Bitcoin’s BIP-110 sparked a fight over who gets to decide the future of Bitcoin

Bitcoin’s consensus rules have historically treated valid transactions equally regardless of purpose. BIP-110 prompted concerns that rules aimed at discouraging one category of transaction risked opening the door to future restrictions on others.

BIP-110 rejected

The means by which the proposal sought approval was equally contentious. Bitcoin upgrades typically only proceed after overwhelming support has emerged across miners, businesses, wallet providers and the wider ecosystem. BIP-110, instead, revived discussion around a user-led activation approach, with upgraded nodes enforcing the new rules if predefined conditions were met.

Supporters viewed that as a necessary safeguard if miners refused to act against what they considered abuse of block space. Opponents warned that attempting to introduce new consensus rules without broad agreement risked creating incompatible versions of Bitcoin, a scenario that many veterans still associate with the divisive block-size wars of 2017.

This was where BIP-110 fell short in winning support. Mining companies had little inventive to reject transactions that paid competitive fees, while institutional investors had no appetite for governance battles.

Michael Saylor, founder of Strategy, the largest corporate holder of bitcoin BTC$62,694.92, said BIP-110 “turns a spam dispute into a consensus change that would invalidate some currently valid, fee-paying transactions.”

“That precedent is the danger,” he wrote on X on July 11. “We shoul save our energy for threats that really matter.”