Softwar: A Novel Theory on Power Projection and the National Strategic Significance of Bitcoin

Current analysis of Bitcoin’s underlying proof-of-work technology is almost exclusively based on financial, monetary, or economic theory. Recycling the same theoretical frameworks when performing hypothesis-deductive analysis of Bitcoin has the potential to create systemic-level analytical bias which could negatively impact public policy making efforts and could even pose a threat to US national security.

This thesis introduces a novel theoretical framework for analyzing the potential national strategic impact of Bitcoin as an electro-cyber security technology rather than a peer-to-peer cash system. The goal of this thesis is to give the research community a different frame of reference they can utilize to generate hypotheses and deductively analyze the potential risks and rewards of proof-of-work technologies as something other than strictly monetary technology. The author asserts it would be beneficial for researchers to explore alternative functionality of proof-of work technologies to eliminate potential blind spots, provide a more well-rounded understanding of the risks and rewards of proof-of-work protocols like Bitcoin, and positively contribute to the development of more informed public policy in support of the March 2022 US Presidential Executive Order on Ensuring the Responsible Development of Digital Assets and the May 2022 US Presidential Executive Order on Improving the Nation’s Cybersecurity.

Utilizing a grounded theory methodology, the author combines different concepts from diverse fields of knowledge (e.g. biology, psychology, anthropology, political science, computer science, systems security, and modern military strategic theory) to formulate a novel framework called “Power Projection Theory.” Based on the core concepts of Power Projection Theory, the author inductively reasons that proof-of-work technologies like Bitcoin could not only function as monetary technology, but could also (and perhaps more importantly) function as a new form of electro-cyber power projection technology which could empower nations to secure their most precious bits of information (including but not limited to financial bits of information) against belligerent actors by giving them the ability to impose severe physical costs on other nations in, from, and through cyberspace. The author calls this novel power projection tactic “softwar” and explores its potential impact on national strategic security in the 21 st century. Like most grounded theory research efforts, the primary deliverable of this thesis is a novel theory rather than deductive analysis of a hypothesis derived from existing theory.