Bitfinity Weekly: The OP_RETURN War

Welcome to Issue #156 of Bitfinity Weekly for our #BITFINIANS community. If this newsletter was forwarded to you, sign up here.

What's in Today's Email?

• Bitcoin Bytes
• Global Crypto News
• In the IC
• This Week in our Blog
• Tweet of the Week
• Infographic Insights
• Meme Time
• A Matter of Opinion

Bitcoin Bytes

Core Issues: Peter Todd, a longtime Bitcoin Core dev (and the subject of HBO's documentary, Money Electric), proposed to remove the limits on OP_RETURN outputs. The highly contentious debate has spilled over from GitHub to X, drawing in commentators from all parts of crypto. On one side, people are vehemently opposed to the removal of existing limits, which they consider essential to keeping Bitcoin functioning as a digital currency. On the other side, people are just as impassioned about removing arbitrary limitations and ushering in a new era of programmability on Bitcoin.

Currently Testing...: OP_NET metaprotocol deployed on Bitcoin testnet this week. The incentivized testnet period is open to traders as well as developers, with dApps available to simulate DeFi functionality such as staking and swapping using OP_NET's token standard OP_20.

Doctor's Diagnosis: Bob Bodily (of OdinFun, Bioniq and Entrepot) released a post-mortem on the security exploit that occurred on April 13th. Although the report is specific to OdinFun only, the incident affected several Runes trading platforms that also utilized third-party smart contracts. 27 total OdinFun users were affected and automatic compensations were issued. The hacker has been identified and OdinFun is working with law enforcement.

Global Crypto News

Standing SOL-o: The Solana Foundation is implementing a new validator strategy to promote self-reliance and boost decentralization. Criticism of Solana has often revolved around centralization risks (57% of Solana validators may fail without Foundation delegation due to high costs). The Solana Foundation is gradually reducing the number of validators it delegates to; for every new validator added, three existing ones (with certain qualifiers) will be removed.

Just Sue It: A class action lawsuit is in the works against athletic wear giant Nike for its actions revolving around RTFKT, its now-shuttered web3 brand. The lawsuit alleges that Nike orchestrated a "brazen rug pull" by using its existing brand and marketing to prop up unregistered securities in the form of the many NFTs it sold. Nike additionally face five counts, including violating trade practices and unfair competition laws under numerous state definitions.

A TON of Debt: Libre and the TON Foundation have launched a $500 million Telegram Bond Fund (TBF) on The Open Network (TON) blockchain, tokenizing part of Telegram's $2.4 billion in corporate debt to provide institutional and accredited investors with on-chain exposure to yield-bearing bonds. The fund is one of the largest institutional RWA (real-world asset) deployments to date. TON is an L1 blockchain initially developed by Telegram, then handed over to the community over regulatory concerns.

Universal Addresses: Ethereum developers are set to finalize two new complementary token standards, the ERC-7930 and ERC-7828, in order to improve interoperability between Ethereum, L2s, and other EVM-compatible chains. This improvement in standards will allow users and apps to unambiguously refer to addresses crosschain, preventing costly errors when sending assets between different networks.

In the IC

Canister Fusion: The DFINITY cross-chain team announced the pre-release of the Solana RPC canister this week. This exciting new development allows ICP to interact with the Solana blockchain via HTTPs outcalls, as part of the Chain Fusion initiative to enhance blockchain interoperability. This canister, managed under NNS control, will facilitating seamless communication with Solana; crosschain devs will not need to manage API keys or JSON RPC providers.

Even Better: OISY wallet's v1.4 release is live, with multiple improvements for enhanced usability across multiple chains. Base and BNB chain now have support and both native tokens and stablecoins are available. Tokens can also be searched by name or symbol, and improved token selectors are now in place to facilitate managing, sending or swapping tokens.

Sleek & Smooth: DFINITY has upgraded the Internet Computer Dashboard to make ICP data more accessible to all users. The revamped Dashboard features improved navigation, a restructured subnets page, and a new ecosystem tokens section for assets like ckBTC and SNS tokens. This update offers clearer insights into network activity, decentralization scores, and highlights community projects. Read more about it on the official blog.

This Week in our Blog

If you're in crypto, you are probably already familiar with stablecoins. But do you know how yield-bearing stablecoins work? In this week's deep dive we explain the basics of yield farming, as well as the context of both TradFi and DeFi strategies.

What are Yield-Bearing Stablecoins and How Do They Work?

Explore the dynamic world of yield-bearing stablecoins and discover how these innovative financial instruments combine stability with passive income opportunities in DeFi.

Bitfinity BlogFred

Tweet of the Week

Infographic Insights

🛡️ Great Code = Secure Code
💡 Top Tips for Shipping Secure Code on Bitfinity

Meme Time

A Matter of Opinion

The Bitcoin community finds itself at a crossroads once again, as a contentious proposal to lift size restrictions on the OP_RETURN opcode sparks intense debate among developers and users. OP_RETURN, a feature that allows small data payloads to be embedded in Bitcoin transactions (currently capped at 80 bytes) has long been a tool for embedding metadata without clogging the network.

However, a new proposal introduced by Bitcoin Core developer Peter Todd, seeks to remove these "arbitrary" limits, reigniting a clash over Bitcoin’s fundamental purpose.

Proponents of the change argue that the current cap is outdated and easily bypassed through Taproot transactions, a method already used by Ordinals. They contend that removing the size limit on OP_RETURN could be beneficial, by reducing UTXO bloat since OP_RETURN outputsprunable, unlike Taproot-based data. This could theoretically streamline the network and make it more flexible for applications that rely on embedded data, such as Runes or other DeFi protocols.

On the other side, critics like Bitcoin Core developer Luke Dashjr warn of dire consequences. Their argument is that loosening restrictions risks transforming Bitcoin into a data storage platform, accelerating the proliferation of non-financial uses, undermining Bitcoin’s core mission as a decentralized financial network.

As discussions unfold on both GitHub and X, the Bitcoin community remains deeply divided. Some view the evolution into a programmable layer as a natural progression, while others fear it dilutes Bitcoin’s original vision. Developers are still weighing whether to merge the change and while consensus is hazy, one thing is clear: the outcome of this debate will shape Bitcoin's future.

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