Bitcoin’s controversial BIP-110 proposal has suffered a major setback after the minority chain created by its supporters mined only two blocks and then stopped.

The split began at block 961,632, when BIP-110 entered its mandatory-signaling period. The proposal aims to temporarily limit some ways of putting non-financial data on the Bitcoin blockchain.

However, BIP-110 has received very little support from Bitcoin miners. Only 51 of the previous 2,016 blocks had signaled support for the proposal. That represents just 2.53% of the blocks. The proposal needs support from 55% of blocks, or 1,109 out of 2,016, to meet the required threshold for activation.

When the mandatory-signaling period started, Bitcoin nodes running BIP-110 began rejecting blocks that did not signal support for the proposal. Regular Bitcoin nodes continued to accept both signaling and non-signaling blocks. This created two competing chains.

The BIP-110 chain produced two blocks, at heights 961,632 and 961,633. The blocks were attributed to miners using OCEAN’s mining protocol.

After the second block, however, the minority chain stopped making progress. At around 6 AM UTC on Sunday, the main Bitcoin chain had reached block 961,681, while the BIP-110 chain was still at 961,633. That meant the two chains were already 48 blocks apart.

The gap later became even larger. The main chain reached block 961,757 and kept growing, while the BIP-110 branch remained stuck at 961,633. The reason for the slowdown is simple: the BIP-110 chain has very little mining power.

The minority chain inherited Bitcoin’s existing mining difficulty. But because only a tiny amount of computing power was mining on it, new blocks were taking several hours instead of the usual 10 minutes.

Bitcoin normally adjusts its mining difficulty every 2,016 blocks. The BIP-110 chain must complete that same period before it can make a major difficulty adjustment.

Because the chain is moving so slowly, estimates suggest it could take around 350 days to reach that point. The main Bitcoin network, by comparison, was expected to complete its adjustment period in about 14 days.

The drop in hashrate is attributed in part to some of the largest miners supporting the BIP110 campaign halting their mining operations.

One of them is Roughnecks Mining. The mining team announced on X that, after mining two blocks on the BIP110 chain, it held a team meeting and decided to stop mining.

Another group that has halted mining is PyBlock. The group announced on X that it had been advised to halt its mining operations “until further notice.” PyBlock added that it would continue mining “completely clean blocks with zero spam,” as it did before BIP-110.

Roughnecks added that it decided to stop mining the new split chain for now, arguing that continuing would largely be a waste of resources because it cannot match the hashrate of the other miners.

Meanwhile, Bitcoin developer Giacomo Zucco offered suggestions for where the BIP-110 movement could go following the halt in miner signaling.

Rather than pursuing a hard fork that changes Bitcoin’s proof-of-work (PoW), he suggested that supporters focus on building alternative implementations, contributing to Bitcoin Core, working toward broader consensus for changes to Bitcoin’s consensus rules, and promoting greater mining decentralization.

Zucco framed the choice as either doubling down on a PoW-changing hard fork or returning to the more difficult, but still possible, task of building support for the changes advocated by BIP-110.

BIP-110 stands for Bitcoin Improvement Proposal 110. It was developed by the pseudonymous Bitcoin developer Dathon Ohm. The proposal would introduce temporary restrictions on certain types of data that can be stored in Bitcoin transactions.

For example, it would limit most new output scripts to 34 bytes and cap OP_RETURN outputs at 83 bytes. It would also place limits on certain data pushes and witness elements and temporarily restrict some Taproot features. The proposed restrictions would remain in place for about one year.

Supporters say the changes would reduce the use of Bitcoin for storing pictures, text, inscriptions and other non-financial data. They argue that this type of activity can use valuable block space and increase storage and bandwidth costs for people running Bitcoin nodes.

Critics disagree. They argue that users who pay transaction fees should be able to use Bitcoin’s block space as they choose. The proposal has also faced opposition from prominent figures in the Bitcoin industry.

Strategy Executive Chairman Michael Saylor has said he supports some of BIP-110’s goals but believes its approach could threaten Bitcoin’s neutral rules and consensus. Blockstream CEO Adam Back has also warned about the possible consequences.

Critics fear that the proposal could divide the Bitcoin network and create uncertainty for users.

The BIP-110 mandatory-signaling period runs from block 961,632 through block 963,647. If an enforcing chain reaches block 963,648 under the required conditions, it would enter a locked-in state. The proposed transaction restrictions would then become active at block 965,664.

For now, however, that doesn’t seem to be happening. The biggest problem for BIP-110 supporters is finding enough miners to keep their chain alive.