How to Understand Bitcoin's Power Projection for U.S. Military Strategy

Introduction

In April 2026, Admiral Samuel Paparo of U.S. Indo-Pacific Command (INDOPACOM) told the Senate Armed Services Committee that Bitcoin is a "valuable computer science tool as power projection" and revealed his command is running a Bitcoin node. This statement, coming shortly after Iran demanded Bitcoin for safe passage through the Strait of Hormuz, points to a deeper strategic concept. This step-by-step guide will help you understand what Bitcoin's "power projection" means for the U.S. military, based on the work of Jason Lowery and official military definitions.

What You Need

• Basic understanding of Bitcoin (blockchain, mining, proof-of-work)
• Familiarity with military terms like deterrence and power projection
• Openness to theoretical cybersecurity concepts
• Access to the internet (for optional further reading)

Step 1: Learn the Official Definition of Power Projection

Start with the Department of Defense's 2002 definition: “The ability of a nation to apply all or some of its elements of national power – political, economic, informational, or military – to rapidly and effectively deploy and sustain forces in and from multiple dispersed locations to respond to crises, to contribute to deterrence, and to enhance regional stability.”

In simple terms, power projection is influencing other nations or entities beyond your borders. Examples include long-range missiles, aircraft carriers, diplomatic pressure, and economic sanctions.

Step 2: Recognize the Deterrence Challenge in Cyberspace

Deterrence, as the DoD defines, is “Prevention from action by fear of the consequences. ... a state of mind brought about by the existence of a credible threat of unacceptable counteraction.” In the physical world, a powerful navy or nuclear arsenal creates deterrence. But in cyberspace, traditional deterrence doesn't work well because attackers can be anonymous, attacks are cheap, and attribution is difficult. This creates a gap that needs a new kind of power projection.

Step 3: Explore Jason Lowery's Theory of Bitcoin as a "Macrochip"

Jason Lowery, an MIT fellow and special assistant to the INDOPACOM commander, wrote a thesis and book titled Softwar: A Novel Theory on Power Projection. His central idea: just as microchips use encoded electric power to process logic inside a computer, the entire global electric grid can be seen as a "macrochip". Bitcoin mining turns electricity into a universally verifiable proof of work, creating a physical cost for digital actions.

Lowery argues this physical dimension gives Bitcoin the ability to project power in cyberspace. By forcing any potential adversary to expend real energy and hardware to attack, Bitcoin can create a credible deterrent. The book gained popularity but was later taken down at the request of his superiors, suggesting the military finds the ideas strategically significant.

Step 4: Understand Proof-of-Work as Physical Power Projection

Bitcoin's proof-of-work requires miners to spend electricity and computing power to secure the network. This energy expenditure creates a finite cost that cannot be faked. Lowery calls this "power projection" because it uses physical resources to influence digital events. For example, if an adversary tried to rewrite Bitcoin's history, they would need to out-spend the entire global mining network—something currently prohibitively expensive.

This makes Bitcoin's proof-of-work a form of deterrence: anyone considering attacking the network knows they would incur enormous, verifiable costs.

Step 5: Connect to Real-World Military Applications

Admiral Paparo's comment and INDOPACOM's Bitcoin node experiments show the military is looking at this seriously. The Iran case further illustrates the concept: by demanding Bitcoin for safe passage, Iran is using a digital asset as a geopolitical tool, projecting economic power. Conversely, the U.S. could use Bitcoin's mining infrastructure as a strategic asset—for example, by deploying portable miners to secure communications or as a bargaining chip.

Lowery's work suggests that nations may start viewing Bitcoin mining as a form of military power projection, comparable to building a navy or air force.

Step 6: Consider Criticisms and the Military's Interest

Not everyone agrees with Lowery. Critics argue Bitcoin mining is an energy waste and that its security model can be bypassed via social or regulatory attacks. However, the military's interest indicates they see potential in the physical cost aspect. The fact that Lowery's book was pulled from distribution only fuels speculation that the military wants to keep some insights confidential.

For a balanced view, read both supporters and detractors. The key takeaway: Bitcoin introduces a new domain of power projection that the U.S. military is actively studying.

Tips for Deeper Understanding

• Read the original sources: The DoD dictionary definition is a starting point. Also look up Lowery's MIT thesis (if available).
• Track military announcements: Follow INDOPACOM statements for any updates on the Bitcoin node experiment.
• Consider the energy angle: Bitcoin mining's tie to energy policy often overlaps with national security—research how countries like the U.S. and China view mining as strategic infrastructure.
• Stay critical: The "macrochip" analogy is interesting but debated. Form your own opinion by evaluating the arguments.
• Explore related concepts: Look into cyber deterrence theory and how other cryptocurrencies or blockchain technologies might similarly project power.

By following these steps, you can grasp why a military commander called Bitcoin a "valuable tool for power projection" and how it might reshape cybersecurity and defense strategy.