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Bitcoin: From the Void

How Bitcoin Uses Both Nothing and Chaos to Create Something the Likes of Which We Have Never Seen Before.

Tomer Strolight
Tomer Strolight
Sep 13, 2022September 13, 202215 min read15 minutes read
Audio narration
Swan Private Insight Update #14

Swan Private Insight Update #14

This report was originally sent to Swan Private clients on August 12th, 2022. Swan Private guides corporations and high net worth individuals globally toward building generational wealth with Bitcoin.

Existence and Creation

How does existence come to be?

The ancient Greek creation myth states that at first there was chaos — nothingness — a void. Then, somehow, order arose.

The Judeo-Christian religions say the Genesis happened at a time that the Earth was formless, void and dark, until God said “Let there be light!”

Modern science doesn’t try to explain how everything actually came into existence. It traces the history of the universe back to an event it calls the Big Bang — a time when everything in the universe already existed, but was packed together into a very hot and dense state. Then, suddenly, and still inexplicably to us, it went through a rapid and brief state change called inflation which led to the organized and lawful order of things we now observe.

Meanwhile, we arrive at expressions like “You can’t get something from nothing” or “there ain’t no such thing as a free lunch.” And the laws of thermodynamics support such conclusions. There’s the first law of the conservation of matter and energy which says that it is neither created nor destroyed, just rearranged. And furthermore, the second law states that on the whole everything trends to entropy — towards chaos and disorder. The modern view is that the only way we can create anything is by re-arranging already existing things.

Bitcoin: Making Use of Nothing

When we look closely at Bitcoin, a peculiar pattern in its design and operation emerges. Perhaps rather, this observation comes when we don’t look too closely at the actual implementation details themselves, but rather, at what they lack — at what is not there. What we observe is that Bitcoin itself repeatedly creates something unprecedented — something valuable and unique — out of emptiness, absence, or a void. Let’s explore some examples.

Where Should We Begin? How About Nowhere

We can begin anywhere really, so let’s begin at that place called nowhere, which is actually not someplace, but no place.

You’re somewhere. You occupy space. So do I. Whatever country you’re in is also somewhere. It occupies space. If something bad happened to the space you or your country occupied, you and your country would cease to be.

But where is Bitcoin? Can we eliminate the location it is in, thereby eliminating Bitcoin? We all saw, for example, in October 2021 that Facebook and all its subsidiaries went down for many hours because something had gone wrong with their data centers — the locations they were in. We’ve seen something similar happen to every other major internet service, and for the same reasons. The destruction of the handful of data centers any web service is located in would spell the end of it. But not Bitcoin.

If you yourself run a Bitcoin node, is Bitcoin in the node? Well, yes, it’s in there in one sense. But if that node ceased to exist, Bitcoin would not stop existing. So Bitcoin is not in there in any sense that Bitcoin would disappear if the node ceased to be.

Bitcoin itself has no concept of location built into it. There’s no field in its database for address, city, state, or country. No Bitcoin node knows or cares where it is. The same data exists identically in every Bitcoin node. They’re each perfect replicas, staying in touch with each other to sync up, wherever they are. None has any primacy over any other. They’re all equals.

Wherever these nodes are, Bitcoin is in each one, but Bitcoin, the network, is not in any one of them. Bitcoin, the network is what emerges from all those nodes running together, and it is not dependent on any one of them or even on any large number of them operating to survive. It is not actually in any particular place on Earth.

“So what?” you might ask. Well, here’s the rub. By not being anywhere, Bitcoin can’t be stopped by “taking out” its location. Here’s the first hint at this design pattern: by being nowhere, Bitcoin manages to do something that can’t be done by anything that is somewhere. That is, it manages to eliminate its dependence on location to exist. It exists nowhere in particular, and because of this, it can survive the destruction of any place in particular. Internet outages in Canada? No problem. Electricity down in California? No worries. An outright ban in China? No big deal. A lightning strike on a data center? Who cares? All of these are just temporary unavailability for some people in some places, because something else other than Bitcoin is unavailable in that place. But Bitcoin itself does not exist anywhere in particular. It keeps ticking along no matter what happens in any particular place — because it’s not there, or anywhere else for that matter.

Everybody from Nobody

One of the most valuable things about Bitcoin is that anybody can use it. This is because nobody can be prevented from using it. What’s the magical engineering secret that Satoshi used to prevent anybody from ever preventing anybody from ever using Bitcoin? It’s not what he put in — it’s what he left out.

Bitcoin has no concept of users. No field for first name, last name, middle name, profession, nationality, gender, credit score, criminal record, date-of-birth, email address, phone number. None of that. Bitcoin doesn’t know or care that people exist or that some of them might try to stop others from using it.

Instead, to use Bitcoin — to receive, hold, or send its currency — you need only have a large random number, which can be used as the private key from which you can derive public keys and addresses. This number is not linked to your actual identity, and you can create as many addresses as you’d like.

There’s nowhere to look inside Bitcoin’s codebase and say:

See, this is where it says everybody can use it. These are the lines of code that prevent anyone from preventing anyone else using it.

Instead, it’s what isn’t there. Through the absence of code identifying anyone, Bitcoin eliminates the need for anyone to identify themselves to use it.

To Use Bitcoin, Start With Chaos

But what is the action someone must take to use Bitcoin properly? What are the precise, orderly steps?

First, you too must reach into the void of chaos if you want to use Bitcoin. There is no private key with your name on it. There is just a vast range of huge numbers that can serve as private keys and you must pick at least one of them to get started.

But you must be careful. If you choose a number someone else can guess, they will be able to spend your coins as if they were their own. There’s only one reliable method to generate a number nobody else can guess or figure out. That way is to rely on chaos — also known as entropy, indeterminism and disorder — so that nobody can backtrack your steps to recreate that number.


For you to enter the community of Bitcoin users, you too must first enter the void yourself — the huge space of never-before-written down numbers — and bring something back from there (and keep it secret). There’s no other way. Sure, you can have other people use Bitcoin on your behalf. But you’re not using Bitcoin then — they are. And you’d better hope they reached into the void with maximum chaos to get their number, or someone will steal the coins they are supposed to be holding for you.

What other product or service has as the first step of its instructions: “Step 1: Generate entropy”?

But when you create a wallet, that’s exactly what you’re doing. You’re first bouncing from random data point to random data point with such chaos that nobody will ever be able to retrace your steps, then writing down the number you’ve arrived at, and finally bringing it back to the orderly and sensible world we all inhabit.

Trust No One

Joseph Stalin famously said, “I trust no one, not even myself.” He was a monster, but he had a point. After all, how can you trust anyone besides the people you’ve come to know really closely? People can lie, break their promises, or cheat on you. There are so many ways to breach trust.

Satoshi Nakamoto also famously said “The root problem with conventional currencies is all the trust that’s required to make it work.” We have to trust the regulatory bodies, their employees, the politicians who can exert pressure on them, the banks and their employees, the people and companies who print money, and countless others who can alter records, debase the money, counterfeit it, and more.

In Bitcoin, Satoshi figured out how to use Proof of Work, digital signatures, and peer to peer networking to eliminate the need for trust in the accounting records of the entire monetary system. He removed every single point of trust in people at every single step of every single operation of the system. Bitcoin is the most untrusting information system ever devised to track money. It’s completely without trust — “trustless.”

So what’s the result of this ruthless, uncompromising, relentless trustlessness? For the first time in history, we have something we can actually fully trust! By eliminating every point of trust, Satoshi eliminated every point where trusting in others could be broken or betrayed, and the outcome is that at the system level of Bitcoin, trust cannot be violated. Because of this, you can actually trust it.

If your node reports that you received some bitcoin and that the transaction has been confirmed on the blockchain, you can trust in the fact that you don’t need to trust anyone — not even yourself. This is a fact that cannot be altered by anyone, and yet, it can be verified by anyone. Stalin would have been quite impressed.

The most trust-worthy system the world has ever known was created not by finding the most trustworthy people and asking them to lend their credibility to it, but rather, by being so untrusting in each step of building it that there were no dependencies on trust left in it. A trustless approach to design created unimpeachable trust.

This of course makes Bitcoin an incredibly useful creation because now, with Bitcoin, absolutely anyone can exchange value with anyone else, no matter what that other person’s trustworthiness is. They can do so while being able to trust in the fact that the money paid is not going to be taken back and is itself not counterfeited. Think about that for a moment — the biggest liar in the world can come to you and offer to pay you in bitcoin, and if you receive a payment from him, even though he’s dishonest to the core, you can trust him in this regard. It provides safety for you from his lies and, to some degree, some redemption for that liar since he can operate in a realm where even those who know him to be a liar can trust him.

Poor Bitcoin Has No Money or Property

The bitcoins on the Bitcoin network are very valuable, but they don’t belong to Bitcoin. They belong to you and me and anyone else in the world who has the keys to spend them.

Like any organization, Bitcoin needs resources to keep functioning. Every company, government, and not-for-profit entity needs money to pay its suppliers. Inevitably, they must negotiate with these suppliers, pay them, deal with the discrepancies and disputes that eventually arise, and protect their property from theft and seizure. This is known as “overhead” or “the cost of doing business.”

What does it cost Bitcoin to do its business? Well, once again, nothing. It has no money to pay anyone and it has no assets to employ. Bitcoin’s critics look at this and say “Bitcoin is worthless!”, “It’s nothing at all!”, or “It has no intrinsic value!”, to recite just a few of the typical tropes.

But Bitcoin has a (non-existent) ace up its (non-existent) sleeve. It doesn’t need any property or money for itself. It asks for nothing for itself. It does not negotiate. It does not listen to those who allege to have a dispute with it. It experiences no cost of doing business. It says to everyone in the world “You can spend whatever you wish on operating Bitcoin. It’s entirely up to each of you. I, Bitcoin, will keep nothing.” (It of course doesn’t literally “say” any of that because it has no ability to speak either.)

Bitcoin never accepts any cost of doing business and cannot pay for any such cost. It is completely impoverished. And you know what can thus never happen to it?

Bitcoin can never go bankrupt.

After all, it never enters into any obligation to pay anyone anything. Bitcoin’s “balance sheet” is zero assets = zero liabilities plus zero equity. Ask any accountant the definition of bankruptcy and they’ll tell you it means being unable to pay one’s debts. Bitcoin has no debts and can never have any. But show Bitcoin’s balance sheet to any accountant, and they would be baffled if you told them it belonged to an organization serving millions of people, and operating non-stop, 24/7/365 for over a decade, and flawlessly accounting for and transacting hundreds of billions of dollars of value transfer.

Finally, and also curiously, this thing that has no property for itself produces the most pristine property that has ever existed — but not for itself. Try telling that to the imaginary accountant we’re talking about: “This organization, with no assets or equity, somehow operates flawlessly and non-stop, and as a result of its operation, it creates property the likes of which has never existed before. It creates property that is so sought after that billions of dollars are spent daily in trading it, and which countless knockoffs of are being created every day. In fact, billions of dollars are raised by venture capitalists to create imitations or alternatives, yet nobody has managed to create a knockoff that shows any signs of being an actual substitute. The more money and resources people put in to creating a replacement, the less it seems to function as a substitute for this thing that was created without any need for money or resources.”

It sounds impossible. But there it is. Only Bitcoin has managed to produce a massively valuable product with no financial investment in it at its inception — or since.

The Best Run Organization Has Nobody Running It

Leadership is really hard. How do you choose a leader? And what about their successor when the time comes? How do you depose a leader if they’re not doing their job well? How do you even determine if they’re doing it well? How do you even define the leader’s job correctly? What do you pay them?

And then there’s the same issue with all other employees. And there’s the office politics; and all the other human issues that come up — people get sick, they mistrust each other, their chemistry is off, and the culture needs to be maintained. It all can be such a headache.

Bitcoin’s solution, like with everything else we’ve discussed, is simply, once again, to have none of it. No CEO, no board, no shareholders, no employees, no human resource policies.

“Surely that can’t work, ” a professor of organizational design might complain. “With no employees, no work would get done, no decisions would be made!”

And yet, Bitcoin works better than any company in the world. And all its imitators, which actually are companies that have copied its code and hired employees to modify it, promote it, and issue shares in their spin-off, do not work as well. It’s quite a revolutionary design principle in operating an institution.

The most reliable operation on Earth comes not from hiring the best people, or paying them the best, or having the best directors — it comes from not having employees at all. We give employees way too much credit it seems. (I hope my boss doesn’t want to have a word with me after reading this.)

No Foundation is the Best Foundation to Build On

If you wish to make an apple pie from scratch, you must first invent the universe.


Carl Sagan

Whenever you’re constructing something, you want to make sure it is built on a foundation that will not crumble underneath its weight, taking your construction down with it.

What is Bitcoin “founded” on? Well, legally, there is no foundation of any kind anywhere on Earth for Bitcoin. Bitcoin does not rely on the laws or authorities of any country or countries to acknowledge its existence, to provide legal protections for it, or to enforce its rights. And of course, there are no employees or assets of this non-existent foundation.

Yet every other institution stands on some legally constituted foundation.

And once again, by omitting the things other institutions have, Bitcoin demonstrates a superiority rather than a weakness. Bitcoin’s operation is invulnerable to the collapse or corruption of any aspect of any country’s legal system. Every government in the world could stop enforcing its nation’s laws, or completely change them, or cease to exist and be replaced by new governments of new nations — and Bitcoin wouldn’t notice.

Bitcoin is its own thing entirely and can continue to run as long as anyone in the world wants to run it. It can thus run forever, even as nations rise and fall, as empires crumble and as countless generations pass. Built on no foundation, it is thus built on a foundation that will never crumble. Bitcoin truly is generational wealth, forever.


By having no sense of location, of users, of employees, or even of assets, Bitcoin manages to create an asset invulnerable to weaknesses created by those very things, and thus generates an entirely unique and massively valuable existent that couldn’t exist before — something very special out of lots of nothing.

Tomer Strolight

Tomer Strolight

Tomer Strolight is Editor-in-Chief at Swan Bitcoin. He completed bachelors and masters degrees at Toronto’s Schulich School of Business. Tomer spent 25 years operating businesses in digital media and private equity before turning his attention full time to Bitcoin. Tomer wrote the book “Why Bitcoin?” a collection of 27 short articles each explaining a different facet of this revolutionary new monetary system. Tomer also wrote and narrated the short film “Bitcoin Is Generational Wealth”. He has appeared on many Bitcoin podcasts including What Bitcoin Did, The Stephan Livera Podcast, Bitcoin Rapid Fire, Twice Bitten, the Bitcoin Matrix and many more.

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