Countries with free speech and no capital controls, ie the west, bitcoinize.
Countries with controlled internet and capital controls, ie china, act like fiatland.
Who wins the war. It's not an easy question. It's not an obvious answer.
But it's true. You can't have both.
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One reason to hope for the west over fiatland in a conflict is, defense contractors and soldiers and police would rather get paid in a hard currency.
So at some point fiatland may just collapse.
That doesn't mean no more wars.
Bitcoin country 1 can tax and borrow, and wage war against Bitcoin country 2, who can do the same.
I never subscribed to bitcoin equals forever peace. Bitcoin doesn't cure cancer either, or wash your car.
But the extent of the taxing and borrowing is at least constrained.
But only one cryptocurrency can have the greatest proof of work. Unlike with counterfeit gold, this is easy and cheap to verify. And the cryptocurrency with the greatest proof of work is most secure (against 51% attack) from those who would seek to weaken, control, or destroy it. By its definition, proof of work crypto is a winner-take-almost-all market.
Capital controls are not necessary for a bitcoin dominated world.
I understand why gold got centralized into USA during WW2 (physical security, costly to assay). Why does increasing BTC difficulty lead to miner centralization?
Unless there's some other angle to convince miners to continue mining unprofitably, which feels like defeats the whole purpose of a crypto-maximal economy to me.
Also, hash rate and reward value don't always correlate - mining difficulty can increase during periods of flat or declining coin price.
"Since the start of organized warfare, the crucial sinew of war had been “endless streams of money.”
Ok. So you're a nation whose official currency is backed by Bitcoin. Suppose that years of economic depression have left your country's Bitcoin reserves relatively sparse. Suddenly, your neighboring country Fiatland is starting to mobilize for war thanks to their freshly printed money. Meanwhile, your nation is only able to raise Bitcoin bonds that must be paid with interest from your already tight Bitcoin reserves. Due to the uncertainty caused by the looming threat of war, Bitcoin interest rates skyrocket, so you're even further limited by the how much you're able to finance. The very obvious solution to this problem is to switch to fiat currency, so you're no longer constrained by some arbitrary limit defined in 2008.