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Happy Tuesday! Debate erupted on Github and social media this week about expanding Bitcoin’s OP_RETURN data limit. We cover all the deets, receipts, and the arguments for (or against) in today’s newsletter. Plus, Chart of the Week, Tweets and more!

The full article (linked at the end of the newsletter excerpt) is about a 10 minutes read.

Tuesday Morning Opens

The Great OP_RETURN Debate

What is old is new again.

Bitcoiners have been having a debate about OP_RETURN – a Bitcoin script that stores data inside a transaction – and its data limit since the dawn of Bitcoin. The first major argument dates back to 2014 during the aptly named OP_RETURN Wars. At the time, users were using OP_RETURN for non-financial reasons – in particular the Counterparty Protocol, a Bitcoin NFT platform that predates Ordinals.

If we go back and read the forums and mailing list, we see many of the exact same cast of characters arguing about it today, such as Luke Dashjr, Pieter Wuille, Peter Todd, and Gregory Maxwell.

The current filter fight began as a fairly normal Bitcoin developer mailing list discussion two weeks ago.

Developer Peter Todd submitted a relevant pull request #32359 to the Bitcoin Core Github. (Bitcoin Core is the majority client, or software, used for Bitcoin nodes).

Comments on Todd’s request quickly turned accusatory and hostile, resulting in forum moderators timing out users and eventually locking comments on the thread. 

The follow up conversation that spilled into social media is too sprawling to adequately cover in a writeup. However, let’s try to break down the debate.

The OP_RETURN data limit expansion proposal

Todd’s pull request proposes to relax Bitcoin Core’s relay policy.

This is done by making the default size of an OP_RETURN transaction that a Core node relays the same as is allowed by Bitcoin Consensus (roughly 1MB). Remember, 83 bytes is currently the standard rule in Bitcoin Core.

Todd’s proposal would not require a soft fork nor hard fork – it simply expands the types of transactions that would propagate freely through the network of Bitcoin nodes.

For its part, Bitcoin Core is interested in the proposal to limit the growth of the UTXO set. For example, contributor Antoine Poinsot noted that Bitcoin startup Citrea is posting data to both the OP_RETURN data carrier and two unspendable outputs.

These two unspendable outputs would in theory grow the UTXO set over time–something Core wants to limit. So, increasing room for OP_RETURN data acts as an easy solution.

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Arguments against relaxing OP_RETURN data limits and filtering data

Most of the arguments against the pull request are from a relatively new camp in Bitcoin, the “filter” camp. Most notably affiliated with Ocean Pool, there’s a grab bag of opinions on why OP_RETURN shouldn’t be relaxed, ranging from technical to philosophical to downright conspiratorial. For instance, check out Ocean Pool’s lead Bitcoin Mechanic in his video entitled “Bitcoin Core Actively Sabotaging Bitcoin".

Technical arguments say that “spam” is undesirable and should be discouraged:

“We don't need to make sure no spam ever reaches the blockchain. That is, of course, impossible. All we need to do is show active hostility to the spammers, and the worst schemes (the ones that rely on a consistent transaction format) will be impossible to maintain, and will therefore lose funding,” argues Bitcoin Developer Chris Guida.

Philosophical arguments are difficult to pin down, but generally they say that Bitcoin is for financial data only and that Bitcoin should not be a “database” or for “data storage.”

On the extreme end is Ocean Pool CEO Luke Dashjr, who’s decided any increase in ‘spam’ on Bitcoin is the digital equivalent of “rape.” Yes, that is his literal position.

Others have chimed in that relaxing OP_RETURN is the “quickest way to kill the Bitcoin project.” While Bitcoin Mechanic was clear that this relaxed relay policy is “death to Bitcoin,” and that “we may have to go down fighting it.”

Argument for relaxing the OP_RETURN data limit

Okay, so that was a lot. On the other side of the debate, we have two primary arguments:

• Relaxing the standard discourages users from handing nonstandard transactions directly to miners, and therefore helping to decentralize mining.

• OP_RETURN is arbitrarily tight, a relic of a time when there were no technical reasons to expand the standard OP_RETURN data limit.

What do you think about the OP_RETURN? Reply with the your take!

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Chart of the Week

How’s the reporting on Bitcoin? Pretty negative, if you’re at The Guardian, per Bitcoin Perception - link

Tweet of the Week

I mean, really y’all, what’s all the fuss about?…

Blockspace Podcasts

On last week’s Bitcoin Season 2 Writer’s Room, Charlie and Colin dissect the different approaches states has proposed for strategic bitcoin reserves. How is your state doing in the race toward a strategic reserve?

-CBS & CMH