US Can’t Lose Bitcoin Race to China, Military Eyes BTC for Power Projection

The U.S. military is now looking at Bitcoin (BTC) as part of national security planning and power projection. Weird sentence, but it fits the moment. My take: the shift is bigger than traders want to admit. Bitcoin is no longer treated only as a speculative trade. In Washington, it is starting to look like infrastructure. Some of the pressure comes from China, which is pushing the digital yuan while also holding a large BTC reserve. Two tracks: one state controlled, one decentralized.

For decades, the U.S. dollar has carried American power overseas. Sanctions. Trade settlement. Reserve status. That system does the heavy lifting. Digital assets make the picture messier, especially when payment rails can move outside traditional bank channels. Whoever leads this space may get more say over payment rails and sanctions enforcement. Financial access during conflict sits in the same bucket. China is not waiting for agreement. The Chinese Communist Party (CCP) has pushed the digital yuan to tighten state control and build payment channels outside the U.S.-led system. At the same time, China is still tied into crypto through mining hardware supply chains and the second largest state held bitcoin reserve. That gives Beijing options if the financial system keeps shifting.

This is not just a currency story. It is a security story. Most guides frame Bitcoin as either a libertarian asset or a risk trade. That is only half right. Secretary of War Pete Hegseth said during a congressional hearing last month that the military is moving to use Bitcoin to project power and counter China’s digital authoritarian model. Some of the work is still classified, which is what you would expect here. U.S. Indo-Pacific Commander Admiral Samuel Paparo also testified that Bitcoin can be used for power projection and said the military has already run a live node on the Bitcoin network for operational testing. Why does this matter? Because running a node is not a press release; it is a technical test inside the actual network. That is a real signal. It suggests BTC is being tested as a national resource, not just something retail traders buy on a red candle. For markets, that could matter. If the U.S. government treats Bitcoin as useful infrastructure, the current $61.4K resistance level starts to look less like a ceiling and more like a test.

The Pentagon is also studying whether Bitcoin can improve cyber defense by replacing “soft code with hard physics,” as Major Jason Lowery puts it. I’ll be honest: the phrase sounds awkward until you sit with the mechanics. The idea is clear enough: use Bitcoin’s physical proof of work layer for more than payments. President Trump has also said he wants to create a Strategic Bitcoin Reserve and put the U.S. in position to hold the largest state bitcoin reserve in the world. If that happens, it would be a major macro flow event. Government buying is not the same as another hedge fund adding exposure. It would tell markets that BTC has a permanent place on the national balance sheet. The closest recent comparison is the spot Bitcoin ETF approval earlier this year, after which BTC pushed above $70,000.

If the U.S. wants to compete, it needs the infrastructure: mining capacity and compute. It also needs clear rules. Then it needs a serious bridge between digital assets, national security, and economic policy without treating the whole sector like a casino. Counter to the usual advice, more caution is not always the safer path. Critics call Bitcoin too volatile or too risky, and yes, it is volatile. Nobody who has watched a BTC chart for more than a week can pretend otherwise. But gold has swung for decades and still sits in reserve portfolios. Bitcoin’s scarcity and decentralized design make it a useful complement to older assets. Criminals have used crypto, but blockchain records have also helped law enforcement track and break up illicit flows. The bigger risk is letting rivals decide what this technology becomes. That puts pressure on agencies like the SEC. Heavy handed regulation pressure may hurt U.S. security interests instead of protecting investors. A clearer rulebook could bring more capital into U.S. crypto infrastructure and support sector names, including exchange tokens and public companies like COIN.

What this means

Senior U.S. military and political figures are now talking about Bitcoin as a national security tool. That changes the frame. BTC is being discussed less like a trade and more like a reserve asset, closer to gold or oil than a meme chart on a Sunday night. Yes, this pushes against the old “Bitcoin is outside the state” story. Bear with me. If that view spreads, state level accumulation becomes easier to imagine. So does deeper integration into defense and economic strategy. For traders, the point is simple: Bitcoin may have a bid underneath it that is not tied only to halving cycles or ETF flows. Retail appetite is no longer the whole story. Geopolitics is entering the chart.

Investors should watch for policy, not just speeches. The proposed Strategic Bitcoin Reserve is the main item. So are future congressional hearings and executive orders. Military disclosures matter too. Crypto infrastructure bills may matter even more. Is this overkill for one asset? Not if the asset is being discussed in the same breath as power projection. On the chart, BTC still needs a clean break above its all time highs to show that this story has real buying behind it. If policy starts moving and the market follows, $100,000 becomes a realistic medium term target. Not guaranteed. But no longer ridiculous.