I meant only to imply that the US military alone is about 3.5% of our economy, and that the protection to value ratio there is about 1:30

I did not mean to imply that bitcoin could replace the entire military, only that the ratio of spending vs. assets defended is better.

The protection to value ratio is drastically beyond 1:30. Your value calculation is worthless if it only takes into account annual GDP.

The total value of the United States, all assets, private and public, is closer to $250+ trillion [1]. That's a 1:400+ ratio.

US household assets alone are near $95 - $100 trillion at this point [2]. That's a ~1:160 ratio just for household wealth.

You missed by an extreme amount in your speculation and that's just based on present value. If we were going to be rational about it, we'd want to consider that present military expenditures help to keep safe future value creation (I'll note that I'm not arguing whether those expenditures are $n too high or too low).

[1] https://en.wikipedia.org/wiki/Financial_position_of_the_Unit...

[2] http://www.reuters.com/article/us-usa-fed-households-idUSKBN...

The military is also not the only protection system in place. You are right, just considering the GDP is too limited, but considering just the military is also too limited. Police, fireman, courts, security systems, the SEC, locks, alarms, etc all contribute to protecting assets in the US.

It's a hard number to measure. Bitcoin inflation has a fixed measurable cost though (12.5 coins per 10 minutes), if that's acceptable to you for the benefits you get, then it's money well spent burning electricity.