The U.S. Military Is Using Bitcoin… To Protect The Dollar?

For years, people have called Bitcoin a speculative asset. But, what if the Pentagon sees it as something much bigger? This week, four-star commander Sam Paparo, the man overseeing the most strategically important naval fleet in the world, suggested that Bitcoin may not just matter as money, but as a national security asset. Our interest in Bitcoin is as a tool of cryptography, a blockchain, and reusable proof of work as an additional tool to secure networks and to project power. That wasn't even the most shocking thing he said. >> We have a node on the Bitcoin network right now. We're doing a number of operational tests to to secure and protect networks using the Bitcoin >> Even in those clips, he doesn't explain the real reason why the United States military is adopting Bitcoin. And this is where things get really interesting. And so, I am I think this protocol is here to stay. I think the computer science of it has direct implications for the projection of power. Today, we're breaking down what Admiral Paparo says the real reason that the United States military wants to adopt Bitcoin. Why Jason Lowry may have been years ahead of the curve, and why Bitcoin may be evolving from a financial asset into an instrument of state power. This is Dante Cook of Bitcoin Simply. Let's go. >> [music] >> Admiral Paparo, yesterday you testified that Bitcoin held potential as a tool for national security. Recent research from the Bitcoin Policy Institute estimates China has approximately 194,000 Bitcoins, while the United States has approximately 328,000 Bitcoins. In this era of digital competition, would it be to our strategic advantage to maintain a lead in this regard as we do with other strategic resources like gold and oil? So, um our interest in Bitcoin is as a tool of cryptography, a blockchain, and reusable proof of work as an additional tool to secure networks and to project power. And so, I am I think this protocol is here to stay. I think the computer science of it has direct implications for the projection of power, not financial, but from a computer science standpoint, from the securing of networks. And so, I am supportive of those applications. Uh all instruments of national power are important, but from the military application standpoint, my interest in Bitcoin is as a computer science tool as projection of power. As we mentioned in the intro, that's Admiral Sam Paparo. He's the commander of the Indo-Pacific Fleet, one of the most strategically important naval fleets in the world. We're talking China, Taiwan, the South China Sea, Korea, global shipping lanes, semiconductors, and the future of AI. So, when Paparo talks about Bitcoin, this isn't some random government official talking about crypto. This is someone whose job it is to think about deterrence, power projection, and how to protect American interests without losing lives. And this is directly connected to a special assistant, Jason Lowry, and his thesis that he lays out in Soft War. People used to call Lowry crazy, but now it's coming from the highest-ranking officials. This is his thesis in a nutshell. For centuries, people have used human life and military power to protect land, real estate, oil, equities, but Bitcoin changes that. Instead of defending value, monetized wealth he calls it, with blood and force, Bitcoin allows value to be defended in cyberspace with energy, computation, and cryptography. Lowry puts it simply, not having to waste human life to defend monetized wealth is worth every white. But, as important as power projection is, it's not the deepest reason why Bitcoin is strategically important to the United States military. The real answer is simpler. I appreciate that. I agree with you, and I'd also like to hear your thoughts on monetary competition over the coming decades. What role does Bitcoin play in spreading digital property rights? Well, I I you know, people use Bitcoin today right now to protect their own intellectual property. Uh and that's the reusable proof of work protocol that's combined with blockchain for accountability and cryptography for security. And so, that's the role that I see for it. Uh I see direct national security implications, and then I'm supportive for anything that maintains our own uh dollar dominance worldwide. I appreciate This is about the dollar and protecting its sovereignty globally. And with the dollar declining in relevance, the United States is losing a strategic way to project its digital power on adversaries across the globe. This is why Scott Bessent says it's so critical that we need to pass the Clarity Act and do it now. >> Can you talk about why it's so important that Congress pass digital asset legislation? Senator, when the United States leads in best practices, safety, and soundness in the financial world, whether [snorts] it's our banking system, the our securities, or now digital assets, it's important for the US to lead for several reasons. One, US leadership over the long term secures the primacy of the dollar as the reserve currency. He gave three points as to why it's important for us to pass the Clarity Act. But, point number one, the dollar sovereignty. Without a hard asset that can't be debased, every fiat system eventually runs into the same problem. More printing, more distortion, more instability, and as always, this leads to more conflict around the world. This is why the United States meddles in other people's business in all places across the globe, because they use the dollar and the dollar system. So, it is their business. And that's what makes this story so interesting, because the United States isn't the only country that's going to realize Bitcoin's strategic importance. The US already projects power through the financial system. It does it through sanctions, banking rails, asset freezes, and access to the dollar itself. This is digital power projection, and we're using it right now with Iran. Last month, the White House announced its maximum pressure campaign on Iran, designed to collapse its already buckling economy. The Iranian economy is in disarray. 35% official inflation has a >> [clears throat] >> official inflation, a currency that is depreciated 60% in the last 12 months, and an ongoing energy crisis. I know a few things about currency devaluations, and if I were an Iranian, I would get all of my money out of the real now. We will close off Iran's access to the international financial system by targeting regional parties that facilitate the transfer of its revenues. Our maximum pressure campaign, designed to collapse Iranian oil exports, we are going to shut down Iran's oil sector. >> Remember when Russian assets were frozen at the beginning of the Ukraine war? This isn't just about finance. This is about geopolitical power being exercised through a monetary system. And in this world, Bitcoin becomes more and more important, because Bitcoin is not just an investment, it's a way to protect against not only physical attack, but also digital attacks, which lead to financial exclusion if you're a weaker adversary. Michael Saylor says it best, Bitcoin is digital energy. But, Bitcoin is also a digital defense system. Because when you have digital energy flowing across a network, you create commerce, as Michael Saylor says. The last and most important metaphor is, when we have open digital energy flowing, it is a commerce network. But, when we reverse that digital energy into a shield, it becomes a defense system. Coins a digital defense system. Coin messages, authentications, transactions, they're unstoppable, corruptible, mutable, immune to tampering by any known cyber threat. You can protect the United States commercial and military and financial systems behind a wall of digital energy. And And that's exactly how we will do it. Even Elon Musk pointed out, the AIs don't know how to hack Bitcoin. They can spoof you out of your money, they can convince you that they're someone they're not. There's no way to trick an 800 exahash digital wall that's based on modern encryption. The AIs won't get through that wall. And one practical way that we allow you to create commerce through your Bitcoin is by borrowing against it. You can get cash from the value of the Bitcoin that you've stacked by using a partner like Ledn. They allow you to unlock liquidity from your Bitcoin without any capital gains. Borrow against your Bitcoin stack. Have fiat come into your account in less than 6 hours. This has no credit checks at rates that are half of what you could get with a credit card. And your Bitcoin isn't resold or rehypothecated in any way. You can see your Bitcoin in a wallet address in the platform. The application takes just 2 minutes. Go to learn.ledn.io/simply to get started. The other way that you can remove digital power projection from the current system is by becoming truly sovereign over your own assets, and that's by holding your own keys. That's by using the whole Bitcoin network for all that it's worth. Don't learn how to do this alone. Schedule a free 30-minute meeting with the team at the bitcoinway.com. Go to the URL thebitcoinway.com/partner/dante-cook, and a member of their team will help you and your family use Bitcoin to its fullest. Back to the show. What's wild is that Jason Lowry was laying out this thesis in 2024, and everybody called him a spook. They said he was part of the CIA. They said he was crazy. They said he was going to get Bitcoin dragged into a war that it couldn't compete against in the media narrative. But, he always viewed that Bitcoin shouldn't be viewed as property, but as a means of protection. He even proposed that Bit Power should be used as a strategic KPI, suggesting that the United States create a hash force in order to help us find ways to unlock energy so that we can unleash the full power of the Bitcoin network on our adversaries in the event that we would be attacked digitally in cyberspace. Comparison of Bitcoin not as a property, but as a weapon system to establish and preserve permissionless control over underlying property. If you have permissionless control over underlying property, to your point, that sounds like you're now sovereign. You're now a group of people running code, so agreeing to a rule of law, funding, paying fees to power projectors to defend your access. You're now creating an a a new sovereign organization. A new sovereign group of people. So, in my opinion, Bitcoin is not just property, it's the whole it's the whole stack. It's the whole tech stack. It's the government, it's the military, and it's the money and the property. And the least impressive part, in in my opinion, is the money and the property because any Joe Schmo can build some shitcoin, >> [snorts] >> but to build a badass power projection military defense architecture over that to preserve permissionlessness and sovereignty over that property is the beautiful thing. And This is where the game theory gets interesting. The properties that make Bitcoin strategically important to the United States also make it strategically important to everyone else because if the current financial system is weaponized, countries still need a way to transact. Commerce still has to happen, and the world still has to function. Countries can't settle things in gold. We've already learned that. And if they can't use the banking rails, well, then what can they use? This is why this clip from former US military executive and leading commander, Colonel Douglas McGregor, in his conversation with Natalie Brunell is so interesting because he understands the geopolitical importance of needing to transact and have something readily available when you're cut out of the system. Listen to this conversation. Bitcoin can go from 10,000 to a million very, very quickly. Now, it's not going to be perfect. There will be speculation. There will be problems. It's a bumpy road. But I think ultimately it will prevail because you can also do business with it. I mean, right now, if you're in Moscow or St. Petersburg, you can't use credit cards. Right. You can't even use your currency. What do you do? You go to the bank, you open a bank account, and then you turn to Bitcoin. And that's how people are financing themselves over over in Russia right now that are from the West. That would be the ultimate chess move is if uh the leaders of Russia or China all of a sudden said, "We're accumulating Bitcoin." I mean, that would be wild in in game theory. And this leads to the real takeaway from this episode. Bitcoin wins no matter what. If the US government and military want to use Bitcoin to protect its dollar sovereignty, well, then Bitcoin gets bid up and Bitcoin wins. If other nations want to use Bitcoin because the dollar system is being weaponized against them, well, Bitcoin wins. In both scenarios, Bitcoin becomes more important on the global stage. In both scenarios, adoption accelerates. And when you have increasing adoption acceleration with a supply diminishing every single day as more Bitcoin is mined to the fixed cap of 21 million, well, then you get an asset that is not only unable to be denied financially, but strategically. This is why the United States wants to lead. This is why it wants to go first. And this is why it makes sense to keep stacking any way that you can, not just by buying spot Bitcoin, but even through strategic ways like Bitcoin mining, increasing the amount of hash rate that is in the Bitcoin network or its digital power projection on the world as Jason Lowry puts it. You can do that and be a part of this by working with a partner like Saz Mining. You give them your money, they give you a Bitcoin miner and sats to your wallet directly with no hassle, no need to repair machines, no need to plug them in, no need to negotiate energy contracts, just straight sats to your wallet. Use the QR code and the information in the description to get started. And this is why you should subscribe to the show. We drop alpha in the real reason behind just the clips that you see online. We give you a different perspective, a different take, a different flavor, something that cuts deeper than the surface level. This is the signal. And this is Dante Cocco Bitcoin Simply. Happy stacking. >> [music] [music] [music]