#What is Foundry USA's Latest Move Regarding Bitcoin Transactions?
Foundry USA, controlling about one-third of the global Bitcoin hashrate, has initiated a weighted hashrate vote to gauge whether its customers support BIP-110. This proposal aims to limit the amount of non-monetary data embedded in Bitcoin transactions. Currently, miner signaling for BIP-110 is below 1% as of mid-July 2026.
#How Does the Voting Process Operate?
The voting mechanism at Foundry takes each miner's average hashrate over a ten-day period, from July 6 to July 15, 2026, to determine their voting weight. A non-response from miners defaults to a “No” vote. Foundry has clarified that it will only announce a “Yes” signal if supporters achieve a 51% threshold of total hashrate participation. The voting window continues until early August 2026, coinciding with Bitcoin approaching block 961,632.
On July 21, 2026, Foundry released a comprehensive guide discussing the advantages and disadvantages of BIP-110, offering supporting materials to assist miners in making an informed choice.
#What Exactly Does BIP-110 Propose?
Introduced in December 2025 by Dathon Ohm, BIP-110 seeks to address the growing trend of embedding extensive non-financial data in Bitcoin transactions. This discussion gained traction following the rise of inscription-based protocols like Ordinals and BRC-20 tokens, which consumed considerable block space during 2022 and 2023.
The proposal suggests a temporary soft fork that limits transaction sizes and restricts certain capabilities of Taproot, which enable data embedding. There is also a built-in expiration period of one year post-activation, equating to approximately 52,416 blocks, unless renewed.
#What Are the Arguments For and Against BIP-110?
Proponents contend that Bitcoin's design serves as a medium of exchange rather than a data storage platform, highlighting instances where inscription activity contributed to fee spikes that disadvantaged average users.
Conversely, critics present two primary concerns. First, miners have relied on fees generated from data-heavy transactions, particularly as block rewards diminish over time. Second, opponents express concerns over setting a censorship precedent; if the network permits the restriction of valid transactions at the consensus level, this could eventually extend to other transaction categories.
#How Could BIP-110 Impact Investors?
With Foundry holding 33% of the network’s hashrate, a decision to back BIP-110 would significantly amplify its influence. However, with current signaling below 1%, the proposal faces challenges.
The recent halving has already pressured mining profitability. Given that fees from inscription-related activities have provided a critical buffer for some miners, the activation of BIP-110 could erode these fee advantages, posing a risk for less robust mining operations.
The temporary structure of the proposal and its one-year expiration offers a safeguard against long-term risks. Investors should closely monitor the voting outcomes as the early August deadline approaches, as this could have substantial implications for both the mining industry and transaction fees in the Bitcoin ecosystem.