I asked AI Agent to explain the op_return debate. I understand the Knots side but was having trouble with the Core side.

It’s about a free market side….Martin Luther or an Orthodox side …. fish on Fridays.

⚔️ Bitcoin Core vs. Bitcoin Knots: The OP_RETURN Debate

🔹 What is OP_RETURN?

OP_RETURN is a Bitcoin script opcode that allows embedding small amounts of arbitrary data in transactions. It’s prunable (not stored in the UTXO set) and used for things like digital certificates, time-stamping, Layer 2 protocols, NFTs, and more.

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🟧 Bitcoin Core’s Position

• Increasing the OP_RETURN limit: Developers like Peter Todd have proposed removing or significantly raising the 80-byte data limit.

• Why?

• OP_RETURN is non-spendable and prunable, so it doesn’t increase the size of the UTXO set (unlike hacks using fake addresses).

• Allowing more data via OP_RETURN encourages cleaner, safer use of the blockchain rather than misusing payment outputs for data.

• Fee markets, not arbitrary limits, should discourage spam. If someone is willing to pay high fees for data, the network should allow it.

• Encourages innovation in decentralized applications and protocols that rely on blockchain data.

⚖️ Ethos: Let the market decide, reduce incentives for dirty hacks, don’t artificially restrict use cases.

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🟩 Bitcoin Knots’ Position

• Maintains stricter limits on OP_RETURN than Bitcoin Core.

• Associated with developers like Luke Dashjr, who strongly oppose using the Bitcoin blockchain for non-financial data.

• Why?

• Even prunable data increases bandwidth and validation load, which can hurt decentralization.

• Permissive data embedding can lead to abuse, like Ordinals, NFTs, or arbitrary content (e.g., memes or files).

• Limits preserve Bitcoin’s role as a monetary protocol and protect its long-term scalability.

• Believes in protocol-level filtering of misuse rather than relying only on economic incentives.

⚖️ Ethos: Bitcoin should be a secure, minimal, financial-only ledger — not a general-purpose data layer.