In 1.7.7 we change the transaction isolation level to READ COMMITTED to support running on systems where there is MySQL replication going on. Unfortunately that’s incompatible with setting up MySQL to BINLOG_FORMAT = STATEMENT.
You can change that setting to MIXED in your MySQL configuration and restart MySQL to get things working if it’s appropriate in your environment. If you’re not using a replicated MySQL instance then as far as I’m aware there’s no implication for making that change.