The biggest problem is that inflationary currencies can't compete with bitcoin. The worst thing you can do to a system based upon "full faith and credit" is to place your support outside of the system. That drains power from the USD. Then the fact that bitcoin has a fixed upper limit and that government can't print up all the bitcoin it needs when their fiat fails will severely limit military powers. Governments know this which is why they went off the gold standard. What stops war? Cost. Without inflationary currency, government would have had to ask for $75,000 from everyone for the Iraq war. Obviously they can't do that which is why bitcoin will put a stop to it assuming it can scale to handle the transaction load of Visa / MC.