Bitcoin outlook, 2026-09-03

A few weeks ago we wrote that BIP-110 had failed but that its supporters had not stood down. The saga has now cost a founder his company. On August 29, OCEAN and Luke Dashjr published a joint statement: separation by mutual agreement, Dashjr resigning as chairman, CTO and director, and the company buying back all of his equity for an undisclosed amount. The stated reason is careful and telling at once: "different visions for the future of Bitcoin mining, following recent protocol developments." The statement does not say which developments. It does not need to.

For readers who do not follow mining closely: OCEAN is not just another pool. Dashjr launched it in late 2023 with Bitcoin Mechanic, backed by a $6.2 million raise led by Jack Dorsey, to attack a specific problem, pools quietly becoming intermediaries with real power over miners. Its answers were structural: miners paid directly in the coinbase transaction so the pool never holds their funds, everything publicly verifiable, and with DATUM each miner able to build its own block template. The company's entire reason to exist is decentralizing the mining of Bitcoin as it is.

Which is precisely what stopped fitting under one roof. Its co-founder now pursues, through Bitcoin Knots, the endgame we covered two weeks ago: replacing Bitcoin's SHA-256d proof of work with BLAKE2b on the branch he champions. And that project left the drawing board. On August 29 Dashjr announced a mainnet rehearsal with a Bitcoin Knots release candidate, explicitly asking SHA-256 miners to stop mining before the switch; the chain activated from block 961,640, and by September 1 the next release candidate hardcoded that checkpoint, its supporters declaring it officially accepted. The new chain now produces its own blocks, with its first difficulty retarget falling 41.3 percent, and by construction the SHA-256 ASICs securing Bitcoin cannot simply point at it. A company whose business is Bitcoin's miners, and a chairman whose project makes their machines obsolete on his preferred chain: the separation announcement reads as the only possible ending.

Dashjr is not leaving the industry; his next venture, CONVOY, promises in the statement's words to continue the mission of decentralizing mining. Which chain's mining, the statement does not say, and that is now a genuinely open question. What can be said today is what the market has said: Bitcoin's price, hashrate economics and fee market have carried on as if the fork were a rounding error, exactly as they did when the first attempt died in two blocks. A chain exists; an economy for it does not, yet. Our standing conclusion from August holds: forks are cheap, the users, exchanges and capital that make a chain worth securing are not.

The market kept to its range: Bitcoin trades near $77,900, still below $80,000, still holding every dip above the $75,600 line our Sunday note set as the bears' burden. Our three horizon views are unchanged, refreshed today with the same views on all three horizons.

This is general market commentary, not investment advice or a recommendation to buy or sell any asset.