Greg Maxwell Warns 'The Cat' Proposal Could Undermine Bitcoin's Censorship Resistance

The Bitcoin development community has found itself at odds over a contentious improvement proposal dubbed ‘The Cat,’ which seeks to combat network bloat by permanently marking and removing millions of small UTXOs from circulation. The debate reveals a fundamental tension between pragmatism and principle within the ecosystem.

The Problem at Hand

Bitcoin’s UTXO set has become increasingly cluttered, with spam transactions—primarily ordinals and inscriptions—comprising 30% to 50% of all unspent outputs. This proliferation strains node resources and makes blockchain maintenance more expensive for full node operators. Proponents of ‘The Cat’ view the proposal as a necessary economic correction to discourage frivolous transaction patterns.

The Opposition’s Core Concern

However, the proposal has drawn sharp criticism from seasoned developers, notably Greg Maxwell, who raises a critical objection: the precedent such action would establish. Maxwell warns that once Bitcoin accepts the principle of marking assets as “permanently unspendable” at the consensus layer, it crosses a dangerous line. The concern extends beyond technical efficiency—it strikes at what many consider Bitcoin’s foundational principle: censorship resistance.

The Fundamental Disagreement

The real divide centers on whether Bitcoin should ever be engineered to invalidate existing UTXOs based on consensus-layer rules. Supporters argue this is simply removing garbage that pollutes the network. Opponents counter that this opens the door to future “asset seizure” mechanisms, where community consensus could dictate which transaction outputs remain valid—a power that directly contradicts Bitcoin’s resistance to arbitrary control.

The ‘The Cat’ debate thus transcends a technical dispute about blockchain optimization. It represents a philosophical battleground over whether efficiency should ever compromise Bitcoin’s core immunity to censorship.