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And then stuff that Bag of Holding into another Bag of Holding, and so on ad infinitum?

Earlier editions of D&D prohibit this. I haven't found similar rules for 5th edition, but perhaps I'm looking in the wrong place.

If putting a Bag of Holding inside another Bag of Holding is allowed, conceivably a player character could carry a king's ransom in gold or an entire army on his back given enough Bags of Holding.

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Yes, but that'll destroy both and create other havoc.

Placing a bag of holding into an extradimensional space created by a Heward's handy haversack, portable hole, or similar item instantly destroys both items and opens a gate to the Astral plane.... (DMG p.154)

So the question, then, is whether a bag of holding, itself, creates such a space and is thus a similar item.

(And it's tempting to think that it's not: the bag's own description doesn't say that the interior is extradimensional, just that it's larger than the outside. For comparison, both the haversack and the hole do explicitly say early in their descriptions that they create extradimensional spaces.)

But the bag does create an extradimensional space. We know this from the descriptions of the handy haversack and portable hole, each of which list the bag of holding as creating one of these dangerously-incompatible spaces.

See DMG pp. 153-4, 174, and 186-7 for all descriptions.

Later, Mearls agrees. Remember, his rulings are not authoritative, but rather are just the word of one very well-informed GM.

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    \$\begingroup\$ Comments are not for extended discussion; this conversation has been moved to chat. \$\endgroup\$
    – mxyzplk
    Commented Jul 14, 2016 at 4:51
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    \$\begingroup\$ "Very well informed" is an understatement. This is a DM that helped design dnd 5e. He knows the rules as intended better than anyone \$\endgroup\$
    – Premier Bromanov
    Commented Jul 15, 2016 at 14:42
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    \$\begingroup\$ well, that's why "very" is italicized =) And I'd say he knows the rules-as-intended better than all-but-one; much of Mearls' time is spent on larger brand-level things, where Crawford's the go-to for rules. I'm just parroting the sort of thing Mearls usually says whenever he's talking about rules: "this is just what my ruling would be; Jeremy's the official guy." \$\endgroup\$
    – nitsua60
    Commented Jul 15, 2016 at 14:49
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    \$\begingroup\$ Sigh, my dreams of a PC carrying a million pounds of loot, or smuggling a thousand soldiers into the enemy castle in a bunch of bags of holding nested inside a single 15 lb bag of holding are squashed. :( \$\endgroup\$
    – RobertF
    Commented Jul 15, 2016 at 15:59
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    \$\begingroup\$ Not squashed, exploded :( \$\endgroup\$
    – nitsua60
    Commented Jul 15, 2016 at 16:32

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