TL;DR
BIP-110, the proposal to improve Bitcoin that sought to temporarily restrict certain types of data on the blockchain, has been effectively shelved after failing to secure significant backing from miners, companies, or developers relevant to the ecosystem. The debate it generated, however, clearly exposes how Bitcoin’s governance actually works and what interests are at stake whenever someone attempts to modify its consensus rules.
The dispute traces back to the activation of the Taproot protocol in 2021. Taproot enabled the possibility of embedding images, text, and other data directly into Bitcoin transactions. That gave rise to Inscriptions and, with them, Ordinals —the equivalent of non-fungible tokens (NFTs) within Bitcoin— and later to Runes, a protocol for creating memecoins. Veteran developers like Luke Dashjr argued that these applications exploited technical loopholes and that unnecessary blockchain growth makes running a full node more expensive, favoring large mining operations at the expense of decentralization.
BIP-110 did not aim to permanently ban non-financial data, but rather to temporarily tighten consensus rules for approximately one year, rendering inscription methods unviable while long-term solutions were evaluated.
Even so, its critics understood it as an attempt at selective censorship. The central argument was that Bitcoin’s consensus rules have historically treated all valid transactions equally, regardless of their purpose, and that opening an exception for one category could justify future restrictions on others.
The chosen activation mechanism was also controversial. Rather than seeking the broad support that historical protocol changes require, BIP-110 pushed for a user-activated approach, where updated nodes would enforce the new rules if predefined conditions were met. For many, this evoked the block size wars of 2017, an episode that fractured the community.
Michael Saylor, founder of Strategy —the largest corporate holder of bitcoin—, was direct in his rejection. “It turns a spam dispute into a consensus change that would invalidate currently valid transactions that pay fees.” “That precedent is the danger.” Adam Back, co-founder of Blockstream, also voiced sustained opposition.
With only 0.7% of miners in favor, BIP-110 reached a dead end. Bitcoin knows well that lasting changes require broad alignment among those who write the code, secure the network, and build on top of it.
