BIP-110 Soft Fork: What Corporations Need to Know About Chain Splits and Settlement Uncertainty

As Bitcoin's BIP-110 soft fork approaches its activation boundary, corporations need to be aware of the potential impact on their operations. The proposal is set to enter mandatory signaling at block 961,632 around August 9, 2026, and will lock in no later than block 963,648, roughly in late August.

For most corporations, BIP-110 requires little to no action, as the typical corporate Bitcoin utility is as a store of value. Standard on-chain payments remain compatible with the new rules, while ordinary Lightning payments occur off-chain. However, corporations that run their own full nodes have a direct choice and should switch to running BIP-110 if they support it.

A key factor for corporations to be aware of is chain splits, which can occur when miners build a non-compliant chain. In this scenario, BIP-110 nodes may separate from the broader network, while non-BIP-110 nodes continue following the higher-work branch. Miners should direct their hashrate based on their view of which branch will end up with the most accumulated proof of work.

Exchanges and custodians should prepare for settlement uncertainty by lengthening confirmation times and monitoring both branches. In the event of a chain split, operators should wait until both branches reach the requisite confirmations before considering a transaction final. This is to prevent double-spending risks.