- Bitcoin’s governance crisis deepens as developers push to lift long-standing protocol limits without broad consensus.
- The latest OP_RETURN proposal reignites debates over Bitcoin’s original vision, contrasting BTC’s technocratic control with BSV’s fixed-rule, market-driven approach.
- Critics argue Bitcoin Core has drifted from sound money principles, replacing economic law with insider politics and bureaucratic decision-making.
For over a decade, I have warned that BTC has become “a soft money” both in structure and in spirit. Where it once aimed to challenge the world’s dominant monetary order, it now mirrors its failures.
Its governance model, its culture, and its philosophy have drifted into dangerous territory; into bureaucracy masquerading as consensus and into ideology substituting for economic law.
Now, in the spring of 2025, the veneer is cracking enough for less engaged bitcoiners to have to ask what is going on. A new proposal from Bitcoin Core developers seeks to eliminate the 80-byte cap on the OP_RETURN function.
The OP_Return Proposal
Originally, the OP_RETURN limit was imposed as a guardrail, or so we were told. It was there to prevent “spam,” to encourage monetary transactions, to keep node operation costs low.
But in reality, the 80-byte limit was pushed almost unilaterally by Luke Dashjr in 2015 to shut down successful early use cases like the on-chain Satoshi Dice casino and the CounterParty token protocol.
At the time, the change was deeply ideological. A mechanism to suppress the protocol’s disruptive potential for applications to use bitcoin as a smart contract platform with integrated currency.
Dashjr’s move kicked off the years-long and brutal “Bitcoin Civil War.”
Now, Peter Todd proposes to remove that limit entirely, citing the usual technocratic rationale: the rule is outdated, arbitrary and easily circumvented.
But what’s really outdated is the idea that this change is being made through consensus. It’s not. It’s being dictated by insiders with outsized authority in the project.
Adding to the confusion, in this case, Peter Todd is actually right in that his proposal restores a classic, key feature of the Bitcoin stack, but he’s doing it in such a way that the methodology makes it contentious.
BTC’s governance has become a high-functioning bureaucracy, where nearly all of the network runs a single client called “Bitcoin Core,” and the software’s direction is decided by a handful of gatekeepers on GitHub.
Speak up, and you’re asked to “vote with your feet.” Challenge the ruling class, and you’ll find yourself ignored, silenced, or removed.
The Original Vision vs. Today’s Reality
Bitcoin, as Satoshi Nakamoto envisioned it, was to be governed by economic incentives and protected by protocol rules not the whims of a random collective of GitHub maintainers.
In the fallout of the Bitcoin Civil War, this is one of the products of splitting BCH from BTC and BSV from BCH – all variations of bitcoin with different sets of governance methodologies.
Notably, the vision for bitcoin’s original governance model is preserved in BSV where the protocol rules are deeply generalized and locked, and arguments like how big an OP_Return should be is decided by individual node operators.
Those node operators compete, policies can vary, and users and application developers choose what services to trust. It is a free market of competitive governance at the network level, not a priestly bureaucracy in open-source robes.
The Bitcoin Civil War Never Ended
BTC is governed by technocratic fiat; by social consensus shaped by opaque forces and insider politics.
BSV, by contrast, is governed by economic law: if a rule makes commercial sense, it survives; if it doesn’t, it dies, or the company that implements it dies on the hill of said rule.
It’s harsh,but it’s honest and never impacts the network as a whole.
And that honesty matters. Once policy becomes protocol and protocol becomes ideology, Bitcoin stops being money. It becomes a meme.
This is what I mean when I say BTC has failed. Not because it doesn’t work. Not because it isn’t secure. But because it no longer believes in itself as a disruptive force.
Now we reap the harvest of that division. The current OP_RETURN proposal was not born of need. It was a convenience for a specific set of privileged developers who have decided, arbitrarily, that the old limit no longer suits them.
In BTC, there is no mechanism to restrain bad ideas beyond social backlash, and even that is now filtered through gatekeeping and censorship because most of the influencers are sponsored by the same entities that have been paid to be developers for the last ten years.
BSV Offers an Alternative: Protocol Is Law
BSV chose a different path—one where protocol is law and law is fixed, where businesses can build without fearing that a comment thread on GitHub will pull the rug from under them, and where competition, not ideology, decides what thrives.
Because real money—sound money—must be hard, not just in supply but in structure. It must be hard to change, hard to co-opt, hard to politicize. BTC has proven, yet again, that it is not hard. It is malleable, centralized, and manipulated.
But Bitcoin, the real Bitcoin, remains. At least, it remains as an idea because “bitcoin” isn’t just a ticker, a network or unit of measure. Bitcoin, at its true core, is an unbreakable set of rules that, if implemented precisely, give the world an absolute powerhouse of transaction capability.
