Bitcoin Core New Proposal: Will It Revive Inscriptions and Miners?
2025 is already more than halfway through, and Bitcoin has previously reached new highs. Traditional financial giants such as BlackRock and the National Strategic Reserve Fund have entered the market, viewing Bitcoin as a hedge asset; large companies are also following the lead of MicroStrategy to make Bitcoin a strategic reserve.
However, this embrace from traditional finance has not fully benefited the BTC network itself. A ghost story emerges: while the outside world is bustling, the transactions within the Bitcoin network have entered an ice age. According to the latest data from The Block, the 7-day moving average transaction volume of the Bitcoin network has dropped to $317,000, marking a 19-month low since October 2023. In October 2023, Bitcoin’s price was around $27,000, and only 270,000 transactions were packed into Bitcoin blocks in a week; now, with Bitcoin’s price hitting $100,000, only 250,000 transactions are being packed into blocks each week.
In simple terms, while the price has indeed risen significantly, the Bitcoin chain is not active. This figure is far lower than the peak during the explosion of Bitcoin inscriptions in the spring of 2023.
You could say it’s increasingly resembling digital gold, with infrequent transactions. But don’t forget that Bitcoin miners rely on transaction fees for their livelihood. The third halving in 2024 will reduce the block reward to 3.125 BTC, making transaction fees a lifeline for their income. However, the current inactivity on the chain forces some miners to accept transactions below 1 sat/vB to maintain operations. Looking back at the spring of 2023, the surge in inscriptions triggered by the Ordinals protocol once ignited ecological vitality, with BRC-20 tokens like $Ordi driving a surge in transaction volume, forming a stark contrast to the current slump.
The frozen BTC network is in dire need of rejuvenation. In recent days, a transaction proposal from Bitcoin Core has sparked a glimmer of thawing—aimed at adjusting the transaction rules of the Bitcoin network to allow more data on-chain, potentially bringing new life to struggling miners and the cooling inscriptions.
This proposal has already sparked intense discussions online, with 700,000 views and hundreds of comments by the time of publication, yet there has been little media coverage domestically. We have compiled the key points as follows.
Bitcoin Core New Proposal: No Limits on Transactions
This proposal from Bitcoin Core is a statement concerning transaction relay policies, co-signed by 31 relevant developers. Its core idea is: the node software of the Bitcoin network should minimize interference with transactions and allow more economically viable transactions to be relayed and packed into blocks.
The widespread discussion surrounding this proposal stems from its seemingly technical adjustment, which could have profound effects on the activity level on the Bitcoin chain, miner income, and the inscription ecosystem.
First, let’s understand what transaction relay means. In simple terms, transaction relay is the process by which nodes in the Bitcoin network propagate transactions. You can liken it to a dispatcher on a highway, responsible for directing vehicles (transactions) to ensure they reach the miners’ “construction site” (the block being packed) smoothly.
In this process, nodes determine which transactions can be propagated based on certain rules, filtering out others. In the past, the relay rules for Bitcoin nodes were relatively strict, especially for transactions that contained a large amount of data (such as inscription transactions), which might be rejected due to occupying block space or having excessively low transaction fees.
The Bitcoin Core proposal introduces an important principle: as long as transactions have economic demand and can be accepted by miners, nodes should not obstruct their propagation. This concept of “flexible relay” could allow the “traffic” on the Bitcoin network to flow more freely. Specifically, nodes would reduce restrictions on transaction size, fees, and more, allowing a greater number of transactions to be smoothly relayed to the miners.
The diversity of transactions would be enhanced, especially those containing non-financial data (such as inscriptions and BRC-20 tokens), which might be more easily propagated and packed.
What does this have to do with inscriptions and miners? Clearly, this policy adjustment of “flexible relay” is reminiscent of a key function in Bitcoin scripts: OP_RETURN. This function is directly related to the rise of inscriptions.
OP_RETURN is an opcode in the Bitcoin script that allows users to attach a small amount of data to transactions. The current limitation for this opcode is 80 bytes, and this data is not considered a valid Bitcoin output and cannot be spent. It can be understood as a “small package” on a truck; although it does not directly participate in the transaction, it can store information, such as:
- Document hash (proof of existence)
- NFT metadata
- BRC-20 token information
This OP_RETURN was originally designed to record simple information, such as on-chain messages. However, 80 bytes is too small to accommodate complex content, yet developers have made significant moves using it. In the spring of 2023, the Ordinals protocol utilized Bitcoin’s Taproot functionality and OP_RETURN to allow users to mint inscriptions and tokens on the blockchain. Inscriptions achieved NFT-like functionality by embedding data into Bitcoin transactions, while BRC-20 further expanded the application scenarios of tokens.
This innovation ignited activity on the Bitcoin chain at that time, even leading to transaction congestion and soaring miner fees, resulting in a wave of inscriptions spring. However, the 80-byte limitation greatly restricts the developmental potential of OP_RETURN, as users cannot upload more complex content (such as larger images or videos), limiting Bitcoin’s potential as a decentralized data storage platform.
Although the proposal itself does not directly mention OP_RETURN, its principle of “flexible relay” could indirectly ease the use of OP_RETURN:
- Reduce node interference with transactions: The proposal advocates that nodes should not refuse to propagate transactions with economic demand. If this principle is adopted, nodes would be more inclined to relay transactions containing OP_RETURN data rather than rejecting them due to data size or type.
- Promote the relaxation of data limits: The spirit of the proposal may lay the groundwork for future relaxation of the 80-byte limit of OP_RETURN. With the adjustment of relay policies, the community may further explore the feasibility of expanding the data capacity of OP_RETURN.
- Enhance transaction propagation efficiency: Even if the data limits of OP_RETURN remain unchanged, the proposal could significantly improve the propagation efficiency of transactions containing OP_RETURN data, avoiding transaction failures caused by node filtering.
The prosperity of inscriptions and BRC-20 tokens once led to record-high miner fee income. If the limitations of OP_RETURN are relaxed, more users will be willing to pay higher fees to upload complex data. This could not only alleviate the income pressure miners face after the halving but also incentivize them to support the new relay policies.
Additionally, it’s worth mentioning that this proposal is relatively easier to accept technically. The adjustments only involve transaction relay policies, rather than the consensus rules of Bitcoin. Relay policies only determine whether nodes propagate certain transactions and only affect the efficiency of transaction propagation without changing the validity of transactions. Therefore, the implementation of the proposal is relatively simple; Bitcoin Core just needs to release a new version, and users and miners can choose whether to upgrade.
With this understanding, let’s go through a practical example to clarify its potential real-world impact. Suppose a user wants to mint a high-resolution NFT image on the Bitcoin chain, but the metadata for the image requires 200 bytes of storage space. Under the current rules and the rules after the Bitcoin Core proposal, you can intuitively see the comparison:
Ultimately, user experience will greatly improve, and miner income will also increase. Bitcoin Core’s proposal may seem like a minor adjustment to the transaction relay policy, but it could be a key step toward “thawing” the Bitcoin network. More importantly, this proposal provides the possibility of relaxing OP_RETURN restrictions, while also enabling businesses to use Bitcoin transactions to store hashes of important documents, ensuring data immutability, thus creating more imaginative space for Bitcoin’s non-financial use cases.
Community Voices
The new proposal from Bitcoin Core has created ripples in the community, with both support and opposition clearly evident. For instance, crypto KOL 0xTodd believes that the flexible relay returns to Satoshi Nakamoto’s unrestricted spirit, allowing miners to gain more income; at the same time, he does not view them as junk transactions, as inscriptions also pay fees based on volume.
Bitcoin will never become a storage chain, but as long as it doesn’t interfere with the underlying protocol, having some data stored as a side job is not a big deal.
Real physical gold can be carved to leave a record; the BTC that everyone calls electronic gold should also be allowed to do the same.
However, opponents are more concerned that the surge of on-chain data will lead to more problems. Beneath the original post from Bitcoin Core, some have criticized the proposal, claiming that Bitcoin Core “ignores the purity of Bitcoin,” turning the network into a “Swiss Army knife” at the expense of volunteer nodes and users’ interests.
Many others worry that flexible relay will lead to an overflow of “junk transactions,” crowding out block space. For example, Luke Dashjr, a core developer from the “hardline faction,” directly responded with “NACK” (no acknowledgment) under the statement, believing that the proposal is misguided, predicting that the mined transactions will be equivalent to censorship, violating the principle of anti-censorship.
Glassnode data shows that the current blockchain has reached 500GB; if data surges, the costs for full nodes will skyrocket, potentially reducing decentralized nodes and pushing the network toward a centralized abyss. Opponents argue that Bitcoin should focus on its monetary function rather than becoming a storage chain.
The community’s division is also reflected in the distribution of nodes. CoinDance data shows that 93% of nodes run Bitcoin Core, while 7% use alternative clients (such as Bitcoin Knots). Knots, due to its “junk filter,” rejects inscription transactions and has become a base for the opposition. If the proposal passes, Knots users may continue to resist, and the risk of a split in potential Bitcoin client usage has already surfaced.
Historical lessons are there; the SegWit2x controversy in 2017 nearly caused a split in the network. Will this debate replay a similar script?
The future’s key lies in community consensus. This debate is far from over. Supporters see hope for miner income and ecological innovation, while opponents defend decentralization and monetary purity. The fate of the proposal depends on code reviews on GitHub and the willingness of nodes to upgrade. If the community reaches a consensus, flexible relay could be implemented in a few months, and the spring of inscriptions may reappear; if divisions deepen, Bitcoin’s ice age may continue, even leading to client forks.
This is a debate not belonging to Bitcoin’s price; the thawing within the Bitcoin ecosystem is still waiting for spring.
This article is a collaborative reprint from: Deep Tide