Bitcoin Just Survived A 'Hostile Takeover' Attempt, Say Michael Saylor And David Bailey — Here's What Happened

David Bailey described it as the first Bitcoin attack “widely fueled by AI slop,” estimating it consumed more than a million human hours.

• The BIP-110 proposal, which sought to ban attaching images and text to Bitcoin transactions, collapsed with under 1% of miner support ahead of activation.
• “Hard consensus is Bitcoin’s immune system,” said Strategy’s Michael Saylor, who pointed out that bad ideas have to fail before they can hurt the network.
• David Bailey said it was a “hostile takeover attempt,” noting a years-long campaign of pressure that resulted in Bitcoin Core developers leaving the project.

The hotly debated soft fork BIP-110 proposal has failed to garner any major network support ahead of its activation deadline, with Strategy (MSTR) Executive Chairman Michael Saylor and Nakamoto (NAKA) CEO David Bailey posting their support for Bitcoin’s (BTC) governance model over the weekend.

“Hard consensus is Bitcoin’s immune system,” Saylor said in an X post on Saturday, without specifically citing the plan. He said protocol changes “must earn overwhelming alignment,” so bad ideas fail before they become what he dubbed “iatrogenic” – damage caused by the intended cure. 

In the post, Saylor defined the network's division of labor: nodes establish policy, miners construct blocks, holders allocate capital, and fees price block space.

Adding to Saylor’s criticism of the soft fork, Bailey referred to BIP-110 as a "hostile takeover attempt" in posts on X, stating that the proposal had failed to attract "even 1% of blocks signaling" on the eve of activation, despite its supporters operating their own mining pool. 

"It was all a lie.” Bailey warned users to exercise caution when instructed to "run my software, or Bitcoin dies," as there is no substantial support from nodes.

What Is The BIP-110 Proposal?

BIP-110 is a proposal that seeks to modify the rules of Bitcoin so that users cannot attach huge amounts of extra data — such as photos or text called inscriptions — to transactions. Supporters argue this data clogs the network, increases costs, and makes the program more expensive to run. 

Critics argue the remedy is faulty and might disrupt sections of the ecology that have been developed around inscriptions. But for the shift to happen, miners need to get behind it. Almost none has done it so far. If its proponents try to push it through when the enforcement window opens around Aug. 7, the network might divide into two incompatible versions of Bitcoin.

Bitcoin Core Engineers Departing The Network

Bailey described the proposal as the culmination of a multi-year pressure campaign involving a rival Bitcoin client, a coercive user-activated soft fork with an unprecedented 55% activation threshold, and an effort to manufacture node consensus. 

He was also accused of a campaign of harassment against Bitcoin Core engineers, which he said caused at least one to leave and others to step back. The allegations could not be independently confirmed.

The episode showed that Bitcoin governance is not decided by any one faction but by an ‘agglomeration of all users’ — individuals, miners, industry and developers, Bailey added.

AI Slop Angle

Bailey also cited what he called a new attack vector. The BIP-110 campaign, he said, was the first on Bitcoin “widely powered by AI slop.” He said that AI-generated material generates confirmation bias and “a single low-effort prompt can take 100x more effort” to rebut. He calculated that the debate had taken more than a million hours of human time in society.

When BIP-110 splits off, supporters “will have destroyed their credibility” and filtered themselves out of the network, making Bitcoin Core better situated, Bailey added. He urged the sector to become more involved in Bitcoin Improvement Proposals, saying that without stakeholder engagement the network defaults “to ossification.”

Bitcoin’s price rose over 0.6% to $62,476 in the last 24 hours. On Stocktwits, retail sentiment around it improved to ‘bullish’ from the ‘neutral’ zone, while chatter dropped to ‘low’ levels from ‘normal’ levels over the past day. 

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