BIP-110 May Trigger Bitcoin Fork Risk: Developers Warn Selling Forked Coins Could Result in Theft of Real BTC

Bitcoin developer Kevin Loaec warned that if a Bitcoin fork tied to the controversial BIP-110 proposal occurs this weekend, holders selling tokens from the forked chain may face the risk of their actual BTC being drained. Reports note that if Bitcoin splits into two chains, users’ BTC balances will exist on both chains. Some traders may attempt to sell seemingly "free" forked coins, but due to the lack of replay protection in the early stages of both chains, transactions signed when selling forked coins could be replicated on the original Bitcoin network, resulting in buyers receiving an equivalent amount of actual BTC. Loaec stated that without understanding how to safely split assets across the two chains, the safest option for holders is to refrain from any actions for now. Unmoved BTC will not be vulnerable to replay attacks, as there are no signed transactions to replicate. This risk stems from the BIP-110 proposal, which aims to restrict non-payment data such as images and text from being included in Bitcoin transactions. Lacking sufficient miner support, software backing BIP-110 may start rejecting non-compliant blocks from the expected block height of 961,632 this weekend, leading to a fork competing with the main chain. Currently, miner signaling support for BIP-110 stands at around 2.6%, far below the threshold needed for activation, so it remains uncertain whether a fork will actually materialize. However, if a small number of miners continue to maintain the BIP-110 chain, two separate transaction histories could emerge in the market. Analysts note that in the early stages of a fork, users need to proactively isolate their assets; otherwise, transactions involving forked coins could accidentally transfer actual BTC due to the lack of replay protection. The BIP-110-related transaction restrictions are expected to take effect around early September.