I use double space to insert "y"
(I use it to insert "y" in the search field in Safari's browser)
It works fine but if I copy something to the chipboard, then I double space, whatever I have in the clipboard it gets tagged with "y" so if I have "cars are fast" in the clipboard, then it pastes as "cars are fasty"
It only works again if I restart BTT, starting BTT clears the clipboard.
if you just want to output y, it would be better to use the standard shortcut sending functionality in BTT (the first category in the predefined actions list).
If you are using the paste /type action and insert @selection, it will either replace that with the currently selected text, or if nothing is selected it will replace it with the clipboard contents