Why Bitcoin
- Brian Rast
- Sep 9, 2019
- 40 min read
Updated: May 6
Originally published September 2019 — fully updated May 2025
You’ve heard about it: Bitcoin. But what’s the big deal?
Why does it have value? What might that value be? And why should anyone consider buying some and including it in their portfolio?
Parts of this argument have been made in countless places online (some of the best material I know of is linked here). My goal is to synthesize both an introduction to Bitcoin and a bullish case for investing in it. This piece is written for people who haven’t spent much time in the space, though I believe there’s something here for everyone—especially if you explore the linked material.
I’m not an engineer or programmer. That means I won’t be diving deep into the technical workings of Bitcoin. But that’s okay. I don’t believe a deep technical understanding is essential to grasp the case for Bitcoin. Investing in it is more an economic and financial exercise than a technical one. You should generally invest in things in proportion to how well you understand them. So because I think Bitcoin is worth owning, let’s start with understanding what it is and why it might matter.
Despite my bullish outlook, this isn’t financial advice. Nobody knows what’s going to happen, especially with something as complex and emergent as Bitcoin. (Anyone who claims to know for sure is probably also trying to get some of your money.) And of course, everyone’s financial situation and risk tolerance are different.
I'm just a guy with an opinion.
First things first: What is Bitcoin?
If you don’t really know what Bitcoin is, there’s a wealth of material online that explains it. I’ll provide a basic overview here, and if my article sparks your curiosity, I highly recommend digging deeper.
Bitcoin operates as a decentralized digital currency, powered by a global peer-to-peer network. At its core is the blockchain, a public ledger that permanently records every confirmed transaction. Bitcoin wallets maintain private keys—secret cryptographic data—that authorize and digitally sign transactions, proving the owner’s identity, preventing alterations, and ensuring that each Bitcoin spent is legitimately owned.
Transactions broadcast to the Bitcoin network are grouped into blocks and validated through a process called mining, typically within approximately 10 minutes. Mining is a competitive, decentralized consensus mechanism wherein specialized computers solve complex cryptographic puzzles. Successfully solving these puzzles allows miners to add blocks of verified transactions to the blockchain, securing the network against manipulation or fraud by enforcing chronological order.
Mining serves multiple purposes: it confirms pending transactions, maintains the neutrality and integrity of the blockchain, and issues newly created bitcoins according to a predetermined inflation schedule. The difficulty of these cryptographic puzzles ensures no single individual or group can dominate the blockchain or alter past transactions. This distributed, self-regulating structure makes Bitcoin uniquely secure, censorship-resistant, and trustless—eliminating reliance on centralized intermediaries.
tl;dr: Bitcoin is essentially a decentralized ledger.
You transact value on that ledger — down to satoshis (the smallest divisible unit, 1 / 100millionth of a Bitcoin) — directly with other people, without needing a trusted third party such as a bank, PayPal, or credit card company to process the transaction.
Very simply: that’s Bitcoin. Bitcoin is a decentralized, scarce, censorship-resistant digital money—and the first monetary asset engineered for the internet age.
It's permanent. It’s growing. It’s a cathedral of the digital age. The foundation was laid in its early years, and block by block, it has expanded—stored redundantly across nodes worldwide. This digitally permanent ledger becomes powerful when people treat it as valuable: as a medium of exchange, unit of account, store of value, asset, and money.
OK but.. why is Bitcoin valuable?
Clearly the right question to ask next, and I will spend many sections answering this question more fully.
But for starters understand that now with Bitcoin we can do all of that—transact, store, save—on a secure system with a fixed inflation schedule that isn’t controlled by any single entity.
Bitcoin is valuable because there is no singular point of failure for counterparty risk. With Bitcoin you don't need to pay a 3rd party to exist (structural business costs, bank wire fees, credit card fees and interest, etc...), and that means you also avoid the potential for censorship or control. Bitcoin is not controlled by anyone, making it censorship-resistant. It is also extremely secure.
To be clear: nearly all Bitcoin-related theft stems from user error or from centralized companies being incompetent or dishonest—not the protocol itself.
Bitcoin transactions are final. They’re not reversible. That finality can make using Bitcoin intimidating, especially to new users. But that finality is also what guarantees their security: if a transaction is made, it can’t be undone without another one. You know when bitcoin is transferred it will not be returned without another transaction. And this finality becomes incredibly powerful in a world where autonomous agents (including AI) are transacting, settling, and coordinating value. Final, neutral settlement becomes a prerequisite.
This is a cool chart which shows a potential growth outline of Bitcoin from inception to full blown Global Money.
Bitcoin is intended to be a decentralized, digital form of money. But it’s not there yet. Most businesses don’t accept it. Most people don’t use it. It can be clunky to invest in. And yes, it’s still been volatile as a store of value.
But it’s on a path.
The biggest thing holding Bitcoin back right now is lack of legal clarity and universal acceptance. Think of it like a network: it needs adoption to grow.
Is Bitcoin too slow?? The Tortoise & The Hare
One of the most common criticisms of Bitcoin is that it can’t currently process enough transactions—not even close to what VISA handles daily. This even became a central debate within Bitcoin years ago and led to the Bitcoin Cash hard fork (an interesting rabbit hole but beyond the scope of this article).
If Bitcoin can’t function as a peer-to-peer digital cash system today, how can it be “money”?
My take: Bitcoin’s most valuable property was never speed. And frankly, it may never be used primarily for buying coffee or lunch. USD, Euros, and other fiat currencies—especially when paired with credit cards and apps—already handle daily payments extremely well.
So it’s a valid question: "Brian, why do I need another internet money to buy things?"
Short answer: You don’t.
You don’t need a decentralized blockchain for small retail transactions. You just want something fast, easy, and trusted. And in rich countries with strong currencies, the existing tools work fine.
But now think bigger.
There are over a billion people worldwide who don’t have access to bank accounts—but do have phones. Bitcoin may be a better option for many of them, even without VISA-level transaction speeds. Especially if the Lightning Network (and other layer-2 solutions) continue to evolve.
So while Bitcoin can’t yet handle global-scale daily purchases, it already can replace international remittance. Think less “buying coffee,” and more “sending money across borders without middlemen.” Compared to bank wires or Western Union, Bitcoin is cheaper, faster, and doesn’t require permission.
Now—some argue Bitcoin still can’t scale like other cryptos with higher transactions-per-second (TPS). And they’re right… by design.
Bitcoin has intentionally limited block size to preserve decentralization. That decision protects the network from becoming too reliant on large-scale server farms or centralized infrastructure. It’s a tradeoff, and an important one.
Bitcoin is the tortoise.
Bitcoin Cash and others are the hare. Slow and steady wins this race. Or more accurately, I’d argue: Bitcoin already won.
And the problem with framing Bitcoin as just “another form of digital cash” is that it grossly understates its value.
It’s like picking up an iPhone X and saying, “Hey, it makes calls anywhere!”
Well, yeah… so did my flip phone in 2006.
The iPhone isn’t impressive because it makes calls. It’s impressive because it’s a camera, a GPS, a computer, a social device, an app platform—a thousand tools in your pocket. Same with Bitcoin.
Yes, it can transmit value. But that’s the least interesting part.
Bitcoin is programmable money.
Bitcoin is decentralized property.
Bitcoin is incorruptible settlement infrastructure.
Bitcoin is a savings technology.
Bitcoin is more.
Bitcoin does not derive most of its value from simply being an alternative currency. And I am going to ask you to imagine something that is not precisely like anything else that has come before it. Bitcoin does not neatly fit in to an explanatory compartment and category that has already existed. It is something new, something that blends many different ideas in to one thing. So open your mind, take the red pill, and follow me to see how deep this rabbit hole really goes.
Through the Looking Glass: Transparent Supply
If Bitcoin’s most valuable property isn’t fast transaction speed, what is?
In my view: programmed scarcity.
Bitcoin was created with a transparent, predictable inflation policy. Every 10 minutes, new bitcoins are mined and rewarded to the computers that process transactions. This block reward gets cut in half approximately every four years.
That halving process means the number of new bitcoins entering the system slows down exponentially. Eventually, there will essentially be no new supply.
As of May 2025, roughly 19.7 million bitcoins have already been mined. The maximum supply is capped at 21 million. That means only about 6% more bitcoin will ever be created—ever.
Compare that to your local fiat currency, where supply is determined by central banks influenced by politics, special interests, and short-term goals. Monetary policy can shift on a dime. Bitcoin’s can’t. It’s fixed in code and enforced by the network.
Now, there’s plenty of debate around monetary inflation and its real-world impact. Some argue that central bank stimulus hasn’t created visible inflation. But I believe that the massive increases in money supply — via QE and deficit spending — have been silently eroding the purchasing power of fiat currencies. Whether it shows up in consumer prices or asset inflation, the result is the same: your dollars buy less.
Here is a chart of the global money supply over the last 30 years, followed by a chart of bitcoin supply:
Fiat supply is expanding and at the whims of governments and politicians.
Bitcoin supply is contracting and set on a programmed future curve.
Which of those would you rather hold long-term?
(Not a trick question.)
Global Debt Spiral & Multipolar Reality
Today’s monetary policy playbook: low interest rates, loose credit, massive stimulus. This has driven up asset prices across the board—real estate, equities, even college tuition and healthcare costs. Meanwhile, savings accounts yield nothing. Bonds are underwater. The dollar buys less.
Technology hides some of this. TVs are cheaper and better, sure. But strip out tech deflation and you see real inflation on everything else people actually need: housing, medicine, education, assets with real-world scarcity.
The United States isn’t alone. Globally, the sovereign debt crisis is already unfolding, quietly but relentlessly. Japan’s debt-to-GDP ratio sits at an eye-watering 260%, Italy at nearly 150%, and China’s rapid accumulation of debt—both public and private—raises concerns about its long-term stability. Emerging markets like Turkey, Argentina, Nigeria, and Lebanon are facing outright currency collapse or severe financial distress—many relying on bailouts or IMF intervention just to stay afloat. Global government debt-to-GDP stands at 93%—already a red flag for fiscal sustainability. But total global debt, including households, corporations, and governments, has surged past $315 trillion, reaching 333% of global GDP. That figure has risen 21% since 2020, fueled by massive COVID-era stimulus and easy credit across sectors. This isn’t just a government problem. It’s systemic—and it’s everywhere.
The national debt in the United States has exploded past $34 trillion. In 2025, the U.S. is projected to spend approximately $952 billion on net interest payments—set to surpass defense spending and become the second-largest federal expenditure behind Social Security. This figure represents about 3.2% of GDP, up 8% from the previous year. I consider the interest payment to be the canary in the coal mine. We’re trapped in an accelerating spiral of debt issuance just to cover the interest on previous debt. That’s not sustainable. It’s a slow-motion train wreck.
We are witnessing a global experiment: governments attempting to sustain growth through unsustainable borrowing. Interest payments are ballooning everywhere, diverting critical resources away from productive investment and infrastructure toward servicing past debts. It’s a global treadmill of borrowing to pay for borrowing, with no clear end in sight—and the velocity constantly increasing. When will the runner fall off the back?
At the same time, U.S. geopolitical dominance and dollar hegemony are gradually but undeniably eroding. The world order is shifting toward multipolarity, with rising economic blocs like the BRICS nations—Brazil, Russia, India, China, and South Africa—actively diversifying away from the dollar in favor of bilateral trade agreements and alternative reserve assets. Central banks globally bought record amounts of gold in recent years, signaling a strategic move away from complete dependence on the U.S. dollar.
In this environment, neutral, non-sovereign assets become indispensable.
But what about Gold?
In an inflationary macro environment marked by runaway spending and expanding money supply, scarce assets hold real appeal. And gold fits the bill. It’s tangible. It’s rare. It’s been trusted for thousands of years across cultures and regimes. In an increasingly multipolar world where trust in governments is fading, gold makes sense. It’s a saver’s asset. So why not just invest in gold?
Bitcoin does not have that kind of historical track record, obviously, at 12 years young.
Gold does have industrial and aesthetic uses (jewelry). Bitcoin doesn't.
But gold is terrible to move, divide, or spend. Bitcoin is excellent at all three. And Gold supply rises with demand - more mining equals more gold. Not to mention the potential for massive gold deposits to be found in the solar system in the near future. Bitcoin's supply doesn't care what price is, and there is no way to mine more.
That last one is huge. Gold is scarce, but Bitcoin is absolutely scarce. Fixed. Unchangeable. No amount of demand will create more than 21 million.
So while gold has served as a store of value for millennia, Bitcoin is strictly superior for the digital age. If it gains broader adoption as a store of value and reserve asset, it could displace gold’s role as a Store of Value entirely.
Also, while Bitcoin is often called “digital gold,” that undersells it. Gold just sits there—Bitcoin can move, settle, and speak code. It’s not just scarce—it’s programmable, global, and built for the internet age. 77% of investors under 40 prefer Bitcoin to gold in one survey. In the picture below, you can see the biggest discrepancy between 21-43 year olds & 44+ is crypto.
This generational shift won’t happen overnight. As Svetski argues in his Three Generations Theory, it may take the old guard - those who still trust gold implicitly - to age out, and for younger generations who were raised around Bitcoin to take over. 65 year old gold holders aren’t changing their minds;
Bitcoin is winning by outlasting them.
Self-fulfilling prophecy conundrum
In a very real sense, Bitcoin requires belief. People must recognize its value as a scarce, programmable asset—like gold, but with far more utility. I can argue for that utility, as I’ve been doing. But ultimately, money and assets are what people collectively agree they are.
This is the self-fulfilling prophecy at the heart of Bitcoin.
And yes, there are theoretically infinite other crypto coins with similar properties. So the obvious question becomes:
What makes Bitcoin special?
Why not buy another crypto coin that's much smaller?
Why buy any cryptocurrency at all??
Let’s take this head-on.
The Bitcoin moat
Bitcoin isn’t just a coin. It’s a protocol, a network, a belief system, and a first-mover that has grown into a fortress.
Here’s what sets it apart:
Age – At 16 years old (as of 2025), Bitcoin is ancient in crypto time.
Decentralization – No founder. No company. No central point of failure.
Security – Proven resilience securing trillions of dollars in value.
Lindyness – The longer it survives, the more likely it is to keep surviving.
Shared belief – The most important moat of all.
Gold isn’t valuable because it’s useful. It's valuable because we all agree it is.
Same with Bitcoin.
Humans assign value to things all the time—paintings, metals, shells, dollars. That shared belief creates reality. And once belief hits a tipping point, it rarely goes backward. As Robert Frost put it: “Way leads on to way, and we seldom come back.”
Bitcoin’s belief layer—that shared consensus—is already the strongest in the crypto space. And belief compounds.
Other cryptocurrencies may have novel features or faster speeds, but they don’t have Bitcoin’s moat. They don’t have its security, its decentralization, or its narrative gravity.
Nobody Backs Silly Worthless Magic Internet Money
But wait—who backs Bitcoin?
It’s just numbers on a ledger. It isn’t backed by gold, or a government, or anything tangible. How can that be valuable?
This is where most people get tripped up—and where they start to see the deeper truth.
It’s true that no central authority backs Bitcoin. But it’s also true that all authority, including governments, derives power from the consent and belief of the people within the system.
The U.S. government backs the dollar, yes—but what gives the dollar actual value is the fact that we all accept it. We use it, pay taxes with it, and trust that others will take it too. That collective belief is the real engine.
Bitcoin works the same way—except it doesn’t require a government to enforce it. Its value comes from utility and acceptance. People find it useful. People believe in it. And it works.
In fact, while some see the lack of a central backer as a weakness, I see it as a feature, not a bug.
Instead of being dependent on a single government or institution—any of which can fail—Bitcoin spreads power across the entire network. No one is “in charge.” There’s no CEO, no kill switch, no printing press. The system is secured by Proof of Work, maintained by miners, and verified by nodes run all over the world.
There’s no single point of failure. That makes it the most robust monetary system we’ve ever had.
What is money, really?
At its core, money is only worth something because someone else will accept it in a trade. Money by itself is usually useless. It’s a shared illusion—an efficient placeholder that lets society move beyond bartering.
There’s nothing inherently “better” about a currency just because a government prints it. That might create perceived stability, sure—but history is littered with governments that inflated their currencies into oblivion: the Weimar Republic, Zimbabwe, Venezuela. The list goes on.
This isn’t a new idea. In fact, the U.S. dollar itself hasn’t been “backed by gold” since 1971, when President Nixon ended the Bretton Woods system and closed the gold redemption window. That move officially turned the dollar into a fiat currency—one backed not by metal, but by belief, military power, and network effects. Ever since, the dollar—like all modern currencies—has floated on trust alone.
And let’s be real: states can and do fail. And when they fall, their currencies usually go down with them.
Zoom out far enough, and you realize:
As great as Rome was, it still fell.
Historically all empires and nations have fallen and been dissolved, consumed, or conquered.
Bitcoin has no empire. No nation. No sword to fall on.
It's just the math. The network. The ledger. And the belief. That’s its power. Bitcoin is the truth in this regard.
It's a self-fulfilling prophecy of the inevitable march of monetary soundness.
Some have seen it. One day more will see it. Then all will see it.
Humanity has NEVER had a money like this. A money with no singular point of failure. A money where there is a defined future inflation which trends to zero. I repeat: there will only ever be 6% more Bitcoins produced than the current supply contains (19.7M mined, 1.3M remaining)
Bitcoin is simply the best way to save. Because of the scarcity, Bitcoin rewards savers more than any other asset ever has.
Bitcoin: the Fort Knox of asset security
And there’s more.
I’d argue Bitcoin is also the most secure asset humanity has ever created.
Not only can your bitcoin not be hacked—it can’t be seized. Not without your consent.
Someone could put a gun to your head, and you still wouldn’t have to give them your bitcoin. Everything else you own—cash, real estate, gold, stocks—can be taken by force or frozen by a third party. Your home can be seized by the government. Your bank account can be drained. Your safe deposit box can be opened. Even if you were willing to die to stop it, most assets can still be taken from you.
But with Bitcoin, your consent is required.
That doesn’t mean someone couldn’t coerce you to give it up—but the power dynamic has shifted. You, and only you, control access to your coins. Bitcoin exists as an entry in a decentralized ledger secured by a global network. With basic precautions, you can ensure no one else can touch it.
There is literally no other asset on Earth with that level of total security.
And here’s the key: Bitcoin’s security scales with your choices. There is big optionality to your security.
You can choose to store it in a way that maximizes control and privacy, or opt for ease-of-use with third-party custodians. Using a hardware wallet like a Trezor or Ledger, you can carry your entire net worth across borders in your pocket—or keep it offline where nobody can access it but you. You can even go for multi-sig solutions that require other parties to be involved.
Yes, that security comes with responsibility.
Yes, with some options: if you lose your keys, you lose access.
But that’s part of the point.
Bitcoin doesn’t protect you from yourself—it protects you from everyone else.
Will the Use Cases EVER run out? (I'm getting tired Brian!)
Let’s keep going.
Bitcoin is easy to store. Hardware wallets like the Trezor let you carry your entire holdings with you—or keep them hidden away and inaccessible without physical access and private keys.
It’s easy to transport. You can travel anywhere in the world with the ability to access and move as much of your wealth as you want—instantly, permissionlessly. What other asset offers that?
It’s divisible. There are 100 million satoshis in a single bitcoin, so you can send fractions of a cent if needed. That makes Bitcoin practical for everything from microtransactions to massive transfers.
It settles relatively quickly. While not “instant” like credit cards appear to be (those take days to truly settle), Bitcoin is far faster than wires, especially international ones. And the transaction fee is typically small and not based on the amount sent—so whether you're sending $20 or $20 million, the fee might be the same.
In short, Bitcoin is already superior for large, secure, cross-border transfers. It’s fast, cheap, and hard to censor. And all without needing anyone’s approval.
Bitcoin is the perfect asset for storing liquid net worth.
This might be one of Bitcoin’s biggest long-term use cases.
You want your net worth to be liquid—accessible, flexible, and usable when needed. But holding fiat means accepting devaluation over time. Banks offer nothing for savings. And your “safe” money loses purchasing power every year.
Bitcoin flips that dynamic.
With its fixed supply and increasing adoption, it’s a savings technology that rewards long-term thinking. It can be exchanged quickly into fiat when needed—or used directly as a form of payment. It's mobile, secure, borderless, and—if stored properly—untouchable by anyone but you.
Bitcoin becomes the base layer for storing wealth, especially for the part of your net worth you want access to at a moment’s notice.
And when you compare it to offshore banking? Bitcoin offers many of the same benefits—asset protection, mobility, and discretion—but without needing a jurisdiction, a lawyer, or a bank. You don’t need a Swiss vault. You just need your keys.
There are a growing number of options to buy, sell, and store Bitcoin. It’s getting easier and easier—not just to own Bitcoin directly, but to get exposure to it through traditional investment tools.
For example, there are now multiple Bitcoin ETFs that offer direct exposure through traditional brokerage accounts. These make it easy for individuals, institutions, and even retirement funds to allocate capital to Bitcoin—without needing to manage wallets, custody, or private keys. While holding your own Bitcoin offers the greatest sovereignty, ETFs have opened the floodgates for capital that otherwise wouldn’t touch crypto.
This is part of what makes Bitcoin unique: You can choose your level of security.
Some people want absolute sovereignty. They’ll run their own node, use a hardware wallet, and hold their private keys. Others prefer to use custodians or platforms for convenience. That’s fine, too—as long as you understand the tradeoffs.
In this way, Bitcoin can be different things to different people:
A savings vehicle. A remittance tool. A sovereign asset.
A hedge. A speculative investment. A base layer for wealth storage.
Going Full Network
Take a step back, and you're forced to admit: Bitcoin has some incredible properties. Scarcity. Security. Portability. Programmability. Global access. Neutrality.
If the only thing holding it back is broader acceptance, then this is a classic network adoption problem.
The more people who use Bitcoin, the more valuable it becomes. And that’s exactly what we’ve seen. Despite volatility and media cycles, the long-term trend is adoption, growth, and resilience.
Yes, the world isn’t always logical or efficient in the short term. But I would bet that the emergent decisions we make economically in the aggregate will converge towards what logic, rationality, and what works.
And Bitcoin works.
It’s a monetary network. And the more value that flows into it, the more it behaves like other successful networks.
In the chart above, you can see how Bitcoin’s price has followed a pattern that resembles network adoption growth along a logarithmic curve. The green and red bands form loose upper and lower bounds, tracking the price as it expands over time.
The vertical blue lines mark Bitcoin’s halving events—the moments every four years when the block reward given to miners is cut in half. Historically, these halvings have created clear 4-year boom-bust cycles, because mining supply has been the dominant new source of Bitcoin entering the market.
Whether this cycle structure continues going forward is unclear, as mining rewards become a smaller part of the total available supply and other forces (e.g., institutional demand, ETF inflows, long-term holders) play a larger role.
From an investing standpoint, the best times to buy have historically been when Bitcoin’s price dipped near the lower green band on this curve. That’s where long-term upside is the greatest, and downside risk (assuming the network survives) is lowest.
As of August 2022, Bitcoin was in one of those accumulation zones—likely presenting one of the best entry points for long-term holders. And that dynamic continues today.
Of course, if Bitcoin fails as a network, it would likely show up by falling through the bottom of that curve and never recovering. But if it doesn’t—if adoption continues—then the reward is asymmetrically large and even greater towards the bottom of the curve.
Despite all the progress, we’re still early. While a meaningful number of people have owned or used Bitcoin, the vast majority of the world—and the vast majority of investable capital—remains on the sidelines.
As this chart shows, adoption is underway—but it's far from universal. Even in the countries where Bitcoin and crypto are most popular, only a fraction of the population has embraced them. The real growth still lies ahead. And as more users, institutions, and capital join the Bitcoin network, its value as a robust, decentralized monetary system becomes even more undeniable.
Bitcoin as a monetary network
Understanding Bitcoin as a network has significant implications.
Consider some of the most dominant companies of recent decades—Google, Facebook, Amazon. Each succeeded primarily because of network effects:
Google connects and organizes the world's information, becoming increasingly valuable as more users rely on its search and data services.
Facebook unites billions of users into a global social network, growing exponentially as new users join and deepen existing connections.
Amazon integrates commerce, logistics, and cloud services into a seamless marketplace, attracting more buyers and sellers, thus continuously enhancing its value.
Each of these networks experienced massive growth after surpassing a critical threshold (approximately $100 billion in value). Once established as market leaders, their network effects created self-reinforcing growth, multiplying their scale and value many times over.
Bitcoin is on a similar trajectory—but in the realm of monetary energy. It consolidates global demand for a decentralized, scarce, and censorship-resistant store of value. Like these corporate networks, Bitcoin benefits from Metcalfe’s Law: each new adopter exponentially increases its value, enhancing incentives for further adoption and strengthening its position as the world’s premier monetary network. And Bitcoin has also passed the critical threshold size.
Smart People's BTC Valuations
Now that hopefully you agree Bitcoin has value, the next question becomes:
How much value could it ultimately capture?
Investor John Pfeffer tackled this in his seminal paper on Cryptoassets valuation. Despite being somewhat old, it’s still one of the clearest frameworks for thinking about Bitcoin’s potential (as well as thinking about valuing ETH and L1s).
He proposed that if Bitcoin becomes the dominant monetary store-of-value cryptoasset, it could capture trillions in value from use cases such as:
Replacing gold bullion
Becoming an international reserve asset
Serving as a unit of account for global trade
Facilitating payments in countries with unstable currencies
Pfeffer’s estimate? A total valuation range of $4.7 trillion to $14.6 trillion, which implies a fully diluted Bitcoin price (21 million BTC) of $260,000 to $800,000 per coin. And when it comes to replacing gold, Pfeffer says, "we would estimate that the dominant store-of-value crypto could be worth ... USD $1.9 – $6.1 trillion." Given Gold is approximately 2.5x the value today it was in 2017, we can revise that up 2.5x to $4.75 - $15.25 trillion, and the total to $7.55 - $23.75 trillion.
That alone revises up his estimate of fully diluted BTC to $360,000 to $1,130,000 per coin.
Adding another layer: offshore banking
That already seems enormous. But there’s more.
One under appreciated use case: Bitcoin eating into offshore private banking—a market estimated at over $21 trillion USD. If Bitcoin captures just 10–50% of that market, you’re looking at an additional $2.1 to $10.5 trillion in potential value.
That expands the total addressable market to $9.5 – $35 trillion, and puts a fully diluted Bitcoin valuation in the $450,000 to $1.7 million range.
Where does the money come from?
People often ask: If Bitcoin is going to be worth trillions… where does all that money come from?
Simple:
From gold and silver
From countries with negative interest rates
From citizens under authoritarian regimes
From citizens living in countries with failing inflationary currencies
From anyone wanting to transfer value across borders quickly & cheaply
From billionaires and institutions hedging fiat debasement
From asset managers chasing performance
From people who need an escape hatch
From savers who have identified the future of SoVs
From AI agents who need to transact autonomously, globally, and without trusted intermediaries
Imagine a future where autonomous agents—AI systems, DAOs, or machine-based services—need to settle value with other systems in real time, across borders, without asking permission. They won’t wait for banks. They’ll use Bitcoin.
Imagine a wealthy individual in a predatory regime. They need a portable, permissionless way to protect and potentially escape with their wealth.
Bitcoin is perfect for that.
$10 million stored on a Trezor. Pocket-sized. Borderless. Instantly transferable.
That’s not science fiction. That’s already happening.
So, Bitcoin is a Swiss army knife of utility—a shape-shifting asset that could displace value across multiple key areas:
Gold (store of value)
International remittance
Global unit of account
Offshore banking
Treasury reserves for corporations and nations
It’s still unclear how much Bitcoin will absorb from each of these domains. But the potential is there. And if adoption continues to deepen across all of them, then the upper-end projections—over $1 million per BTC in 2021 dollars—don’t seem outrageous. They start to look... conservative.
Because Bitcoin isn’t just competing with gold or dollars or SWIFT or banks.
It's competing with all of them. At once.
It’s not trying to win one category—it’s slowly pulling gravitational value from many.
And when you add up those slices? The total addressable market becomes massive.
Total Addressable Market (TAM) Summary – Bitcoin (May 2025)
Use Case / Category | Est. Market Size | BTC Capture Potential | Implied BTC Valuation (21M supply) |
Gold (Store of Value) | ~$20T | 25–100% | $150k - $950k |
Offshore Private Banking | ~$21T | 10–50% | $100K – $500K+ |
Global Remittance Market | ~$800B annually | 10–20% | Modest price impact, strengthens utility layer |
Foreign Currency Reserves | ~$12T | 5–30% | $30k - $180k+ |
Treasury/Corporate Reserves | Trillions (cash/bonds) | 2–10% | $10K – $60K+ |
Cumulative TAM across overlapping sectors:
$30–50+ trillion, conservatively.
Implied BTC valuation range:
$400K to $2M+ per coin (long-term, fully diluted)
Who else is buying Bitcoin and where this might go
It’s no longer just tech nerds, libertarians, and early adopters. Institutions are here.
In 2020, MicroStrategy (NASDAQ: MSTR) shocked markets by converting over $400 million of its corporate treasury into Bitcoin. But they didn’t stop there.
As of May 2025, Strategy holds over 553,555 BTC (formerly Microstrategy), acquired at an average price of ~ $66,385 per coin. That’s almost 3% of the total Bitcoin supply, making them the largest corporate holder in the world. CEO Michael Saylor has turned MicroStrategy into a de facto Bitcoin operating company—leveraging its cash flows, equity, and even convertible debt to continue accumulating more BTC.
Michael Saylor, the CEO of Strategy, has a great 2-part interview series here where he explains his thinking and process of investing in Bitcoin. PART 1 // PART 2 He's also done a litany of other podcasts and interviews, and I highly encourage listening to him for extremely bullish Bitcoin ideas.
Saylor’s model—convert melting fiat into hard digital money—has become a blueprint for other corporations and sovereigns seeking to hedge inflation, currency risk, and long-term fiat debasement. His thesis: Bitcoin is not a speculative asset, but a superior monetary battery—a long-duration treasury reserve that outperforms cash and short-term bonds over time.
And this is just the beginning.
Since MicroStrategy’s first move:
Tesla bought $1.5 billion in BTC
Block (formerly Square) allocated $50 million
Fidelity, BlackRock, and other asset managers have launched spot ETFs
PayPal, Cash App, and Robinhood enabled millions of users to buy BTC
MassMutual, KPMG, and U.S. Bank now offer crypto-related services
The approval of spot Bitcoin ETFs in 2024 created a surge in demand. For the first time, Bitcoin is accessible in retirement accounts, brokerage platforms, and trust-managed portfolios—alongside equities and fixed income.
And now, nation-states are watching closely. El Salvador led the way, making Bitcoin legal tender and publicly disclosing sovereign holdings. Other countries—especially those facing sanctions, inflation, or frozen reserves—are exploring similar paths.
TAM: That was just the base case
The TAM we discussed earlier—$30 to $50 trillion—is already massive. But that’s actually the base case.
The bull case, as articulated by Saylor and others, is even larger:
Bitcoin doesn’t just go after gold, international remittance, or offshore banking. It also starts absorbing value from cash reserves, money markets, and sovereign debt.
In a world of negative real yields, mounting government debt, and structural inflation, Bitcoin becomes a logical alternative to holding bonds. If Bitcoin captures even a fraction of the global bond market (~$130 trillion), it could dwarf the original TAM.
In this view, Bitcoin becomes not just an asset — but the monetary foundation of the digital age.
We know this as HYPERBITCOINIZATION.
Bitcoin and Market Correlation
Previously, Bitcoin wasn’t very correlated with the stock market.
For years, it moved largely independently of equities—functioning more like an emerging technology or uncorrelated asset class. But that started to change around 2020–2022, and now in 2025, Bitcoin often trades in tandem with risk-on assets, especially during broad market selloffs.
Why the shift?
Because institutional capital arrived.
Bitcoin entered the portfolios of hedge funds, asset managers, family offices, and public companies. That brought credibility and liquidity—but also correlation. In a market crash, institutions sell what they can, not just what they want to. Bitcoin became part of that dynamic.
Right now, Bitcoin behaves like a risk asset with a unique upside profile. When liquidity dries up, it dips. When liquidity returns, it surges. But this correlation won’t last forever.
The long-term decoupling thesis
Eventually, Bitcoin will mature out of its risk asset phase—especially as it solidifies its role as:
A store of value
A collateral asset
A non-sovereign reserve currency
In that world, Bitcoin could behave more like digital gold than tech stocks. It may even become negatively correlated to equities in certain macro environments—especially during currency crises or debt deflation events.
So while Bitcoin currently plays a “risk-on” role in portfolios, it’s likely to evolve.
Today, it belongs in your portfolio as a high-risk, high-conviction bet. In the future, it may be viewed as a low-risk, antifragile reserve asset.
From Retail to Institutions to Sovereigns
So not only are private investors deciding to buy Bitcoin — Legitimate companies and public institutions are now in the game.
And as Bitcoin grows larger, it grows more stable. The volatility that once scared off corporate treasurers and pension funds is gradually declining. As liquidity deepens and the market matures, holding Bitcoin on the balance sheet becomes not just possible—but increasingly rational.
Today, Bitcoin is the 13th largest currency in the world by market cap—just behind the Brazilian real, ahead of the Russian ruble and Swiss franc. And it’s gaining ground. (Fiat market caps: here)
Now imagine this world, not too far in the future:
Bitcoin is 3–5x larger than today. It's legally accepted and regulated in most major economies. There are spot ETFs everywhere. Custodianship is easy, secure, and institutional-grade. Bitcoin has survived another halving and another wave of macro volatility.
In that world, Bitcoin will be seen not as an experiment, but as a reserve asset.
It’s already happened at the individual level. It's happening at the corporate level. Next comes the nation-state level.
El Salvador broke the ice. Others will follow. Because there’s a clear, logical incentive: Bitcoin is the only reserve asset not controlled by any one country or central bank.
Remember when over $300 billion in Russian reserves were frozen by Western allies? That shattered the illusion of “neutral” reserves for many countries. Suddenly, gold in vaults or treasuries in foreign banks didn’t feel quite as safe.
Bitcoin solves that.
It’s globally accessible, seizure-resistant, and can’t be debased by the monetary policy of any other nation. I believe countries holding Bitcoin as a reserve asset is inevitable because it is by far the best liquid asset for this role. It is a matter of when, not if. It's just logical.
From a game theory perspective, countries that start accumulating Bitcoin early gain an asymmetric advantage. The longer others wait, the more expensive that exposure becomes. It’s not a matter of if—it’s a matter of when.
And when that shift accelerates, the next wave of demand won’t come from retail investors or hedge funds. It'll come from central banks.
New customers will step up with obscene purchasing power, and the hardest, scarcest asset ever continues to rise. The farther Bitcoin goes, the more likely it is to keep rising.
Bitcoin: Momentum ---> Lindy Effect
The farther Bitcoin goes, the stronger it gets. The longer it survives, the more likely it is to keep surviving.
That’s the Lindy Effect in action: The life expectancy of a technology or idea increases the longer it has already lasted. Bitcoin’s track record now spans 16 years of nonstop uptime, growing security, and increasing adoption. Every major test it survives only reinforces its credibility.
Each wave of new holders strengthens the base. Each cycle of volatility builds resilience. And each major institution that joins the network makes it harder to ignore, harder to attack, and harder to stop.
Can anything slow down the train?
Back when I first wrote this article, I pointed to two major concerns:
Lack of legal clarity in the U.S., especially around ETFs
Mining centralization in China
Since then, both have been decisively resolved.
First, the U.S. finally approved spot Bitcoin ETFs in 2024. That single act opened the floodgates for massive new capital to flow in from retirement accounts, investment advisors, and institutional allocators. Bitcoin is no longer a fringe asset—it’s now listed next to stocks and bonds on major trading platforms. This will be discussed in more detail shortly.
Second, China banned Bitcoin mining in 2021, which at first looked catastrophic. The hashrate dropped. Prices plunged. People panicked.
But Bitcoin didn’t die. Instead, mining decentralized.
Within months, hashrate recovered as miners relocated around the world—particularly to the U.S., Canada, Latin America, and Scandinavia. What once looked like an existential threat turned out to be a stress test, and Bitcoin passed it with flying colors.
In fact, the mining ban strengthened Bitcoin’s decentralization. The network proved it could adapt to sudden shocks without a central organizer. That resilience is what makes it so unique.
The Energy Critique
Critics often claim Bitcoin’s energy usage is an existential flaw. This is shallow, level-one thinking—usually repeated by people who haven’t dug deeper or by detractors hoping no one will.
In reality, Bitcoin's energy consumption is a powerful net positive for global energy infrastructure.
It converts stranded, wasted, or unusable energy into money—anywhere. It makes previously uneconomical energy projects profitable. It gives energy producers a buyer of last resort.
As the 2020 Stone Ridge shareholder letter put it:
“Bitcoin mining is the only profitable use of energy in human history that does not need to be located near human settlement to operate. The long-term implications of this are world changing and hiding in plain sight.”
This opens the door to all kinds of breakthroughs:
Funding renewable energy expansion (solar, hydro, geothermal, wind) in previously unprofitable areas.
Serving as flexible demand in rural regions, turning on when energy is abundant, off during local demand spikes—enabling communities to build better power infrastructure affordably. (This is already happening in Africa and Latin America.)
And all of this overlooks an even more fundamental point:
Is securing the most incorruptible, globally accessible, non-sovereign monetary network humanity has ever created not a worthwhile use of energy?
The fiat system burns massive energy across militaries, banking infrastructure, global finance, and inflationary churn. Bitcoin makes all that optional. It doesn’t need towers, buildings, or banks—it runs on math and consensus.
Bitcoin’s energy usage isn’t a flaw. It’s integral to how Bitcoin fixes the incentives behind energy and money.
There’s no clear threat capable of stopping the Bitcoin network today.
It’s more decentralized than ever
It’s got global liquidity
It has legal recognition in most major economies
It’s deeply integrated with both TradFi and DeFi
Could a technical failure happen? Possibly. But those best qualified to assess that risk—engineers, cryptographers, and protocol researchers—see it as unlikely.
At this point, Bitcoin isn’t just surviving.
It's thriving.
ETF approval: BTC's elusive unicorn
To get an idea of how bullish this might be, take a look at gold when ETFs opened up in 2003:
For years, a U.S.-based Bitcoin ETF was seen as the holy grail—a financial instrument that would finally give traditional investors clean, regulated access to BTC through their brokerage accounts.
It was a long road. The SEC rejected application after application, citing concerns about manipulation, custody, and surveillance sharing agreements.
Meanwhile, countries like Canada and Brazil approved spot ETFs. U.S. investors were left to choose between inconvenient workarounds (like Grayscale’s GBTC) or direct BTC exposure via crypto-native platforms.
Then, in January 2024, it happened: The SEC approved ten spot Bitcoin ETFs from the biggest names in finance—BlackRock, Fidelity, Ark, VanEck, Bitwise, and others.
And the result? Spectacular.
Hundreds of millions in daily inflows
Bitcoin reached a new all-time high before the 2024 halving (a first)
Trading volume surged
Legacy investors who had never touched crypto suddenly had exposure
Yes, the launch of U.S. spot Bitcoin ETFs in January 2024 stands as the most successful ETF debut in history. Collectively, these ETFs amassed over $107 billion in assets under management (AUM) within their first year, surpassing all previous ETF launches by a significant margin. This was more than just ease-of-access.
ETF approval sent a powerful signal:
“Bitcoin has arrived. It’s here to stay.”
Now that these ETFs exist, the path is wide open.
Financial advisors can allocate to BTC alongside stocks and bonds
Pension funds and endowments can get exposure within compliance frameworks
Retirement accounts (IRAs, 401(k)s) can include Bitcoin
Portfolio managers can use it as a hedge or uncorrelated asset
Each year, the friction declines, and investor access improves.
From here, it’s only going to get easier and more normal for people to own Bitcoin—regardless of whether they know how to self-custody or even understand the underlying tech.
Cryptocurrencies: BTC & Altcoins
Now that the idea of a decentralized, digital monetary network exists, it’s not going away. Something is going to fill that role.
Bitcoin is by far the best option. I believe its the only option.
But why not something else?
There are other cryptocurrencies with different designs—Ethereum, Solana, Avalanche, Cardano, and many more. Some have promising features or serve different purposes. Many will be useful. Some may even have explosive returns.
But let’s be clear: different functions have different values.
A blockchain that runs decentralized applications (dApps) or supports smart contracts isn’t automatically competing with Bitcoin. These use cases can create demand for a token, but that doesn’t mean the token will accrue value the same way Bitcoin does.
Bitcoin’s value comes from being a pure monetary network— a decentralized, incorruptible store of value. It has no CEO, no foundation, no insiders who can change the rules. That’s not true for most other coins.
Why other coins won’t replace Bitcoin
Altcoins often launch with flashy tech, high throughput, and exciting narratives. But they usually:
Rely on centralized foundations
Have pre-mined allocations
Are governed by core teams or insiders
Trade off decentralization for speed
That’s fine for certain use cases—but it disqualifies them from being serious competitors to Bitcoin as a sovereign digital money. Institutions and nations aren’t going to park reserves in a chain that a small group of developers can upgrade at will.
Bitcoin had the immaculate conception:
No pre-mine
Founder disappeared
100% of supply earned via mining
Rules set at launch and defended by the community
That makes it irreplaceable.
Ethereum and the smart contract thesis
Of all the other cryptoassets, Ethereum has the clearest use case—as a base layer for smart contracts and decentralized applications. It has:
The largest developer ecosystem
The most real-world usage
A complete transition to Proof of Stake
Significant mindshare and tooling built around it
But Ethereum also faces real challenges.
It must scale transaction throughput dramatically to meet its goals, without sacrificing security or decentralization. It also exists in a far more competitive arena, with other smart contract chains like Solana, Avalanche, and Polkadot and about 100 other L1 chains vying for dominance and competing with Ethereum.
And from a monetary standpoint, Ethereum is far more mutable than Bitcoin. It has undergone significant technical changes, is governed more like a tech platform than a monetary protocol, and carries ongoing regulatory uncertainty.
That’s why, for the role of digital store of value and reserve asset, Ethereum doesn’t compete with Bitcoin. It’s a different race. A different purpose. And it carries much higher risk. And the market has born this out in the last few years up till May 2025 as ETH/BTC plummeted.
In a space where Bitcoin more fully realized is likely a 10x long-term return from the $100K range to a $1M base case, it’s tempting to chase altcoins for even higher multiples.
And yes—some of them will outperform Bitcoin over shorter timeframes. But picking those winners is incredibly hard, and the odds are stacked against you.
Even if a few projects succeed, most will not. And even the successful ones will likely suffer extreme volatility, regulatory risks, or be outcompeted by the next narrative.
That’s why, using a Sharpe-like lens (return divided by risk), Bitcoin still comes out on top. It has the best combination of:
High long-term upside
Deep liquidity
Global recognition
Institutional momentum
Proven security
Low existential risk relative to other crypto assets
Using basically Kelly Criterion / Sharpe Ratio analysis I believe that BTC is still the best investment. I go over this in more detail HERE in a twitter thread. If you can't write a short essay and explain to a friend who isn't an expert about why you feel you should hold X, Y, or Z coin vs Bitcoin - or sell them back for Bitcoin - then you should not bother in the first place. If you’re new to crypto, the best move isn’t to try and get rich quick by finding the “next Bitcoin.” That’s how beginners get wrecked. They chase hype coins, buy the top, panic during a crash, and end up holding worthless bags.
For the vast majority of people, the smartest strategy is simple:
Buy Bitcoin. Hold it. Don’t touch it. HODL = Hold On (for) Dear Life as Bitcoiners like to say
Learn the fundamentals. Ignore the noise. Avoid leverage. And let time do the work.
Once you truly understand Bitcoin, then maybe—maybe—you can consider allocating a small percentage to other projects you’ve researched deeply.
But until then?
Altcoins are just distractions. And you're not here to gamble. You're here to make the best investment decision.
And why won’t one of these coins take over Bitcoin’s role?
It’s a fair question. If crypto is an open market, why wouldn’t something better come along and displace Bitcoin?
Here’s why: Most of these newer coins are built for different use cases. They’re optimized for things like throughput, programmability, or niche applications—not monetary sovereignty. And in trying to do so many things, they compromise on the very properties that make Bitcoin what it is.
No coin has replicated:
Bitcoin’s complete decentralization
Its lack of pre-mine or insiders
Its track record of security at scale
Its immutable monetary policy
Or its neutrality on the geopolitical stage
Even more importantly, Bitcoin has a 16+ year Lindy track record and remains the only chain with global recognition as a credible long-term store of value. In a world where large corporations, sovereign wealth funds, and even central banks, are beginning to consider digital assets: nothing else qualifies.
No one managing billions or trillions of dollars is going to place reserves into a blockchain controlled by a foundation, a small dev team, or a group of stakers. They want something that can’t be changed—or rug-pulled—by anyone.
Bitcoin has what the crypto world calls the “immaculate conception”:
Founder disappeared
No pre-allocation
No early investors
No ICO
No central foundation
Just open-source code and fair mining from block 1
Now combine all that with being the first mover with the biggest name and the result is a launch structure that can’t be replicated.
Not now. Not ever.
Every other project has to deal with governance baggage—whether it’s token distributions, insider influence, upgradability, or regulatory exposure.
Bitcoin doesn’t.
That’s why Bitcoin’s moat is insurmountable. And unlike tech moats that erode, this one only grows stronger over time.
BTC as an Investment
When viewed purely as an investment, Bitcoin still has one of the best risk-adjusted return profiles in all of crypto—maybe in all of finance.
Why?
Because even if the upside isn’t 100x anymore, the likelihood of success is far higher now than it was when Bitcoin was $1K, $5K, or $10K. And in investing, expected value is about both: Payout × Probability
That’s where Bitcoin shines. It’s still a high-upside bet—but it’s no longer a long shot. It has the highest Sharpe Ratio of any asset in the crypto space when you factor in:
Institutional adoption
Regulatory clarity
Network effects
Proven resilience
Deep liquidity
Immaculate conception and decentralization
Some altcoins may have higher theoretical upside. But they come with drastically higher risk, complexity, competition, and execution dependency.
Some investors dismiss Bitcoin because they feel they “missed it.”
They look at the price—$50K, $70K, $100K—and assume the gains are gone. They want to find the next 100x. So they rotate into low-cap coins, meme tokens, or vaporware projects.
And more often than not? They get wrecked.
Bitcoin may not go 100x again. But it still has the potential to go 10x over the next 10 years & 30x+ in your lifetime. Again, if the extreme bull case plays out and say Bitcoin subsumes the bond market, Bitcoin could cross $5 Million per coin in 2025 dollars. And in inflationary - say 2050 - dollars, that would be a 100x.
That kind of asymmetric upside, combined with everything it has already proven, is why Bitcoin remains not only the smartest long-term bet in crypto, but it is why Bitcoin is the best, publicly available, asymmetrical, for any size, bet of our generation.
100% BTC Allocation?? GTFO
"Brian, 100% BTC is for noobs. I want big-time returns. I gotta get rich quick and Bitcoin is too big already." Listen, this is the case for going 100% Bitcoin as your crypto allocation —at least to start.
If you're new to crypto, you don’t need a diversified portfolio of coins. You don’t need to guess which smart contract chain will win. You don’t need exposure to meme tokens or “the next big thing.”
You need conviction, not clutter. You need simplicity, not speculation.
Start with Bitcoin. Understand it. Hold it. And don't touch anything else until you've earned the right to even consider it.
And above all, remember, you're investing - not gambling.
Because what happens to most beginners?
They chase the next Dogecoin. The next Solana. The next 1000x. They FOMO in late. They panic sell early.
Remember LUNA? It was a top-10 coin backed by major institutions and hyped as a new monetary model. Then it collapsed—$60 billion in market value vaporized in days. People lost life savings.
Meanwhile, experienced investors—the ones who’ve lived through multiple cycles—tend to move in the opposite direction.
They consolidate. They simplify. They cut noise.
And they end up increasing their Bitcoin exposure over time.
Beginning crypto investors think they missed the boat with BTC, get enamored with the potential of blockchain, and fall for the promises of altcoins. They try to buy the "next Bitcoin."
The phrase itself shows the foolishness of that perspective—there is no next Bitcoin.
Sure, over time, the market will mature. Some altcoin projects will win in their domains and deliver real utility. A few will be used regularly, and if you do the hard work early—dig into the tech, the team, the incentives—you might identify a winner and outperform Bitcoin.
That’s possible. But let’s be honest: it’s rare. And there are so many crypto coins.
It’s absolutely not something I’d ever recommend for a beginning crypto investor to even think about.
We’re talking about Bitcoin potentially becoming the most valuable asset on Earth. Not just flipping gold—but overtaking the U.S. dollar as the dominant sovereign reserve asset. That’s the scale of what’s in play here. And Bitcoin has zero competition within crypto for this.
By contrast, most altcoins have almost no moat, infinite competition, and are trying to carve out slivers of economic utility in crowded markets. Even the winners will be priced based on cash flows or usage—sharing their niche with copycats, forks, and challengers.
This isn’t a hard decision. One is aiming to become the base layer of global money. The others are battling it out like startups in a brutally competitive tech sector.
If crypto is your full-time job—or at least a serious part-time endeavor—then sure, maybe you explore speculative bets. Rotate in and out. Take shots when you see asymmetric opportunities.
But be honest about where you stand on that spectrum—and invest accordingly.
Ironically, the most conservative, boring strategy—just buying and holding Bitcoin—has historically produced the best long-term ROI. And that’s probably still true.
If you had to lock your crypto portfolio for 5 to 10 years or more, I think the right play today is simple: 100% BTC.
Already Deep in Crypto? Here’s the Litmus Test
And one last word for people who are already in crypto: If you’re already in the space—trading, holding altcoins, rotating in and out of positions—here’s the blunt truth: If your actions aren’t increasing your BTC holdings, you’re probably doing it wrong.
That’s the standard. That’s the scoreboard.
Whatever your strategy is—whether it’s trading, flipping NFTs, playing with defi yield farms, or rotating into altcoins during hype waves—it needs to be +EV in Bitcoin terms. Not in USD. In BTC.
Because if you’re active in crypto and your BTC balance is shrinking, then ask yourself: Why bother?
Just stop. Consolidate. Move everything to Bitcoin. Put it somewhere safe. HODL. And don’t touch it.
Bitcoin is the benchmark asset in this space. It's the king. It’s the base layer. It’s the reserve currency of crypto.
If you’re not outperforming it, don’t fight it. Just own it.
Every decision you make should be denominated in BTC.
And if it’s not improving your position in BTC terms—don’t do it.
This is a LONG TERM play
When considering Bitcoin as an investment, think long-term. You’re not just speculating on a price move—you’re betting that Bitcoin realizes the use cases and properties outlined throughout this piece.
If it does, then yes—higher valuations are likely. Let’s say Bitcoin is trading today around $90k, and you're looking at a near-term price targets of $250K in 4 years & 500k+ in 8+ years.
But really—once Bitcoin gets there, you should be cautious about selling to lock in gains outside of a portfolio rebalance. Because once momentum and the Lindy effect kick in, Bitcoin becomes even more likely to keep climbing toward full realization as a global monetary network.
From a Kelly Criterion perspective, the more likely a bet is to succeed, the more you should be willing to allocate to it. The EV matters, yes—but you should never allocate more than the probability of success.
So the fact that Bitcoin is much more likely to succeed—compared to earlier in its life—matters a lot. Even though the payout is lower than it was at $5K or $10K, the confidence is higher. And that means the bet may still be just as compelling, and you are definitely supposed to have a larger % allocation. Again, see this twitter thread I wrote.
Bitcoin’s Asymmetric Outcome Curve
When thinking about Bitcoin as an investment, don’t picture a normal bell curve.
The probability distribution here is inverted—a heavy skew toward the extremes. Bitcoin is unlikely to grind sideways for decades. It’s either going to fail, or it’s going to massively succeed. And the longer it survives, the more skewed the curve becomes toward the high end.
This is what makes it so compelling—and so misunderstood.
Yes, failure is a real possibility. And you need to accept that going in. But so is the possibility of Bitcoin reaching $1 million+ per coin if it continues on its adoption path.
Earlier I said, "There's no clear threat capable of stopping the Bitcoin network today." And while I stand by that, there are possible threats that could jeopardize it in the future.
The Two Big Existential Risks
1. Security Budget
As the block subsidy decreases with each halving, Bitcoin must eventually rely on transaction fees to secure the network. Critics argue that this will make it vulnerable to 51% attacks or reduce miner incentives.
Why it’s overblown:
Security is a spectrum, not binary. Bitcoin doesn't need infinite security—just enough to deter rational attackers.
Fee markets are already emerging, especially in congestion periods.
If/when BTC becomes a global settlement layer, users will pay more per transaction, and security funding will be sufficient.
There’s decades before this becomes a true issue. The next few halving cycles will clarify how well the fee market develops.
2. Quantum Computing
Could quantum advances break Bitcoin’s cryptography SHA-256 and allow attackers to steal coins?
Why it’s overblown:
No existing quantum computer is even close to breaking ECDSA.
Quantum-safe cryptography already exists and can be integrated if needed.
Bitcoin can upgrade via fork if the threat becomes credible—and would have global developer urgency if so. (this solution has risks inherent to it, but would very likely succeed)
More likely: quantum breaks everything else first—banking, internet infrastructure—long before it breaks BTC.
These are real risks, but neither is a near-term threat, and both are manageable if approached early.
EV Framing: Bitcoin as a High-Skew Bet
Let’s assume Bitcoin is currently trading at $100,000.
Here are some reasonable price targets if Bitcoin continues on its current adoption trajectory:
5 years → $300,000
10 years → $700,000
20 years → $1.5 million
Bitcoin is either going to massively succeed… or fail outright. But importantly, the failure risk increases slightly over longer timeframes—not because the thesis weakens, but because existential risks (security, quantum, geopolitical chaos, etc.) compound over time.
Estimated failure probabilities:
Time Horizon | Estimated Failure Risk |
5 years | 2–4% |
10 years | 5–8% |
20 years | 10–20% |
Simple EV calculations will show that BTC is still wildly +EV with these types of projections. Even if you used the lowest upside values & the highest failure risks from my range, BTC is very profitable. Even if you used significantly higher failure risks of say 50%, it still would be profitable.
Bottom Line
Bitcoin is a high-skew, long-volatility, asymmetric bet. The downside is capped (you lose your allocation). The upside is open-ended (you gain 5–25x+ over time).
Yes, failure is possible. But the probability-adjusted reward is more than enough to justify a significant long-term position—especially when compared to traditional assets facing inflation, dilution, and rising systemic fragility.
This isn’t about guessing the short-term chart. This is about owning a piece of the next monetary standard.
CONGRATS! You made it
So that's it. Hope you enjoyed this introduction. The rabbit hole goes much deeper. The goal here was to push you over the edge. Once you start falling, gravity does the rest.
Bitcoin: the self-fulfilling prophecy of the inevitable march towards emergent monetary soundness.
"And those who were seen dancing were thought insane by those who could not hear the music." ~Nietzsche
Other good Bitcoin resources:
Vijay Boyapati Bullish Case for Bitcoin - one of the best non technical value prop articles
Svetski Article 3 Generational Theory of Bitcoin - one of my favorites
Jeff Booth Bitcoin article - great account of Bitcoin value prop, long term value, promotes positive future growth
Blackrock 2020 shareholder letter - In particular read section 4 about Bitcoin re energy usage.
Arthur Hayes Blog on Bitmex - A series of extremely well written blog articles about various crypto topics written by the former CEO of Bitmex (formerly the leading crypto derivative exchange)
Lyn Alden Blog - Series of blog articles about wide variety of economic topics.
Cobie "CryptoCobain" Blog - Recently started blog articles about various crypto topics written by an English trader who formerly anon'd himself as Kurt Cobain
7 Misconceptions about Bitcoin - An article w/ similar goal to this: discuss with beginners + bullish arguments
Bitcoin in the Boardroom // Bitcoin Bull Bull Bull - 2part podcast w/ Michael Saylor
Light & Su Zhu on Art of Trading - Uncommon Core podcast w/ Hasu Bitcoin, Anarchy, Austrian Economics podcast w/ Saiffadean Ammous & Lex Friedman
Woobull charts by Willy Woo - interesting charts modeling different aspects of Bitcoin
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