Bitcoin's Role in the Power Projection Game (part 3)

Briefing Notes for 'classic' interviews

Besides covering new material, I am also posting briefing notes for select high-profile podcasts from over the past few years. As part of my own Bitcoin horizon scanning research, I have summaries for all podcasts going back to the start of 2023 and sporadic coverage for 2021 and 2022 (for specific summary requests, please reach out).

Summary

This briefing note summarizes the February 9, 2022 What is Money podcast, the third of five installments that deep dive into Jason Lowery's ideas on Bitcoin's role in reshaping global power dynamics. In this episode, Robert Breedlove and Jason Lowery discuss Bitcoin's role as a digital weapon system, highlighting its use of electric power projection to secure digital property rights. Lowery argues that Bitcoin’s decentralized governance and non-lethal power projection present a new model of sovereignty that challenges traditional military and economic power structures, potentially reshaping global security dynamics.

Briefing Notes for other episodes in this series are available here:

• Part 1: Bitcoin and the Power Projection Game
• Part 2: The Evolution of Property and Warfare
• Part 3: Bitcoin as a Weapons System (this episode)
• Part 4: Life, Energy, and Entropy
• Part 5: Bitcoin and US Geopolitical Strategy

Take-Home Messages

1. Digital Sovereignty through Bitcoin: Bitcoin’s decentralized and permissionless control structure offers a novel form of digital sovereignty, redefining how power and property rights are secured.
2. Non-Lethal Power Projection: Bitcoin replaces traditional kinetic military power with electric power projection, offering a secure, non-violent alternative for defending digital assets.
3. Strategic Integration Potential: As a strategic asset, Bitcoin could be integrated into national defense frameworks, altering the traditional approaches to sovereignty and security.
4. Decentralized Governance Benefits: By removing human biases from governance, Bitcoin establishes a trustless and secure system for managing digital property rights.
5. Mutually Assured Preservation: Bitcoin’s model promotes a shift from mutually assured destruction to mutually assured preservation, potentially reducing global conflict.

Overview

Jason Lowery presents his thesis that Bitcoin functions as a revolutionary digital weapon system, offering a non-lethal form of power projection through energy expenditure. Unlike traditional military forces that rely on physical power, Bitcoin secures digital property rights using electric power, positioning itself as a new form of digital sovereignty. Lowery describes the Bitcoin network as a decentralized governance structure where nodes act as legislators and miners serve as power projectors, defending the network’s integrity and providing permissionless control over digital assets.

Lowery emphasizes the strategic value of Bitcoin’s governance model, which eliminates the need for centralized authorities and reduces the influence of human biases. This permissionless system allows participants to maintain control over their assets through economic incentives rather than physical force. The podcast highlights how this approach differs fundamentally from traditional forms of governance and defense, presenting a robust alternative that relies on decentralized power projection.

The discussion also delves into the broader implications of Bitcoin’s power projection model on global geopolitics. Lowery suggests that as nation-states recognize the strategic advantages of Bitcoin, they may seek to integrate it into their national defense strategies. This shift could redefine sovereignty and reduce the reliance on kinetic military actions, promoting a more stable and cooperative global order driven by shared economic interests rather than violent conflict.

Ultimately, Lowery’s insights underscore Bitcoin’s potential to transform financial systems and the foundational structures of global power. By enabling a decentralized, non-lethal approach to securing property rights, Bitcoin offers a novel path to global security and stability.

Stakeholder Perspectives

• Policymakers: Recognize Bitcoin as a potential strategic asset that could reshape national security frameworks and challenge traditional defense models.
• Investors: View Bitcoin as a resilient investment, given its decentralized network and strategic use of power projection to secure digital assets.
• Military Strategists: May see Bitcoin as a disruptive force necessitating a reevaluation of traditional military strategies in favor of digital sovereignty models.
• Bitcoin Community: Embraces Bitcoin’s promise of digital sovereignty and permissionless control, valuing its ability to empower individuals and reduce reliance on centralized authorities.
• Global Geopolitical Actors: Acknowledge the potential for Bitcoin to alter global power balances, influencing how nation-states secure and project power in the digital era.

Implications

The implications of Bitcoin’s power projection model are far-reaching, potentially redefining global security and economic stability. For policymakers, integrating Bitcoin into national defense strategies offers a chance to reduce reliance on traditional military power and explore new forms of digital sovereignty. This could lead to a shift towards mutually assured preservation, where economic incentives replace physical force as the primary means of securing national interests.

For investors, Bitcoin’s strategic value extends beyond its financial properties, highlighting its potential as a robust and secure asset in a volatile global landscape. The decentralized nature of Bitcoin’s network makes it resilient against state-level threats, offering a stable investment option in an increasingly digital world. However, the integration of Bitcoin into global strategic frameworks also raises questions about governance, resilience, and the potential for state competition over control of mining operations.

Future Outlook

Bitcoin’s role as a digital weapon system could reshape how global power and sovereignty are managed. As more nation-states explore integrating Bitcoin into their strategic frameworks, the focus may shift from kinetic military engagements to non-lethal power projection models. This evolution could foster a new era of international cooperation, driven by shared economic interests rather than violent conflict.

The strategic importance of Bitcoin’s energy monetization also suggests a growing intersection between digital and physical domains of power. As Bitcoin continues to secure its network through decentralized power projection, it could become a cornerstone of national defense strategies, challenging traditional military-industrial complexes and opening new avenues for leveraging digital technologies to achieve strategic objectives.

Information Gaps

• How will Bitcoin's model of electric power projection influence global economic power dynamics? Understanding the influence of Bitcoin’s power projection model on global economic dynamics is critical, as it could disrupt traditional power structures and shift the balance of economic influence in unpredictable ways.
• What measures can be implemented to protect Bitcoin mining operations from physical attacks by nation-states? With the physical security of Bitcoin mining infrastructure being crucial to the network’s integrity, identifying protective measures is essential to maintaining the network’s resilience against state-level threats.
• How can Bitcoin’s decentralized governance model effectively manage conflicts and avoid fragmentation? Effective governance within Bitcoin’s decentralized structure is vital for its stability. Research into conflict management and consensus-building mechanisms will help ensure the network’s continued success.
• What are the geopolitical implications of nation-states adopting Bitcoin as a strategic asset? The adoption of Bitcoin by nation-states could significantly alter global power dynamics. Understanding these implications is critical for policymakers and strategists as they navigate the integration of Bitcoin into national defense frameworks.
• How does Bitcoin’s model of mutually assured preservation differ from traditional concepts of mutually assured destruction? Bitcoin introduces a novel approach to global security that contrasts with conventional military strategies. Exploring the implications of this shift will provide insights into how Bitcoin could influence future international relations and reduce violent conflicts.

Broader Implications for Bitcoin

Digital Sovereignty and Individual Empowerment

Bitcoin’s model of digital sovereignty empowers individuals by providing permissionless control over their digital assets. This decentralization reduces the reliance on centralized financial institutions and offers a secure means of managing wealth in an increasingly digital economy. As more individuals and entities adopt Bitcoin, the broader implications could include a significant shift towards personal financial autonomy, potentially challenging existing financial systems and regulatory frameworks.

Challenges to Traditional Military and Economic Structures

Bitcoin’s role as a digital weapon system may challenge established military-industrial complexes and traditional economic power structures. As a non-lethal form of power projection, Bitcoin offers a cost-effective and secure alternative to kinetic military force, which could disrupt industries that rely on traditional defense mechanisms. The economic impact of energy monetization within the Bitcoin network also poses a potential threat to conventional energy markets and economic models that are not aligned with this new paradigm.

Evolution of Global Cooperation and Conflict Resolution

The shift towards a model of non-lethal power projection and mutually assured preservation could promote new forms of global cooperation. Bitcoin’s decentralized and permissionless system encourages collaboration based on shared economic incentives rather than coercive force. This evolution could reduce the prevalence of violent conflicts and encourage more stable and predictable international relations, as stakeholders recognize the mutual benefits of securing digital assets without resorting to physical warfare.