Bitcoin is often discussed through price, narratives, or short-term catalysts. Those are mostly noise. A more durable way to think about Bitcoin is through mental models that answer a few foundational asset allocation questions:

Why Bitcoin at all?
Why not zero?
And if not zero, how much?

This piece is an attempt to lay out those models from first principles.

> Money as a Ledger

At its core, money is a ledger. It is a way of keeping score - of tracking who owns what share of global economic output.

Once you accept that framing, the relevant question becomes: what properties should such a ledger have?

At a minimum, we should demand that it is difficult to corrupt, difficult to manipulate, hard to produce, easy to verify, and secure against unilateral control. Historically, societies have experimented with many forms of money - shells, metals, paper claims, fiat currencies - each with trade-offs along these dimensions.

Bitcoin is best understood as an attempt to optimize for one property above all others: an incorruptible ledger.

Its security comes from a combination of enormous cumulative hash power, a deliberately constrained rule set, and a cost structure that ties the creation of new units to real-world energy expenditure.

Add to this a strictly finite supply of 21 million coins and strong monetary properties such as portability, durability, divisibility, and fungibility, and it becomes reasonable to argue that Bitcoin is the hardest form of money the world has ever seen.

> “But Anyone Can Create a Scarce Coin”

A common objection is that scarcity alone is meaningless because anyone can create a cryptocurrency with a fixed supply.

This objection misunderstands where scarcity comes from.

Scarcity is not a parameter you declare in code. It is a social and economic achievement. Bitcoin’s scarcity is enforced by a global network of independent miners and nodes, enormous sunk infrastructure costs, and an inability to change the rules without near-unanimous consensus.

Most alternative attempts fail on several fronts. They lack comparable security budgets. They lack deep, organic network effects. And they often suffer from compromised origins - premines, insiders, foundations, or identifiable control points.

Bitcoin’s early history matters here. A pseudonymous founder, no premine, no marketing phase, and a long period where the asset had little or no market value created a distribution and governance structure that is exceptionally difficult to replicate after the fact. One might even call it an immaculate conception.

Anyone can copy the code. Very few can copy the circumstances.

> “But It Has No Intrinsic Value”

Another frequent claim is that Bitcoin has no intrinsic value.

Strictly speaking, neither does anything else.

Value is not an inherent property of objects; it is contextual and subjective. What is sand in one context is silicon in another. A digital Netflix subscription, enterprise SaaS software, or a domain name has no physical substance, yet clearly has value because people are willing to pay for it.

A useful historical precedent is fiat money itself: paper claims with no intrinsic value, yet enormous real-world purchasing power. Earlier systems such as tally sticks were also purely accounting mechanisms - ledgers, not commodities.

Gold provides a useful comparison as well. Gold derives some value from industrial and ornamental use, but the overwhelming majority of its price reflects a monetary premium - its role as a store of value over thousands of years.

If gold lost its monetary role, it would almost certainly trade at a fraction of its current price.

Bitcoin can be thought of as an attempt to extract the monetary properties of gold while shedding its physical disadvantages: the cost of storage, transport, security, and verification. In that sense, Bitcoin’s value proposition is deliberately narrow.

Its value is almost entirely monetary - and that is a feature, not a flaw.

> “But It Doesn’t Scale or Support Payments and Smart Contracts”

Bitcoin is often criticized for what it does not do: high transaction throughput, complex smart contracts, or application-level flexibility.

This criticism confuses purpose.

Bitcoin’s role is not to be a general-purpose computation platform. Its role is to serve as a base monetary ledger with a minimal attack surface. Security, decentralization, and rule stability matter more at this layer than speed or expressiveness.

Well-designed systems solve different problems at different layers. A slow, extremely secure base layer can coexist with faster, more flexible layers built on top, each with their own trade-offs. Bitcoin’s deliberate constraints are what allow it to remain globally verifiable and resistant to capture.

Money needs to be simple if it is to be universal.

> Volatility, Adoption, and Emergence

There are valid objections to Bitcoin.

As money, it is still lacking in two important properties: stability of value and near-universal acceptability. These are not trivial shortcomings.

But as a thought experiment, it is worth asking what an organically emerging form of money - one not imposed by states or backed by taxation - would look like in its early decades. Volatility, disorder, and sharp regime shifts are exactly what one would expect as a new monetary asset competes for relevance, liquidity, and trust.

Emergent systems are noisy by nature. Their early behavior does not resemble their eventual steady state.

In that sense, Bitcoin’s history is not inconsistent with its ambitions.

> Allocation and Humility

Bitcoin is not guaranteed to become global money. It may plateau as a niche asset.

But given what it has already survived - technological skepticism, repeated regulatory pressure, hostile state actions, and multiple boom-bust cycles - it is difficult to argue that its correct allocation in a diversified portfolio is zero.

What that allocation should be depends on the individual or institution, their risk tolerance, and their broader portfolio context. As time passes, Bitcoin increasingly exhibits Lindy-like behavior: the longer it survives, the more likely it is to continue surviving.

This is also why extreme positions tend to be wrong. Gold versus Bitcoin is a false dichotomy. The intellectually honest answer to most allocation questions between the two is not “either/or,” but “both.”

Anything else assumes more certainty about the future than history justifies.

> About Tatv

Tatv is a collection of essays on markets, systems, and execution in the age of crypto and AI. The focus is on structure over narrative, process over prediction, and building tools that operate within markets rather than merely commenting on them.

If this piece resonated, you can follow our work:

- Tatv essays and frameworks: https://tatv.ai

- Airavat — execution and trading systems: https://airavat.xyz

- Founder on X: https://x.com/gautam_airavat