I agree that OP is confusing / conflating a bunch of different things.
But to clarify that one bit (I think?) they're talking about -- the code is OP_RETURN. Originally it could return larger amounts of arbitrary data, which was used to effectively store external data on-chain. It was later reduced down to only allow 40 bytes, which would be enough for a hash, but not enough to store larger amounts of state.
This was what Vitalik Buterin and others were using for things like scripting and colored coins, and Vitalik cited (concerns that devs were threatening to constrain it / remove it as a major reason he started Ethereum.
But to clarify that one bit (I think?) they're talking about -- the code is OP_RETURN. Originally it could return larger amounts of arbitrary data, which was used to effectively store external data on-chain. It was later reduced down to only allow 40 bytes, which would be enough for a hash, but not enough to store larger amounts of state.
This was what Vitalik Buterin and others were using for things like scripting and colored coins, and Vitalik cited (concerns that devs were threatening to constrain it / remove it as a major reason he started Ethereum.
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Vitalik about OP_RETURN (wish I had link w/ more context) - https://twitter.com/vitalikbuterin/status/929808394487320577