The fork died eight hours after it was born. Two blocks. That is the entire legacy of BIP-110—a proposal to strip Bitcoin's block space of non-financial data, to purge Ordinals inscriptions and BRC-20 tokens from the ledger. Two blocks, at heights 961,632 and 961,633, then silence. The main chain continued to churn out blocks at its usual rhythm, reaching 961,681 without missing a beat. The attempted fork produced fewer blocks than a single afternoon of Bitcoin's normal operation. Beneath the yield lies the rot.
This is not a story about a failed technical upgrade. It is a story about governance, about the unspoken power dynamics that keep Bitcoin from fracturing into a thousand warring factions. It is a story about the cold, hard reality of hash power—the ultimate arbiter in a system that pretends to be democratic but is, in fact, a plutocracy of compute. And it is a story about the Ordinals ecosystem, which survived its most existential threat yet, not because of community support, but because the math simply did not add up.
Context: The Battle for Block Space
Bitcoin Improvement Proposal 110 (BIP-110) was not a novel invention. It was a conservative reaction—a proposal to restrict the use of OP_RETURN and other outputs to prevent the embedding of non-financial data, such as the inscriptions that power Ordinals and BRC-20 tokens. The idea came from a faction often called the "Bitcoin maximalists" or "purists," who argue that Bitcoin's block space should be reserved exclusively for monetary transactions. To them, Ordinals are a form of rent extraction, an abuse of the network's limited resources that drives up fees and clogs the mempool.
Proponents of BIP-110 attempted to activate it via a User-Activated Soft Fork (UASF)—a mechanism where nodes enforce new rules at a predetermined time, regardless of miner support. This contrasts with the standard BIP-9 activation, which requires miners to signal their support (typically 95%) over a difficulty adjustment period. BIP-110's threshold was lower: 55% signaling within a 2,016-block epoch. But in the previous epoch, only 51 blocks out of 2,016 had signaled support—a mere 2.53%. The proposal had no chance of reaching its threshold. Yet its supporters decided to push ahead anyway, forcing a split at block height 961,632.
Hype is noise; structure is signal. The structure of Bitcoin's governance is not written in any whitepaper. It is written in the silicon of ASICs and the electricity bills of mining farms. BIP-110's failure was not a technical flaw; it was a political miscalculation. The code did not lie, but the proposal's authors misread the balance of power.
Core: Systematic Teardown of a Failed Fork
Let me walk through the mechanics, as I have done for dozens of similar attempts over my 21 years in this industry. The first thing to understand is what BIP-110 actually changed. It was not a consensus-altering protocol like a new hashing algorithm. It was a policy change: nodes running BIP-110 would reject any block containing transactions that included non-financial data in script outputs—specifically, the kind of data used in Ordinals inscriptions. The proposal was technically simple: a filter on the mempool and a validation rule in the block acceptance logic. But that simplicity masked a radical redefinition of Bitcoin's purpose.
When the fork triggered, nodes enforcing BIP-110 rejected blocks that did not signal support. This created two chains: the main chain, where miners continued to build blocks with no restriction on data, and the fork chain, where only blocks from miners running BIP-110 were valid. The fork chain's first block (961,632) was mined by a single entity—likely a small pool or an individual miner with a few hundred terahash. The second block (961,633) followed shortly after. Then nothing. The difficulty adjustment on the fork chain was not triggered; the hash rate was so low that the network simply stopped producing blocks. The chain was effectively dead.
Why did miners abandon the fork so quickly? The answer lies in the economics. Bitcoin miners are profit-maximizing entities. They invest millions in hardware and electricity. The fees from Ordinals transactions have become a significant revenue stream. In 2023 and 2024, Ordinals-related fees accounted for up to 10-15% of total miner revenue during peak activity. BIP-110 would have eliminated that revenue entirely. No rational miner would support a proposal that cuts their income by double digits, especially when the main chain is already the dominant source of block rewards. The elegance of the code masked the brutal arithmetic of the balance sheet. Beauty is the mask; geometry is the bone.
But there is a deeper layer. The fork's failure also reveals the fragility of UASF as a governance tool. UASF is often described as a "user revolt"—a way for node operators to impose their will on miners. In theory, if enough nodes enforce a new rule, miners must follow or lose their block rewards. But in practice, miners have a countermeasure: they can simply ignore the fork and continue mining on the original chain. A fork with no hash rate is not a fork; it is a dead chain. The only way UASF succeeds is if a significant portion of the mining community supports it, either because they agree with the rule change or because they fear being excluded from the dominant chain. BIP-110 had neither. The proposal's support was so low that miners could comfortably ignore it.
I have audited similar attempts in the past. In 2017, I watched a boutique fund in Vienna lose 90% of its capital because it ignored the difference between a whitepaper's promises and a protocol's actual incentives. The same lesson applies here. BIP-110 was not a technical failure; it was a failure of economic alignment. The proposal's authors believed that code could enforce a new social contract. But code is just a set of rules. The real contract is the one that aligns incentives across all participants. And in Bitcoin, the miner is the final arbiter.
Contrarian: What the Bulls Got Right
Let me step back and offer a contrarian view. The BIP-110 supporters were not wrong about everything. Their core thesis—that Bitcoin's block space is a scarce resource that should be used efficiently—has merit. Ordinals transactions do increase mempool congestion and raise fees for ordinary users. In periods of high activity, fees can spike to levels that make small transactions uneconomical. This is a real problem. The "purists" correctly identify that Bitcoin's value proposition as a settlement layer is undermined if users cannot afford to use it. They also point out that the Ordinals ecosystem is built on a fragile foundation: if the Bitcoin core developers ever decide to disable OP_RETURN or change the scripting language, the entire ecosystem collapses. BIP-110 was a preemptive defense.
Moreover, the proposal's failure does not mean the idea is dead. It means the method was wrong. A forced UASF without miner support is a suicide mission. But the next iteration of this idea could come in a different form: perhaps through a BIP that includes miner incentives, or through a gradual fee structure change that makes data-heavy transactions economically nonviable. The bulls of BIP-110 were right to worry about the long-term health of the network. They just miscalculated the short-term power dynamics.
Silence is the loudest indicator of risk. The silence of the BIP-110 chain after block 961,633 speaks volumes about the lack of consensus. But the silence of the main chain's developers—who largely ignored the proposal—also signals a risk. By ignoring the Ordinals debate, the core developers are ceding the narrative to market forces. Eventually, a more serious proposal may emerge, one that has miner support and community backing. When that happens, the Ordinals ecosystem will have to adapt. The failure of BIP-110 is not a victory; it is a temporary reprieve.
Takeaway: The Unwritten Constitution
Bitcoin's governance is not a democracy. It is not a dictatorship. It is a dynamic equilibrium of incentives, where the hash rate is the ultimate voting power. BIP-110's two-block fork is a case study in how that equilibrium works. The proposal failed because it challenged the economic interests of the most powerful participants. The system self-corrected without any central authority, without any hard fork, without any drama. The code did not lie, but the contract between the stakeholders was clear: you cannot change the rules without the consent of those who secure the network.
What does this mean for the future? First, the Ordinals ecosystem is safe for now. The protocol-level threat has been neutralized. But the ideological battle is not over. The same forces that drove BIP-110 will continue to push for cleaner block space. They will try other channels: maybe a BIP that changes the fee market, maybe a proposal that requires a different type of mining incentive. Second, the failure reinforces the power of miners. They are not passive participants; they are the gatekeepers of any protocol change. Any proposal that does not account for their economic interests is dead on arrival.
Finally, this event is a warning to anyone who believes that code alone can enforce a new order. Bitcoin is not a machine; it is a living system of humans, machines, and capital. The code is the skeleton, but the incentives are the muscle. Without the muscle, the skeleton cannot move. The next time someone proposes a forced UASF, remember the two blocks that died in eight hours. Hype is noise; structure is signal. And the structure of Bitcoin's governance is written in the immutable laws of economics.
