Re: [bitcoindev] Relax OP_RETURN standardness restrictions

[Sjors Provoost <sjors@sprovoost.nl>]

> Op 17 apr 2025, om 20:52 heeft 'Antoine Poinsot' via Bitcoin Development Mailing List <bitcoindev@googlegroups.com> het volgende geschreven:

> Developers are now designing constructions that work around these limitations. An example is Clementine, the recently-announced Citrea bridge, which uses unspendable Taproot outputs to store data in its "WatchtowerChallenge" transaction due to the standardness restrictions on the size of OP_RETURNs[^0]. Meanwhile, we have witnessed in recent years that the nudge is ineffective to deter storing data onchain.
> 
> Since the restrictions on the usage of OP_RETURN outputs encourage harmful practices while being ineffective in deterring unwanted usage, i propose to drop them. I suggest to start by lifting the restriction on the size of the scriptPubKey for OP_RETURN outputs, as a first minimal step to stop encouraging harmful behaviour, and to then proceed to lift the restriction on the number of OP_RETURN outputs per transactions.

It might be better to do both, if only to avoid repeating the discussion in a year.

From perusing the Citrea paper (page 18) it seems a single output is enough, and they only need 144 bytes.

1. Regarding size

The current ~80 byte limit was based on Counterparty needing it [0], and otherwise using bare multisig. A similar argument would apply here. At the time there was discussion about how much space Counterparty really needed if their protocol was well implemented.

The 144 bytes consist of a Groth16 proof and the total chain work. Along similar lines we could pick a number based on various cryptographic commitment schemes, and then only raise the limit by that much.

But that just guarantees repeating the argument in a year when some protocol needs a slightly higher limit. In a post-inscription world that seems pointless. My preference is to drop the size limit entirely.

2. Regarding count

IIUC there's no consensus limit on the size of an OP_RETURN [1] and there's also no standardness rule on the size of a scriptPubKey. The size of a single OP_RETURN is limited only by the maximum transaction size, i.e. 100 kvB.

Without a size restriction on individual OP_RETURN outputs, there's no point in limiting their number.

That said, it would be interesting to know if any protocols are thinking of using multiple OP_RETURN outputs.

3. Reminder why we didn't do this earlier

In the August 2023 discussion [2] Murch wrote, in response to John Light:

>> is there ever a case where using OP_RETURN to embed data actually results in fewer bytes onchain than embedding the same data using the segwit/taproot witness space
> 
> Yes, a back-of-the-envelope calculation has me thinking that only payloads of 135 bytes would be cheaper with transcriptions than with nulldata outputs. In detail:
[...]
> we learn that nulldata outputs are cheaper up to a payload size of 134 bytes, only above that inscriptions become a more blockspace efficient data carrier.

Since we're discussing raising the limit to at least 144 bytes, the above argument would no longer be relevant.

And from what I recall at the time that was the only remaining reason to keep the OP_RETURN restrictions around a bit longer, despite heavy use of inscriptions.

4. PS - on liveliness assumptions

The paper [3] states the following assumption:

> We consider a secure ledger, i.e., a ledger that is safe and live. Safety and liveness are defined as follows:
> 
> ...
> 
> Definition 2 (Liveness). A distributed ledger protocol is live with liveness parameter u if all transactions written by any correct party at round r, appear in the ledgers of all correct parties by round r + u.

For standard transactions this already not trivially true. See all of Lightning pinning discussions.

For non-standard transactions, does BitVM2 keep all its transactions under 100 kvB?

Otherwise your liveness assumption requires a direct connection to at least one miner / pool that is trusted to not censor (though you can shop around until the deadline).

Conversely, having actively used protocols that frequently require going over some standardises limit puts pressure on that limit for the reasons Antoine outlined. So for anyone working on such protocols, please let this list know, since these discussions can take a while.

- Sjors

[0] https://www.reddit.com/r/btc/comments/80ycim/a_few_months_after_the_counterparty_developers/?rdt=53592
[1] https://bitcoin.stackexchange.com/a/117595/4948
[2] https://gnusha.org/pi/bitcoindev/03551f0f-272e-2607-e95a-8ec671cbb9f3@murch.one/#t (click on the html attachment)
[3] https://citrea.xyz/clementine_whitepaper.pdf

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