Pentagon runs classified Bitcoin programs to counter China

Defense Secretary Pete Hegseth told the House Armed Services Committee on April 30 that the Defense Department runs classified Bitcoin programs on two tracks: enabling the technology and countering it. He testified that those efforts are intended to give the United States leverage against China in a range of scenarios.

Hegseth described himself as “a long enthusiast of Bitcoin and crypto potential” and said many enabling or defeating activities are classified. He made the remarks while responding to questions from Rep. Lance Gooden, who characterized Bitcoin as a national security issue and cited Iran demanding Bitcoin at the Strait of Hormuz, North Korean ransomware operations, and China’s accumulation strategies as examples of strategic use.

U.S. Indo-Pacific Command leadership confirmed earlier in April that the command operates a live Bitcoin node and conducts operational protocol testing. Admiral Samuel Paparo testified that the command is testing how the protocol behaves in operational environments and described Bitcoin as a computer-science system built on cryptography and proof-of-work that can impose real-world costs in cybersecurity settings.

Running a Bitcoin node means maintaining a copy of the public ledger and validating transactions. Protocol testing can show how the network responds to different conditions or attacks, which can inform defensive work, offensive tactics or other operations.

An executive order signed in 2026 established a U.S. strategic Bitcoin reserve initially seeded with about 200,000 coins from government forfeitures.

Estimates place Russia at roughly 16% of global Bitcoin mining hashrate and China at about 12% through underground and offshore operations despite a 2021 domestic ban. Officials say control of mining capacity and related infrastructure can affect how resilient or vulnerable networks are to disruption.

Officials did not provide timelines, program locations or detailed operational objectives in open session. The Pentagon’s acknowledgement and Indo-Pacific Command’s confirmation add to a record of U.S. government engagement with Bitcoin across policy, law enforcement and defense channels.