Anyone who has followed the winding and arcane world of bitcoin since Satoshi Nakamoto’s founding paper in 2008 would have been aware that the fuel powering the project was as much political and philosophical as technical. Bitcoin was supposed to free us from centuries of financial hegemony, and create a free and democratic form of money where all could participate, free of politics, special interests, misaligned incentives, overseers and hierarchies.
Yeah, right. Like all other imagined utopias, humans with their foibles and competing ideologies have intruded, often with anger and insult.
The bitcoin community is no exception.
The first holy war was between 2015 and 2017, now referred to as the blocksize wars. The short form of this story is that some in the bitcoin community wanted to increase the size of a “block” on the blockchain beyond Satoshi’s recommendation to enable greater transaction throughput, among other things.
The originalists said no effing way, and a hot battle ensued, eventually resulting in a “fork” where two flavours of bitcoin were offered to a somewhat bewildered public (the big block version was called Bitcoin Cash). The original bitcoin prevailed (including with the all-important cohort of bitcoin miners). Bitcoin Cash is still out there in name (and on life support) and the original bitcoin became a trillion-dollar project.
The details of that war are less important than the fact that the war was really ugly. People on different sides of the debate got a little unhinged. Friendships were ruined, loathing and rage flared and things were said that could not be retracted. In the real world, nobody cared very much.
The imagined utopia of a peaceful, code-driven monetary system turned out to be a myth, because of humans being human. It left a permanent scar in the community’s collective memory.
This year, another holy war broke out.
Fabulous in theory, but ...
In December 2022, Casey Rodarmor noticed there was space in the protocol to carry data that had nothing to do with the storage and transfer of value. He and others realised that anyone could use this space for nonfungible tokens, JPEGs, other tokens, messages or whatever. And people did in fact start doing that (including Rodarmor in January 2023); there was no technical barrier. Sharpened knives were quickly drawn, and the faithful and the apostates surged onto the battlefield.
In December 2025 there was an offensive response from the faithful. A proposition called bitcoin improvement proposal (BIP-110) was floated by a pseudonymous developer named Dathon Ohm. It basically said that bitcoin should be prevented from being used for anything other than its original intent, and presented a software solution to enforce that.
Who proposes these things? Anyone can. And anyone who actually works on the blockchain (primarily miners and node operators) can activate the proposed technical solution when it is released. A flat democratic structure, fabulous in theory.
But BIP-110 opened another holy war because it touches precisely the same fault line as the original blocksize wars: who decides what bitcoin is? One faction views bitcoin as a monetary protocol whose design should actively discourage anything that distracts from that mission. To them, bytes devoted to cartoon apes or token metadata are storage that every node operator must preserve and carry forever, and are unrelated to the original monetary objective as described in Satoshi’s paper. They argue that the network exists to secure money, not digital collectibles.
The opposing camp sees matters very differently. Bitcoin, they argue, has never cared what people write into valid transactions provided they obey the consensus rules and pay the appropriate fee. Once software begins distinguishing between “good” and “bad” uses, someone must inevitably decide where the boundary lies. That transforms a neutral protocol into a curated one. Today’s target may be JPEGs; tomorrow it could be privacy tools, smart contracts or financial innovations today’s developers simply dislike. To them, BIP-110 is about censorship. And in the church of crypto, censorship is blasphemous.
In any event, both sides therefore claim to be defending bitcoin’s founding principles. The restrictionists insist they are preserving bitcoin’s identity as incorruptible money. Their opponents insist they are preserving bitcoin’s neutrality. Neither believes itself to be attacking decentralisation, but each accuses the other of doing precisely that.
This explains why the debate has become so extraordinarily bitter. Engineers normally disagree over trade-offs. Religious sects disagree over doctrine, and bitcoin increasingly resembles the latter.
When people fail to compromise
As in all holy wars, personalities have become inseparable from principles. Prominent developers, miners, entrepreneurs and investors have aligned themselves with opposing camps. Social media has magnified every disagreement into accusations of bad faith, hidden agendas and institutional capture. Questions that might once have been settled through technical discussion are now interpreted as tests of ideological purity. Even procedural questions — how proposals should be reviewed, who edits the BIP repository, and what constitutes legitimate consensus — have themselves become battlegrounds.
What makes bitcoin especially fascinating is that there is no recognised authority capable of ending the dispute. There is no standards committee whose decision is final, no CEO who can impose a roadmap, no government regulator who can simply decree an outcome and no pope to issue an encyclical. Consensus emerges only when enough miners, node operators, exchanges, developers and users independently choose the same software. In theory this is bitcoin’s greatest strength. In practice it makes every controversial upgrade resemble a constitutional crisis.
The most interesting aspect of BIP-110 is not whether it succeeds (as of the time of writing, it has not — the August 8 activation attracted only a very small percentage of node operators and even fewer miners). Yet failure does not make the episode unimportant; quite the opposite. Failed constitutional amendments often reveal more about a society than successful ones. They expose the values people refuse to compromise on.
The episode also demonstrates an uncomfortable truth about decentralised governance. Outsiders often imagine bitcoin (and other decentralised crypto projects) as a purely algorithmic system where mathematics replaces politics. Reality is considerably messier. Mathematics determines how blocks are validated. It cannot determine what rules people ought to adopt next. Those choices are inevitably social, involving persuasion, coalition-building and occasionally outright tribalism.
Perhaps that is the ultimate lesson of BIP-110. The transparent and flat governance of bitcoin demands that politics be conducted not by elected politicians (and their tools of influence and power), but by every voice in the community that cares to participate directly. That is a slower, messier and often more exasperating process.
It may also be the price that must be paid for creating a monetary system that belongs to nobody — precisely because it belongs to everybody.
Steven Boykey Sidley is a professor of practice at JBS, University of Johannesburg, a partner at Bridge Capital and a columnist-at-large at Daily Maverick, Daily Friend and Currency News. His new book “It’s Mine: How the Crypto Industry is Redefining Ownership” is published by Maverick451 in South Africa and Legend Times Group in UK/EU, and is available now.
