The architecture of trust, stripped to its bones. That’s what BIP 110 is doing to Bitcoin — but not in the way its authors intended.
Michael Saylor doesn't usually wade into BIP-level technical debates. He buys Bitcoin, holds it, and lectures the world on macro liquidity. But last week, he broke protocol. His target: BIP 110, a proposal to cap transaction data at 10,000 weight units per input, and restrict future witness versions. His verdict: it’s a “crude proxy” that trades neutrality for a speculative security gain. When the largest institutional holder of Bitcoin issues a statement, the market should listen. Not for the price impact — but for the governance signal.
I’ve audited smart contracts since 2017. I’ve seen ICOs ship reentrancy bugs that drained millions. I’ve watched DeFi protocols fold because their liquidity models ignored impermanent loss under volatility. What I’ve learned is this: code-level decisions are never just code. They are economic statements. BIP 110 is no exception.
The Context: What BIP 110 Actually Does
BIP 110, authored by an anonymous or pseudonymous entity, proposes a soft fork that limits the total weight of input script data per transaction. Currently, a Bitcoin transaction can carry arbitrary script data, limited only by block weight. The proposal argues this creates a DoS attack vector: an adversary could flood the network with large-input transactions, inflating node storage and bandwidth costs.
The fix? Cap the script size per input, and simultaneously tighten restrictions on Taproot control blocks and undefined witness versions. On the surface, it’s a defensive move. But the packaging is critical. The proposal bundles multiple restrictions into one BIP, including a ban on future witness versions unless explicitly activated by miner signaling. That last part is the landmine.
The Core: Why It’s a Governance Nightmare, Not a Technical Fix
Let me be direct: I’ve stress-tested Uniswap V2’s AMM during the 2020 crash. I know what “crude proxy” looks like. BIP 110 is one. The proposal lacks a quantified baseline. It targets a cost that, as Saylor noted, has never been measured. Without data on actual node storage growth from large-input transactions, the solution is a solution in search of a problem.
But the deeper issue is the bundling. BIP 110 ties a legitimate (if unproven) security concern to a preemptive ban on future upgrades. Taproot is only a few years old. BitVM, a method for off-chain computation verification on Bitcoin, relies on flexible script space and witness version expansion. By capping inputs and freezing new witness versions, BIP 110 effectively shuts the door on BitVM before it even enters production.
This is where my 2022 experience with zk-SNARKs comes in. I spent six months optimizing proof generation circuits. I learned that protocol flexibility is not a nice-to-have — it’s a macro-economic stabilizer. Restricting it early kills the very innovations that make a network resilient under bear market pressure. BIP 110 would create “technical debt” by closing off future upgrades. That’s not prudent engineering; it’s rigidity disguised as security.
The Data That’s Missing
The proposal relies on the assumption that large-input scripts are a credible DoS vector. Let’s verify this empirically. According to on-chain data from Glassnode and Coin Metrics, the average input script size has remained below 200 bytes for the past three years. Transactions exceeding 10,000 weight units (the proposed cap) represent less than 0.5% of all transactions. Even if an attacker spammed the network with such transactions, the cost in fees to fill a block would be prohibitive — around 0.1 BTC per block at current rates. That’s not a feasible DoS vector. It’s a theoretical edge case.
Saylor’s “crude proxy” critique holds water. The solution doesn’t match the magnitude of the problem. Worse, it introduces a broader restriction that will affect legitimate uses. Taproot-enabled multi-sigs, time-locked scripts, and future smart contract-like constructions all depend on flexible witness data. BIP 110 is a hammer where a scalpel is needed.
The Activation Threshold: 55% and the Risk of Capture
This is the part that keeps me up at night. BIP 110 proposes a miner activation threshold of 55% of the hashrate, compared to the traditional 95% used in past soft forks. The justification: lower threshold makes activation easier. But easier for whom?
In 2020, I stress-tested centralized exchange liquidity during the March crash. I saw how a small group of large players could move markets. Apply that same logic to Bitcoin’s miner signalling. A 55% threshold means three or four major mining pools could activate a proposal without broad community consensus. That’s not decentralized governance. That’s oligarchic capture.
Adam Back, CEO of Blockstream and a Bitcoin core developer, predicted BIP 110 would “stall in weeks.” Trust his instinct. The threshold, combined with the bundled restrictions, indicates a proposal designed to pass under the radar. It’s a governance test: can a small coalition force a change that the broader community hasn’t validated?
The Contrarian Angle: The Real Danger Isn’t the Fork, It’s the Precedent
Conventional market wisdom will tell you BIP 110 is a storm in a teacup — a technical debate that won’t affect the price. That’s shortsighted. The real risk is not the soft fork itself; it’s the governance precedent it sets. If BIP 110 passes, it will establish a new norm: that Bitcoin’s rules can be changed with 55% miner support, even in the face of vocal opposition from institutional holders and developers.
This precedent undermines Bitcoin’s “digital gold” narrative. Gold doesn’t change its purity standards every six months. Institutions like MicroStrategy, BlackRock, and Fidelity rely on Bitcoin’s predictable monetary policy. A governance model that allows rapid, controversial changes introduces uncertainty. Uncertainty is the enemy of capital allocation.
Furthermore, the bundling tactic will be repeated. Future BIPs will combine a palatable fix with a controversial restriction, betting that the community swallows the whole pill. That’s not technical progress; it’s regulatory arbitrage. Saylor’s call for a “neutral guardian” is a plea for Bitcoin to remain a neutral settlement layer, not a playground for special interests.
The Takeaway: Watching the Signals
Bitcoin’s ability to self-correct is being stress-tested in real time. The architecture of trust is not a static codebase; it’s a living process of consensus and conflict. BIP 110 will likely fail, thanks to powerful opposition and weak technical justification. But its legacy will be the questions it forced us to ask: Who sets the rules? What threshold is legitimate? And how do we protect against governance capture?
Where code becomes law in the digital frontier, we must audit not just the code, but the process by which it is written. BIP 110 is a stress test. Bitcoin’s governance must pass it — or prove it can fail gracefully.
I’ll be watching three signals over the next quarter: miner signalling rates on the BIP 110 activation chain, any change in stance from Adam Back or other core developers, and the reaction of BitVM proponents. If the proposal stalls, as I expect, it will be a reaffirmation of Bitcoin’s conservatism. If it advances, we’ll have a much bigger conversation on our hands.
Navigating the storm with empirical precision is the only way forward. Check the data. Verify the incentives. Trust the process.
Clarity emerges from the chaos of verification.
