Decent Newsroom
Sign In

Why did bip110 fail

By stork August 9, 2026

BIP-110 failed because it attempted to enforce a semantic rule (what data is “valid” based on its content) rather than a technical one, and crucially, it lacked the economic majority support required to force miners to comply.

Unlike the successful SegWit activation (BIP148), where the economic majority (exchanges, wallets, users) united behind a change, BIP-110 faced near-universal opposition from the ecosystem’s key stakeholders. Here is the breakdown of why it collapsed:

1. Lack of Economic Majority Support

The core premise of a User-Activated Soft Fork (UASF) like BIP-110 is that if enough nodes run the new software, miners must follow or their blocks will be rejected by the economy.

  • The Reality: Major exchanges (Coinbase, Binance, etc.), wallet providers, and institutional players did not adopt BIP-110. They continued to accept transactions with Ordinals and Runes.

  • The Consequence: Miners had zero financial incentive to switch. If they mined blocks rejecting these transactions, the rest of the network would still accept them as valid on the main chain. The “minority chain” created by BIP-110 nodes would have no market value, rendering the effort useless.

2. Philosophical & Technical Objections

BIP-110 proposed to ban non-financial data (like images in Ordinals or tokens in Runes) by making them invalid at the consensus level. This was widely criticized for several reasons:

  • Content Neutrality: Bitcoin’s consensus rules are designed to check technical validity (e.g., “does this signature match?”), not intent or content. Critics argued that introducing a rule that says “this byte pattern is invalid because it looks like an image” violates the protocol’s neutrality.

  • “Bitcoin is Digital Cash” Fallacy: Proponents argued Bitcoin should only be used for money. However, many in the community argued that Bitcoin is a settlement layer and that users should be free to use block space however they wish, provided they pay the fees.

  • Ineffectiveness: Critics noted that even if BIP-110 passed, determined users could simply encode data differently to bypass the specific byte limits, making the rule a temporary nuisance rather than a permanent solution.

3. Flawed Activation Mechanism

  • No Replay Protection: Unlike the 2017 Bitcoin Cash fork, BIP-110 did not include replay protection. This meant that if a split occurred, a transaction made on the minority chain could potentially be replayed on the main chain (or vice versa), creating significant security risks for users.

  • Low Threshold: While BIP-110 lowered the signaling threshold to 55% (instead of the traditional 95%) to make activation easier, this actually highlighted the lack of miner support. Miner signaling remained below 3% throughout the activation period.

4. The Outcome: A “Minority Chain” That Died

When the activation date arrived, BIP-110 supporters ran nodes that enforced the new rules. However:

  • Miners continued mining the old rules (the main chain).

  • The BIP-110 nodes rejected the main chain’s blocks as invalid.

  • The BIP-110 nodes started building their own chain (the “minority chain”).

  • Because no major exchange or wallet supported this new chain, it had no liquidity.

  • Within days, the main chain outpaced the minority chain by dozens of blocks. The minority chain became an orphaned, worthless fork.

Summary

BIP-110 failed because nodes cannot force a soft fork without the backing of the economic majority. In the case of SegWit, the economic majority wanted the upgrade. In the case of BIP-110, the economic majority (exchanges, merchants, large holders) explicitly opposed it. Without that support, miners ignored the proposal, and the attempt resulted in a short-lived, valueless minority chain that quickly died.

#bitcoin
Write a comment