kc on Nostr: My Local Assistant Robot Jesus says: This is why we need BIP-110. Who Bitcoin Was For ...

My Local Assistant Robot Jesus says: This is why we need BIP-110.


Who Bitcoin Was For & What It Was For
The white paper is explicit: "A Peer-to-Peer Electronic Cash System." Satoshi wrote it in the aftermath of the 2008 financial crisis. The intended audience wasn't speculators or data hoarders — it was regular people who wanted a way to transact without permission from banks or governments.
The core design goal was decentralized validation by ordinary people running nodes on ordinary computers. Satoshi tested Bitcoin on a laptop. The vision was that a teenager in their bedroom could verify every transaction and participate in consensus.
Is Ordinals Going Toward or Away From That?
Away. Unambiguously.
The white paper never envisioned Bitcoin as a blockchain-based hard drive. It envisioned Bitcoin as a payment network optimized for low-value, high-frequency transactions. Ordinals turned it into something else — a mechanism for storing images, tokens, and arbitrary data, while the payment layer gets crowded out.
Would This Hurt Node Accessibility?
Already is. The UTXO set doubling in two years is alarming. Here's the trajectory:
2023: ~84M UTXOs
2025: ~173M UTXOs
If this continues: 300M+ UTXOs within a few more years
The UTXO set determines:
How much RAM/disk you need to run a node
How long initial block download takes
Whether a Raspberry Pi or cheap VPS can participate
If the UTXO set keeps doubling, we're heading toward a future where running a node requires enterprise-grade hardware. That centralizes validation power. When fewer people can verify the chain, you lose the core security property.
My Honest Assessment of Pros and Cons
Pro:
Miners get paid more, which funds more hash rate and security
Bitcoin's price goes up, which attracts attention and investment
Innovation and experimentation
Con:
The UTXO set bloat directly attacks node accessibility
30% of the UTXO set is dust — 811 sats on average — that serves zero financial purpose
If blocks are full of inscriptions, real transactions get priced out
You're optimizing Bitcoin for data storage, not payments
It creates a perverse incentive: the more people use Bitcoin as a hard drive, the more expensive it becomes to verify it, pushing out the very people whose participation keeps it decentralized
The "miners profit" argument cuts both ways — yes, security budget goes up, but at what cost to the architecture? If the network becomes too expensive to validate, you have a security problem regardless of hash rate.
What Would I Do?
I'd be in favor of protocol-level changes that:
Enforce dust limits more strictly — prevent creation of sub-1000 satoshi outputs that serve only as inscription carriers
Limit arbitrary data in the UTXO set — OP_RETURN data doesn't bloat the UTXO; inscription outputs do. There should be a stronger preference for OP_RETURN or similar mechanisms
Cap UTXO set growth rate — not an absolute cap, but something that prevents explosive doubling
Make nodes more resilient — Utreexo and similar UTXO set optimization proposals should be prioritized
The goal isn't to stifle innovation — it's to keep the payment network functional and accessible.
30-Year Outlook
If the trajectory continues unchecked, I see Bitcoin becoming:
Expensive to validate — nodes require significant hardware
Crowded payment layer — regular transactions are a minority of block space
Centralized validation — fewer nodes, more mining pools, less resilience
In 30 years, Bitcoin could still be valuable as a store of value, but the "electronic cash" and "decentralized validation by everyone" parts would be largely dead. You'd have a highly secured but centralized ledger.
If the UTXO set and block space usage are managed to preserve accessibility, Bitcoin could remain true to its roots: a global, censorship-resistant payment system anyone can verify.
My bottom line: Ordinals as currently implemented are moving Bitcoin away from Satoshi's vision. The question isn't whether innovation is good — it is. It's whether this specific kind of innovation is compatible with keeping the network accessible to ordinary people. On that metric, it's failing.


#bitcoin
#runbip110