::OnOpFunc FakeExtVM::simpleTrace()
-{
-	return [](uint64_t steps, eth::Instruction inst, bigint newMemSize, bigint gasCost, void* voidVM, void const* voidExt)
-	{
-		ExtVMType const& ext = *(ExtVMType const*)voidExt;
-		eth::VM& vm = *(eth::VM*)voidVM;
-
-		std::ostringstream o;
-		o << std::endl << "    STACK" << std::endl;
-		for (auto i: vm.stack())
-			o << (h256)i << std::endl;
-		o << "    MEMORY" << std::endl << memDump(vm.memory());
-		o << "    STORAGE" << std::endl;
-		for (auto const& i: ext.state().storage(ext.myAddress))
-			o << std::showbase << std::hex << i.first << ": " << i.second << std::endl;
-		dev::LogOutputStream<eth::VMTraceChannel, false>(true) << o.str();
-		dev::LogOutputStream<eth::VMTraceChannel, false>(false) << " | " << std::dec << ext.depth << " | " << ext.myAddress << " | #" << steps << " | " << std::hex << std::setw(4) << std::setfill('0') << vm.curPC() << " : " << instructionInfo(inst).name << " | " << std::dec << vm.gas() << " | -" << std::dec << gasCost << " | " << newMemSize << "x32" << " ]";
 
-		if (eth::VMTraceChannel::verbosity <= g_logVerbosity)
-		{
-			std::ofstream f;
-			f.open("./vmtrace.log", std::ofstream::app);
-			f << o.str();
-			f << " | " << std::dec << ext.depth << " | " << ext.myAddress << " | #" << steps << " | " << std::hex << std::setw(4) << std::setfill('0') << vm.curPC() << " : " << instructionInfo(inst).name << " | " << std::dec << vm.gas() << " | -" << std::dec << gasCost << " | " << newMemSize << "x32";
-		}
-	};
-}
 } } // Namespace Close