The Bitcoin community is locked in a heated dispute over BIP-110, a temporary soft-fork proposal that seeks to restrict arbitrary data in transactions and reduce the share of blockchain space used by inscriptions, Runes, and other non-monetary data.
Under the proposal, most new transaction outputs would be limited to 34 bytes, the 83-byte cap on OP_RETURN would be restored, and Taproot-related functions would face temporary restrictions. Backers say the goal is to protect Bitcoin’s core role as money by addressing what they see as incentive distortions created by standardized support for arbitrary data.
Activation plan sets up an early-August deadline
BIP-110 uses a miner-signaled activation path and sets an early-August deadline for a User Activated Soft Fork, or UASF. The proposal has drawn attention not only for the policy it introduces, but also for the process it would use to push those changes through.
Approval threshold cut from 95% to 55%
One of the proposal’s most controversial features is a rewrite of Bitcoin’s upgrade approval threshold. Under the current rule, a protocol upgrade typically requires 95% miner support to activate. BIP-110 would lower that bar to 55%.
That change has become a central fault line in the debate. Supporters argue a lower threshold, combined with tighter limits on data-heavy use cases, would ease the burden on node operators and curb what they describe as spam transactions.
Critics warn of neutrality, Layer2, and UTXO risks
Opponents have pushed back hard. Critics including developer Jameson Lopp and Michael Saylor say the proposal could damage Bitcoin’s neutrality, slow Layer2 development, interfere with script upgrades, and potentially freeze some existing UTXOs.
Dathon Pwn said he found a consensus flaw called “BlockSlop.” According to that criticism, nodes that enforce BIP-110 may not revalidate old blocks, creating a risk of divergence in blockchain history.
Michael Saylor said the governance risk in BIP-110 is greater than the problem the proposal is trying to solve.
Miner support remains low
Miner support for the proposal is currently very low, and the outcome remains unclear as community debate continues. The dispute has again exposed a deeper question in Bitcoin governance: who gets to decide the network’s future.
Some participants see BIP-110 as a necessary cleanup measure. Critics counter that forcing data restrictions could set a precedent for censorship and still fail to stop spam, while shifting the problem into areas that may be harder to manage, including UTXO expansion.
With the August deadline approaching, the community is watching closely to see whether BIP-110 gains traction or becomes another flashpoint in Bitcoin’s long-running debate over protocol change.