The Proposal
BIP-110, formally titled the Reduced Data Temporary Soft Fork, would impose a one-year restriction on non-financial data embedded in Bitcoin transactions. Seven rules would cap most new outputs at 34 bytes, OP_RETURN at 83 bytes, and data pushes at 256 bytes. The targets: Ordinals inscriptions, BRC-20 tokens, and similar methods that store arbitrary data on-chain and compete with financial transactions for block space.
The proposal's supporters argue this is about preserving Bitcoin's purpose as a monetary network. Block space is finite. When JPEGs and token minting absorb capacity, fees rise for people trying to send actual bitcoin. The frustration is legitimate.
What makes BIP-110 different from past proposals is its activation mechanism.
The 55% Problem
Previous Bitcoin upgrades required overwhelming consensus. SegWit used a 95% miner-signaling threshold. Taproot activated with over 90% support. These high bars exist for a reason — they ensure that rule changes represent genuine network-wide agreement, not factional politics.
BIP-110 uses a user-activated soft fork (UASF) mechanism with a 55% miner-signaling threshold. Nodes running BIP-110 software would begin rejecting any block that doesn't signal support once activation begins, projected near September. The mandatory signaling mechanism kicks in around block 961,632, expected in early August.
This is not a technical detail. It is the entire controversy.
Where It Stands
The numbers are blunt. As the signaling window runs through mid-July, miner support sits at less than 1%. On July 9, Farside Investors flagged 17 new signaling blocks — enough to trigger monitoring alerts but representing a rounding error against the roughly 2,016 blocks per difficulty period.
Node adoption tells a similar story. The overwhelming majority of reachable Bitcoin nodes are not running BIP-110 software. The proposal has vocal support on social media but almost none where it actually matters: in the infrastructure that validates transactions and produces blocks.
The Opposition
The most powerful voices in Bitcoin have aligned against it.
Michael Saylor, whose company holds over 500,000 BTC, put it directly: "There are 110 things more dangerous to Bitcoin than spam. BIP-110 turns a spam dispute into a consensus change that would invalidate some currently valid, fee-paying transactions. That precedent is the danger."
Adam Back, whose hashcash proof-of-work system is cited in the Bitcoin white paper itself, was equally blunt: "Bitcoin respectfully says no to what you want. Your recourse is to fork away, but bitcoin won't be joining it."
Both objections land on the same point: the spam concern is real, but the proposed remedy creates a worse problem.
The Precedent That Matters
This is the core issue for long-term holders.
If BIP-110 established a playbook where a 55% threshold and a small group of developers can change Bitcoin's consensus rules, that playbook doesn't disappear after the data-limit debate ends. Any future actor with a sympathetic cause — sanctions filtering, content moderation, transaction censorship, KYC requirements at the protocol level — has a template to point to.
Bitcoin's history provides the lesson. The block size wars of 2015-2017 demonstrated that Bitcoin's resistance to rule changes is not a bug — it is the feature that makes the network trustworthy as a store of value. Miners, nodes, developers, users, and businesses all had to agree before SegWit activated. That friction is expensive. It is also the reason bitcoin is worth $62,783 and not zero.
Lowering the activation threshold to 55% doesn't just make this one change easier. It makes every future change easier. And in a system designed to be resistant to capture, "easier to change" is not an upgrade.
What Happens Next
With miner support near zero, BIP-110 is almost certainly not going to activate through voluntary signaling. The mandatory signaling mechanism creates a theoretical fork scenario, but a rule enforced by a fraction of nodes and almost no miners doesn't change Bitcoin — it creates a minority chain that nobody uses.
The most likely outcome: BIP-110 nodes split off, mine a handful of blocks, and the fork dies from indifference. The proposal fails not because the concern about data spam is invalid, but because the mechanism chosen to address it was fundamentally incompatible with how Bitcoin actually changes.
The spam problem will remain. The right approach — fee-market dynamics, mempool policy, relay rules — is boring and slow. But that's how Bitcoin works.
Bitcoin Gate Take
BIP-110 is dead on arrival as a protocol change, but the precedent debate it triggered is worth paying attention to. Saylor and Back are right: Bitcoin's greatest feature is not its block size or data limits — it is the near-impossibility of changing it. A 55% UASF threshold would weaken that property. The proposal will fail, but the next one that tries the same playbook might not announce itself so loudly.
Bitcoin's protocol governance affects its long-term value proposition. Our Bitcoin course covers everything from monetary theory to self-custody in 135 interactive cards.