Michael Saylor Warns on Bitcoin Upgrade as Strategy Halts BTC Buying

Michael Saylor has renewed his warning over Bitcoin’s proposed BIP-110 upgrade as Strategy (formerly MicroStrategy) pauses its aggressive Bitcoin accumulation and instead builds a $3.75 billion cash reserve. According to blockchain intelligence firm Arkham, the company’s latest moves highlight two major developments that could shape Bitcoin and Strategy’s future.

BIP-110, introduced by developer Dathon Ohm and included in Bitcoin Knots, proposes limiting arbitrary data stored in Bitcoin transactions. Miner signaling began in December 2025, while a mandatory lock-in window is expected to open in August 2026. Once active, the proposal would move toward activation regardless of miner participation, making the timeline a key focus for the Bitcoin community.

Saylor argues that changing Bitcoin’s consensus rules threatens the network’s long-term security. He claims BIP-110 could censor legitimate fee-paying transactions, while covenant proposals and larger block sizes may increase security risks, reduce blockspace scarcity, and weaken transaction fee revenue that miners increasingly depend on as block rewards continue to halve.

Supporters of BIP-110 counter that restricting arbitrary data reduces blockchain bloat and preserves Bitcoin’s primary role as a payment network. Blockstream CEO Adam Back has also criticized the proposal, although his concerns focus on its lower activation threshold rather than transaction censorship.

At the same time, Strategy has paused Bitcoin purchases after raising approximately $1.26 billion through stock sales over the past three weeks, including a recent $525 million increase to its cash reserve. The company says the reserve provides roughly 2.1 years of dividend coverage for its preferred shares.

Strategy currently owns 843,775 BTC and still aims to reach 1 million Bitcoin by the end of 2026, leaving a gap of 156,225 BTC. Achieving that target would require purchasing roughly 7,000 BTC per week, yet the company has made no recent acquisitions.

Investors will closely monitor the upcoming BIP-110 timeline, Strategy’s weekly filings for signs of renewed Bitcoin buying, and whether its sizable cash reserve delays any use of its authorized Bitcoin sale program. These developments could significantly influence both Bitcoin price sentiment and Strategy stock performance in the coming months.