Bitcoin is not "digital gold" - it is the global mother currency of the AI era.

Original Title: A Triple Interpretation of History, Engineering, and Finance: Why Bitcoin Will Not Decline?

Original author: @zzmjxy

Original source:

Reprint: Daisy, Mars Finance

When market sentiment cools, the narrative of “Bitcoin is dead” always resurfaces. The core assumption of this argument is that Bitcoin, as the first generation of blockchain technology, will eventually be replaced by its successors, just as has been the fate of all pioneering technologies in history.

This assumption seems logically flawless—but it is wrong.

1. The Curse of First-Generation Technology and the Exception of Bitcoin

The lessons from the history of technology are harsh.

Western Union - the communications giant that controlled 90% of the telegraph business in the United States in 1866. In 1876, Bell wanted to sell the telephone patent to it, but the higher-ups refused. Bell then founded Bell Telephone, which later evolved into AT&T - the largest company in the world in the 20th century. And what about Western Union, which rejected the phone? Today it has a market value of 2.7 billion dollars, ranking 3990th globally.

Intel - invented the first commercial microprocessor in 1971, dominating PC chips for thirty years. At the peak of the 2000 bubble, its market value reached $509 billion. Today, 25 years later, investors who bought at the high have still not recouped their investments, with a market value of $160 billion - less than one-third of its peak. It was not defeated by “faster CPUs,” but was left behind by generational architecture transitions (the rise of ARM and TSMC's leading processes).

Cisco - the king of internet infrastructure. In 2000, its market value exceeded 500 billion, surpassing Microsoft to become the world's number one. After the bubble burst, the stock price dropped by 88%, but since then, revenue quadrupled while the stock price has never returned to its peak. The value at the device layer was siphoned off by the protocol layer and application layer.

The pattern seems quite clear: the first generation of technology establishes proof of concept, while the second generation of technology harvests market returns.

However, 16 years after the birth of Bitcoin, the situation is completely different.

Today, the market value of Bitcoin is approximately 1.8 trillion USD, accounting for over 58% of the entire cryptocurrency market. The second place, Ethereum, is around 300 billion, less than one-sixth of Bitcoin. All “Ethereum killers” and “Bitcoin alternatives” combined still do not reach half of Bitcoin's market value. Sixteen years have passed, and Bitcoin has not only not been replaced by later entrants but has instead widened the gap.

The difference is: Telegram, chips, and routers are all tools, and their value lies in functional efficiency; when their functions are replaced, their value becomes zero. Bitcoin is not a tool, but a protocol layer—a permissionless global consensus system.

The value of the protocol layer lies not in the speed of functional iteration, but in the accumulation of network effects, immutability, and the Lindy effect. TCP/IP will not be replaced by “faster protocols” because the replacement cost far exceeds the efficiency gains.

The logic of Bitcoin is exactly the same.

2. The Misunderstood Positioning - From Payment Systems to Global Settlement Layer

The biggest narrative dilemma of Bitcoin is that it is judged as a “payment system”—and then deemed a failure.

Transactions are slow, fees are high, and throughput is low. These criticisms are all true. But they are criticizing something that Bitcoin has never tried to be.

Payment and settlement are two different things.

You swipe your card at Starbucks, completing the transaction in 2 seconds. But has the money really transferred? No. Visa just records a promise; the actual fund transfer has to wait for interbank clearing - which could be same-day or take a few days. Visa processes tens of thousands of transactions per second, but it's handling promises, not settlements.

Settlement addresses another issue: Is this money truly and irreversibly transferred from A to B? The final settlement between global banks still relies on SWIFT and various central banks—a system that requires days, permissions, and trusted intermediaries.

Bitcoin is not a competitor to Visa. It is a competitor to SWIFT—a permissionless global settlement layer.

This is not a theory. According to research data from Riot Platforms, the Bitcoin network settled over $19 trillion in transactions in 2024 - more than double that of 2023, with a single-day peak exceeding $30 billion. The Lightning Network, Ark, RGB - all these L2 protocols treat the Bitcoin main chain as the ultimate settlement anchor. This is exactly what a settlement layer should look like: the underlying layer does not pursue speed, but rather seeks irreversible finality.

From this perspective, the “drawbacks” of Bitcoin are precisely its design: a block time of 10 minutes, limited block size, and conservative scripting functions—these are deliberate choices to ensure that anyone can run a full node, verify the entire history, and not rely on any centralized entity.

Inspiration of TCP/IP

In the 1970s, the performance metrics of TCP/IP were quite “poor”—high latency, low bandwidth, and no native encryption. IBM's SNA and DEC's DECnet were technically “more advanced”. But TCP/IP won. Not because it was faster, but because it was simple enough, open enough, and difficult enough to control.

Fifty years later, no one attempted to replace TCP/IP with a “faster protocol.” It's not that there aren't faster solutions, but the replacement costs have become unbearable.

This is a profound inspiration at the protocol layer: once trust becomes the foundation, efficiency is no longer the primary metric, but rather irreplaceability is.

Proof of human collaborative ability

In November 2025, Bitcoin Core completed its first independent security audit since its inception 16 years ago, with the results being: zero critical vulnerabilities and zero medium vulnerabilities.

Behind this number is an even more astonishing fact: a protocol supporting nearly $2 trillion in market value has only 41 core developers worldwide, with annual funding of just $8.4 million. In comparison, Polkadot, which has a market value of less than 1% of Bitcoin, spends $87 million annually on development.

We may have underestimated humanity's ability to self-organize. Without companies, without foundations, without CEOs, a group of developers distributed around the globe maintains the largest decentralized financial infrastructure in human history with very few resources. This itself is a validation of a new form of organization.

The underlying architecture is also evolving. v3 trading, Package Relay, Ephemeral Anchors - these upgrades share the same goal: to enable L2 to anchor to the main chain more reliably. This is not a stacking of functions, but a structural enhancement.

The Grand Strategy of the Agreement: The Last Few Pieces of the Puzzle Before Petrochemicals

Adam Back – the inventor of Hashcash, a pioneer of the Bitcoin proof-of-work mechanism, and CEO of Blockstream – recently pointed out the direction of Bitcoin for the next decade: L1 should be conservative and minimal, ultimately becoming “petrified” – not in terms of not upgrading, but only making the last few most important upgrades.

Before this, several key primitives need to be completed: BitVM, Covenants, Simplicity. These terms mean little to most people, but their common goal is clear: to make Bitcoin a sufficiently powerful “anchoring layer” and then push all innovations to L2.

The roadmap is: minimal L1 → key primitives → innovation uplift → final solidification.

This is a strategic plan at the protocol level. It is remarkably similar to the evolution of TCP/IP: the core protocol remains stable while complex functions are implemented at higher layers.

Bitcoin looks weak on the payment side but is getting stronger on the structural side. This is design, not a flaw.

3. Value Capture at the Protocol Layer - The Mother Currency Status of Bitcoin

TCP/IP is one of the most successful protocols in human history, but it has a fatal flaw: there is no value capture mechanism.

The internet has created trillions of dollars in value, almost all of which has flowed to the application layer—Google, Amazon, Meta. TCP/IP itself is not worth anything. Vint Cerf and Bob Kahn changed human civilization, but the protocol itself did not capture any economic returns.

This is the classic dilemma of the protocol layer: the more fundamental and open it is, the harder it is to charge.

Bitcoin broke this dilemma.

Financial native protocol layer

Bitcoin has been native to finance since day one. The very function of value transfer is inherent in the protocol, with each transaction and settlement directly involving the flow of BTC. The success of the protocol is directly tied to the value of the token.

There is no “TCP coin” in TCP/IP. There is no “HTTP coin” in HTTP. But Bitcoin has BTC.

When Bitcoin becomes the global settlement layer, BTC automatically becomes the unit of account for this settlement layer—in financial terms, it is called the numeraire.

Observe the actual behavior of the market: the main trading pairs on the exchange are priced in BTC; when institutions allocate crypto assets, BTC is the benchmark, and others are “risk exposure relative to BTC”; the risk parameters of stablecoins, DeFi, and AI computation networks are ultimately tied to BTC. This is not faith, but market structure.

One layer more than gold, one layer more than TCP/IP.

“Digital gold” is only half the truth.

Gold is a store of value, but not a protocol layer. You cannot build applications or run L2 networks on top of gold. The value of gold comes from its scarcity, but it does not generate network effects.

Bitcoin is both a store of value and a protocol layer. The Lightning Network, RGB protocol, and various L2s are built on top of it, and their existence, in turn, reinforces Bitcoin's network effect. This is a compound growth logic that gold does not possess.

Conversely, TCP/IP is a protocol layer, but does not capture value. Bitcoin is both a protocol layer and can capture value.

So the ultimate positioning of Bitcoin is: the network effects of TCP/IP technology + the value storage properties of gold + the inherent value capture ability of finance.

The three are superimposed, not substituted.

IV. Increment in the Age of AI - Why the Background has Changed

The above three layers of logic are all based on the extrapolation of the “stock” world. But the real variable is: we are entering a completely different era.

The Internet connects people and data. AI connects algorithms, computing power, and autonomous agents.

This is not a change in degree, but a change in nature.

In the internet era, the main subject of value flow is humanity—humans create content, humans consume services, and humans make decisions. The financial system is designed for humans, with KYC, business hours, national borders, and manual approvals—these frictions are bearable for humans.

In the AI era, the main entities of value flow will include a large number of non-human agents. Here is a key structural constraint: AI agents cannot use the existing financial system.

It's not “inconvenient”, it's “impossible”:

AI agents cannot open bank accounts - no ID, unable to pass KYC.

AI agents cannot wait for T+2 settlement - their decision-making cycle is in milliseconds.

The AI agent does not understand “working days”—it operates 24/7.

AI agents cannot tolerate manual approval - any human process is a bottleneck.

Every feature of the existing financial system is not a friction but a fundamental barrier to the AI economy.

Algorithmic economy requires algorithmic currency

When AI agents begin to trade autonomously—buying computing power, paying for API calls, exchanging data, settling services—they need a “mother coin”. A benchmark that all agents can recognize, trust, and use for valuation.

The US dollar is not suitable for this role because it relies on human institutional intermediaries. Ethereum is not suitable for this role because its monetary policy can be altered through governance, and it has a clear leadership—Vitalik and the Ethereum Foundation can influence the direction of the protocol.

And BTC - a fixed cap of 21 million, a predictable issuance curve, rules that cannot be modified by any entity, no founders, no foundation, no CEO - just happens to possess all the characteristics required of the “mother coin of the algorithm era.” Back to the earlier audited set of data: 41 developers, 8.4 million dollars in annual funding, zero high-risk vulnerabilities. This is not only a miracle of capital efficiency but also an ultimate proof of absolute decentralization and self-organized collaboration.

The era of AI does not make humans need Bitcoin more, but rather makes non-human intelligence need a global settlement layer for the first time.

This is why the economic volume in the AI era may far exceed that of the human internet era. The users of the internet are 8 billion humans. Participants in the AI economy could be billions of autonomous agents, conducting millions of microtransactions per second.

Bitcoin is not competing for shares in a saturated world. It is laying the groundwork for a yet-to-be-fully-unfolded incremental world, establishing a settlement layer in advance.

Conclusion: Terminal Valuation and the Return of Capital

Reviewing the logical chain of the entire text: Bitcoin is not a first-generation blockchain technology, but a protocol layer; it is becoming a truly reliable global settlement layer through architectural upgrades; as a natively financial protocol, it inherently possesses value capture capabilities, and is becoming the mother coin of the crypto world; the arrival of the AI era will provide this mother coin with application scenarios far beyond those of the Internet era.

If this logic holds, the valuation anchor of Bitcoin is not just “digital gold”.

The total market value of gold is approximately 18 trillion USD. The total value of the global internet economy is measured in trillions of USD. The economic scale of the AI era will far exceed the sum of the two.

Bitcoin is the intersection of several layers of value. If it is merely “digital gold,” benchmarked at 18 trillion, each BTC would be about $850,000. If it simultaneously carries the network effects of the protocol layer and the settlement demands of the AI era, this number is just the starting point.

Understanding this endgame logic allows one to comprehend the current market behavior.

The temporary departure of capital is not “abandonment”. If the long-term target for BTC is $1 million per coin, would smart money choose to buy starting from $120,000, or wait for a pullback to $80,000 or $50,000 to enter?

Every panic sell-off is a transfer of chips from the weak hands to the strong hands. Every narrative of “Bitcoin is dead” is the market re-pricing itself at a lower position.

The mission of Bitcoin is not completed, but just beginning.