What Bitcoin Did OP_RETURN, Filters & Bitcoin’s Identity Crisis w/ Shinobi
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May 6, 2025 Shinobi, the Technical Editor at Bitcoin Magazine, dives into the heated 'OP_RETURN war' impacting Bitcoin's future. He examines the origins and current debates around the OP_RETURN limit and how users are finding ways to bypass it. The discussion reveals concerns about how transaction filters might jeopardize network security and centralization. Additionally, Shinobi explores the philosophical dilemmas of scaling Bitcoin versus preserving its core values, shedding light on its identity crisis amidst external pressures and internal debates.
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OP_RETURN Limit Impacts Layer 2
- Removing the OP_RETURN limit would allow more efficient data handling for Layer 2 protocols like BitVM without bloat from unspendable outputs.
- Current filters disrupt network visibility causing issues with fee estimation and Layer 2 functions, but don't stop transactions from being mined.
Data Embedding Methods in Bitcoin
- OP_RETURN stores arbitrary data off-chain preventing UTXO bloat, while unspendable outputs increase the UTXO set size, harming node resource needs.
- Witness data allows more data embedding without permanent UTXO bloat, useful for more complex data like inscriptions.
Filters Protect Upgrades, Not Block Spam
- Network filters are ineffective at stopping transactions if miners are willing to accept fees for them.
- Filters mainly protect upgrade paths and prevent denial-of-service attacks by limiting complex, costly transactions.