Bitcoin is just another tool in the full suite of necessary defense capabilities. You're exactly right. You need to prepare for physical violence too. You still exist in meat space. However, you will notice, you still have to choose to agree with them (China or whoever wants to possess your Bitcoin). They can't take your Bitcoin. They can only punish you for not agreeing that they can take your Bitcoin.

Bitcoin is a way to teleport real resources into places it's very difficult to get other weapons, cash or gold. It can't be confiscated quite so easily, it's trivial to claim it doesn't exist when it's in your head. It can be used very effectively by oppressed people, to resist their regimes. They still need to put themselves at physical risk, and physically liberate themselves across borders, etc. but they will have something they didn't have before. Money. Some assets to bring along, to get settled to make it somewhere without starving. On the national level, it's more about the monetary fuckery of debasement and hypothetical gold reserves or other shadow banking and sanction evasion. But the idea is the same. Bitcoin is a physical power to resist corruption and oppression by undemocratic or foreign agents.