Decided to make a post out of this since my comment would be drowned otherwise. I'll keep it short.

A hot girl doesn’t make you nervous because she’s hot, she makes you nervous because sleeping with her represents a personal victory, and getting rejected by her represents a personal defeat.

While this is correct, it doesn't explain WHY it is a personal victory / defeat.

It's all about value. All of us have a certain idea about our own SMV. Women have this too. When a low SMV man approaches a woman, who perceives herself as higher SMV than that man, she will take it as an insult. Why? Because she believes the man to be of a lower SMV, and if he thinks he has a shot with her, he must see her SMV as close to his. This is the insult: the man implicitly tells the woman she's low(er) SMV. Experienced redpillers will have been approached by lower SMV women and thought: 'you really believe you stand a chance getting with me?'. Couple this with insecurity and you get a woman's mind, and why they take it as an insult/personal defeat.

TRP's goal is to increase SMV. When you've 'proven' your SMV by (repeatedly, or LTR) getting a woman of a certain SMV, you'll no longer get nervous with women of her SMV. 'Hot girls' that make you nervous will have a higher SMV (in your own subjective opinion) than you attribute to yourself. This poses the opportunity to measure your perceived SMV in her eyes, and your own: getting with 'hot girls' (consistently) means your SMV is above theirs (women only date up)!

So getting with this hot girl feels like a true evaluation of your SMV, and thát is what makes you nervous.

If you would get her, it'd feel like a personal victory (higher SMV). If you wouldn't it'd feel like a personal defeat (lower SMV).

Disclaimer: how women see your SMV depends on how you act. If you get nervous, she'll know, and link it with a low self worth (low SMV). Take the woman of the pedestal, ignore your emotion, be rational, behave as you would with a low SMV girl and prove her (and yourself) your SMV is higher than hers!