The Bitcoin orthodox faction is being targeted by the "reformers," as the trillion-dollar market opens to institutions.

Written by: Michael Saylor

Translated by: AididiaoJP, Foresight News

Bitcoin is currently at a decisive historical turning point. It is no longer merely a technological experiment of the cypherpunk community but has evolved into a global capital network involving individuals, hedge funds, publicly traded companies, banks, custodians, and even sovereign governments.

However, an internal schism surrounding Bitcoin's "orthodoxy" is intensifying. Represented by Michael Saylor, the "reformists" have recently made a strong call: the "fundamentalist" dogmas surrounding Satoshi Nakamoto, the whitepaper, and self-custody must be broken. Bitcoin must evolve from the narrow definitions of "electronic cash" and "digital gold" to encompass equities, credit, derivatives, and the machine economy as "digital capital."

When Survival Rules Become Dogma: The Schism of Bitcoin Culture

In the early days of Bitcoin, facing regulatory crackdowns, exchange failures, and hacking attacks, the mantra "don't trust, verify" was the bottom line for survival. However, Michael Saylor points out that these once-rational defensive strategies have now solidified into "orthodox dogma" that hinders Bitcoin's pathway to mainstream acceptance.

The core tenets of this "orthodox theory" include: Satoshi Nakamoto is an eternal oracle; the whitepaper is a constitution that must be obeyed; Bitcoin must become a currency for everyday payments; self-custody is the only authentic form of ownership; governments and banks must be eliminated; any claims of securitization or custodianship equate to "paper Bitcoin."

Saylor states bluntly: "When yesterday's defensive posture is treated as tomorrow's complete structure, the movement becomes fragile." He emphasizes that the choice is not between Bitcoin and institutions but rather between exit-capable institutions and non-exit-capable institutions, between transparent claims and deceptive claims. Self-custody is a vital right, but it is by no means a universal obligation.

The "Original Sin" of Electronic Cash and the Rise of Digital Capital

Although the whitepaper clearly defines Bitcoin as a "peer-to-peer electronic cash system," Saylor believes the market has revealed deeper utilities. In the United States, the tax system treats Bitcoin as property, the CFTC classifies it as a commodity, while wages and businesses are still priced in fiat currency.

This is not a failure of Bitcoin, but rather a sign of its maturity.

Just as gold is no longer used to buy coffee yet still holds significant economic meaning, the Fedwire settlement system, which is invisible to retail users, is crucial. Bitcoin's greatest value may not lie in replacing dollars for coffee but in becoming a digital reserve asset that transcends sovereignty, possesses scarcity, is globally liquid, and can be programmed.

Saylor proposes a more ambitious framework: Bitcoin will become the underlying reserve asset for new forms of equity, credit, debt, and derivatives. It is not about destroying fiat currency and banks, but rather about coexisting with them and reshaping their infrastructure.

Breaking the Ritual of "Self-Custody": Security Needs Specialization

In response to the Bitcoin community's ironclad rule of "not your keys, not your coins," Saylor expresses strong affirmation but refuses to elevate it to a "universal obligation."

He points out that self-custody may pose significant operational and physical risks for ordinary elderly individuals, families, or publicly traded companies (such as kidnapping, hacking, or inheritance issues). The Coldcard hardware wallet vulnerability incident in 2026 revealed that "ideological purity" does not guarantee security—this incident was caused by entropy source defects leading to the generation of weak private keys, with reported losses exceeding $100 million.

Saylor believes that security is a systems engineering issue, not a brand or dogma. Professional custody, multi-signatures, and institutional services are not the enemies of Bitcoin but rather manifestations of economic specialization. "We trust companies to build airplanes and power plants; key management is not exempt from this principle."

Opposing the "Paper Bitcoin" Panic: Financialization is the Natural Home for Capital

The orthodox faction frequently denounces all Bitcoin-based securities (ETPs, corporate stocks, convertible bonds, derivatives) as "paper Bitcoin" fakes. Saylor vehemently counters this viewpoint.

He cites BlackRock and Strategy (formerly MicroStrategy) as examples—by August 2026, these two institutions alone held and represented nearly 1.6 million Bitcoin. It is the existence of these institutions that has brought liquidity, research coverage, political protection, and massive capital inflow.

"ETP shares are not self-custodied coins, but that does not mean they are fraudulent," Saylor points out. Pension funds need registered securities, banks need qualified collateral, and investors need derivatives to hedge risks. "Financialization is not the corruption of capital; it is a way for capital to serve diverse needs. The answer to bad paper is good disclosure, not the abolition of finance."

BIP-110 Rejected: The Market Rejects Ideological Compulsion

The article references a recent landmark event in Bitcoin governance—the failure of the BIP-110 proposal. This proposal sought to impose hard constraints on data embedding to "restore Bitcoin's monetary intent."

As a result, the proposal was comprehensively rejected by the economic network, leading to chain forks and mining stagnation, ultimately being marked "closed" on August 9, 2026. Saylor believes this proves that belief is not consensus. "Developers can write code, but no one can force miners to provide computational power, exchanges to recognize code, or the market to call its chain Bitcoin."

This event marked the market's rejection of the orthodox faction's attempts to impose ideological compulsion through coding.

Fiat Currency and Bitcoin Can Coexist

Saylor particularly emphasizes the essential political and ethical differences between the "reformists" and the "orthodox." The orthodox promises the disappearance of governments, banks, and companies, which naturally arouses hostility from these power institutions towards Bitcoin. In contrast, reformists see Bitcoin as a capital asset that can enhance governments, banks, companies, and families.

"Bitcoin is at its strongest when it does not require converts to give up modern civilization before they are allowed to benefit from it." Fiat currency will continue to serve taxation, wages, and businesses, while Bitcoin will run parallel to and beside it, as a scarce, portable, non-sovereign store of capital.

The ultimate goal: the trillion-dollar frontier of digital capital.

Saylor predicts that the next phase of Bitcoin's market size will far exceed the realm of payment applications, targeting the digital transformation of global capital.

SIFMA data shows that the global equity market is valued at approximately $157.8 trillion, and fixed income securities at about $160.7 trillion. Bitcoin does not need to replace all assets; it only needs to provide alternatives where scarcity and portability are needed.

The future layered structure will include:

• Digital capital (Bitcoin as reserves)
• Digital equity and credit (securities and debt issued around Bitcoin)
• Digital derivatives (risk transfer instruments)
• Machine capital (Bitcoin payments autonomously controlled by AI and the Internet of Things)

Conclusion: Bitcoin Has Grown Up

Saylor concludes: "The founding culture of Bitcoin was forged in opposition. It resists inflation, centralized control, and institutional failure. Yet the global capital network cannot be built solely from negation."

"Governments will not disappear, banks will not disappear, securities, credit, and derivatives will not disappear. They will compete, adapt, and increasingly integrate with Bitcoin. That integration will not make Bitcoin scarcer or less sovereign; it will make those attributes available to more people in more forms."

"Bitcoin started as peer-to-peer electronic cash, matured into digital gold, and is now becoming digital capital—the foundation for a new generation of credit, equity, and economic organization. The network has not abandoned its principles; it is transcending its biases. Bitcoin is for everyone."