BIP-110 Chain Split Stalls as Miners Reject Contentious Soft Fork

The Bitcoin network has entered a period of unprecedented governance friction as the activation of Bitcoin Improvement Proposal 110 (BIP-110) triggered a contentious chain split at block 961,632 ^{news.bitcoin.com}. This divergence, characterized by a clash between a determined minority of node operators and the overwhelming majority of the industrial mining complex, represents a live stress test of Bitcoin's consensus mechanisms ^{ambcrypto.com}. While proponents of the "Reduced Data Temporary Softfork" argue that restricting non-financial data is essential to preserving the network's monetary integrity, the immediate result has been the creation of a stalled minority branch that inherited a crushing mining difficulty it lacks the hashrate to overcome ^{news.bitcoin.com}. As the gap between the dominant chain and the BIP-110 branch widens, the debate has shifted from technical parameters to the fundamental power dynamics between those who validate the rules and those who secure the ledger ^{cryptopotato.com}.

Data Snapshot

As of August 10, 2026, SentiSignal proprietary data indicates that BTC Sentiment remains cautiously optimistic despite the network split, with an average sentiment score of 0.060 and a VADER score of 0.109 across 264 sources. The latest BTC Price is recorded at $65050.00, representing a 0.23% change from the oldest recorded price in this window of $64901.59.

The Genesis of the Split: Block 961,632

The fracture of the Bitcoin blockchain occurred precisely at block height 961,632 on Saturday, August 8, 2026 ^{news.bitcoin.com}. This specific block marked the commencement of the mandatory-signaling window for BIP-110, a phase where nodes running modified software began enforcing new validity rules ^{ambcrypto.com}. Under these rules, any block that did not signal support for the proposal via version bit 4 was to be rejected by enforcing nodes ^{cointelegraph.com}.

The split was catalyzed when AntPool, a major mining entity, produced a non-signaling block at height 961,632 ^{news.bitcoin.com}. While the standard Bitcoin network accepted this block, nodes enforcing BIP-110 rejected it, instead following a rival block produced by the mining group Roughnecks ^{news.bitcoin.com}. Roughnecks, utilizing the OCEAN pool's DATUM system, successfully mined the first two blocks of the minority chain—961,632 and 961,633—before the branch effectively ground to a halt ^{news.bitcoin.com}.

The divergence was further complicated by a simultaneous difficulty adjustment ^{news.bitcoin.com}. At the exact moment of the split, Bitcoin's mining difficulty climbed by 0.99% to reach 127.48 trillion ^{news.bitcoin.com}. This high difficulty, inherited by both chains, proved to be a "mechanical trap" for the minority branch, which possessed only a sliver of the total network hashrate ^{thecurrencyanalytics.com}.

Technical Objectives of BIP-110

BIP-110, authored by the pseudonymous developer Dathon Ohm with significant input from Luke Dashjr, is formally titled the "Reduced Data Temporary Softfork" ^{news.bitcoin.com}. The proposal aims to temporarily restrict the use of Bitcoin's block space for non-financial data, such as text, images, and inscriptions, which have gained popularity through protocols like Ordinals and Runes ^{ambcrypto.com cryptopotato.com}.

The proposal introduces several specific consensus restrictions intended to last for approximately one year ^{thecurrencyanalytics.com}:

• A 34-byte ceiling on most new output scripts ^{blockonomi.com}.
• An 83-byte maximum for OP_RETURN outputs ^{cointelegraph.com}.
• A 256-byte restriction on specific data pushes and witness elements ^crypto.news.
• Temporary limitations on several Taproot features ^{blockonomi.com}.

Proponents argue these measures are necessary to reduce the storage and bandwidth demands on node operators, which they contend are being elevated by "spam" data ^{thecurrencyanalytics.com}. Conversely, critics maintain that any user who pays the required transaction fee should have unrestricted access to block space, and that policing transaction types erodes Bitcoin's censorship resistance ^{cryptopotato.com}.

The Hashrate Disconnect and Difficulty Trap

The primary reason for the minority chain's failure to gain momentum is the stark disparity in mining support. Prior to the split, only 51 out of 2,016 blocks (approximately 2.53%) signaled support for BIP-110 ^{ambcrypto.com}. This was significantly lower than the 55% threshold required for a clean activation without a contentious split ^{blockonomi.com}.

Because the minority chain inherited the 127.48 trillion difficulty target of the main network, the few miners supporting BIP-110 faced an insurmountable task ^{news.bitcoin.com}. Bitcoin's protocol only adjusts difficulty every 2,016 blocks ^{thecurrencyanalytics.com}. At the observed pace of production, analysts estimated the minority chain would require roughly 350 days to reach its next difficulty adjustment, compared to the standard 14-day cycle on the main chain ^{blockonomi.com}.

By August 9, the gap between the two chains had widened dramatically. While the BIP-110 branch remained frozen at block 961,633, the dominant Bitcoin chain had reached block 961,744, creating a 111-block lead ^crypto.news. Michael Saylor, Executive Chairman of MicroStrategy, estimated that approximately 99.85% of Bitcoin's hashpower remained on the main chain, leaving the fork with just 0.15% of the total computing power ^{cryptopotato.com blockonomi.com}.

The "Nuclear Option": Proof-of-Work Reset

Faced with the reality of a stalled chain, BIP-110 proponents have begun discussing a more radical contingency: changing the proof-of-work (PoW) algorithm ^{news.bitcoin.com}. This move, often described as "firing the miners," would allow the minority chain to escape its dependence on the SHA-256d mining industry that overwhelmingly rejected the proposal ^{news.bitcoin.com}.

Inside the Bitcoin Knots Discord server, Luke Dashjr and other supporters have debated various alternative algorithms, including RandomX, Scrypt, and BLAKE3 ^{news.bitcoin.com}. Dashjr suggested a deterministic random selection process to prevent any single group from gaining a head start in developing specialized hardware for the new algorithm ^{news.bitcoin.com}.

However, changing the PoW algorithm is a double-edged sword. While it would allow the chain to resume block production, it would also necessitate the development of an entirely new mining infrastructure ^{thecurrencyanalytics.com}. Furthermore, it would represent a definitive break from the existing Bitcoin network, effectively turning the minority branch into a new altcoin rather than a soft-fork upgrade ^{news.bitcoin.com}.

Market Resilience and Replay Risks

Despite the technical turmoil, Bitcoin's market price has remained remarkably stable, trading around the $65,000 level ^{cryptopotato.com}. This stability suggests that the broader market views the BIP-110 split as a failed attempt at a minority-led governance change rather than a systemic threat to the network ^{coinfomania.com}.

However, the split introduces practical risks for users, most notably "replay risk" ^{blockonomi.com}. Because both chains recognize the same transaction format and ownership signatures, a transaction signed on the minority chain could potentially be rebroadcast and validated on the main chain ^crypto.news. Developers have warned holders against moving coins on the minority branch without first ensuring they are properly separated to avoid unintended losses of "real" BTC ^crypto.news.

Prominent figures in the space have expressed strong opposition to the BIP-110 approach. Adam Back, CEO of Blockstream, warned that consensus-level changes without broad agreement could damage Bitcoin's credibility and potentially make certain unspent transaction outputs (UTXOs) unspendable ^{thecurrencyanalytics.com}. Michael Saylor echoed these concerns, stating that while he may share the proposal's objectives, the method used threatens Bitcoin's foundational neutrality ^{cointelegraph.com}.

The Future of BIP-110 and Bitcoin Governance

The mandatory-signaling window for BIP-110 is scheduled to continue through block 963,647 ^{thecurrencyanalytics.com}. Under the proposal's timeline, the state would move to "LOCKED_IN" at block 963,648, with the actual transaction restrictions taking effect at block 965,664 ^crypto.news. However, given that the minority chain is currently over 100 blocks behind and lacks mining power, it is unclear if it will ever reach these milestones on a meaningful timeline ^{blockonomi.com}.

The Roughnecks mining group, which was the primary driver of the minority chain, announced on August 9 that it would stop mining under its name and urged others to stand down ^{news.bitcoin.com}. This retreat, coupled with a 96.5% collapse in Ocean's displayed hashrate, suggests that the economic reality of mining a minority fork has set in ^{news.bitcoin.com}.

Ultimately, the BIP-110 saga serves as a definitive demonstration of the "Nakamoto Consensus" in action. As noted by some observers, miners "vote with their CPU power," and in this instance, the vote was overwhelmingly against the proposed changes ^{news.bitcoin.com}. While node operators have the power to reject blocks, they cannot force the creation of a viable chain without the cooperation of the mining industry ^{news.bitcoin.com}.

What We Don't Know

It remains unclear whether the BIP-110 supporters will actually implement a proof-of-work algorithm change or if the minority chain will simply fade into obsolescence. Furthermore, the long-term impact on the Bitcoin Knots project and Luke Dashjr's role within the developer community is yet to be determined following calls for his removal as a BIP editor. Finally, the extent to which replay attacks have already occurred or will occur if the minority chain is revived remains a significant open question for users holding pre-fork balances.