Has it had any long-term impact on Bitcoin, or just short-term market reactions, which are sometimes almost unnoticeable?
My advice to all Bitcoin holders in and out of banned countries is to, make your security your highest priority, and afterwards, try never to get distracted in your walk to a more developing and advanced future with Bitcoin.
Your title and post suggest that you are an Israeli and your government banned BTC just because rivals of your country, or vice versa, are using BTC to fund themselves in the war. Well, what you think it is is an attempt or an attack on the opponent. But they might be causing trouble for their own citizens like you. And you are now suggesting people like you hold back and use the BTC, right?
Well, to be honest, BTC was never meant to be used as war money, and I don't think it has been used as one, because that's simple money laundering, and BTC is not suitable for ML. You might not agree with me, but statistics show that BTC is the hardest way to land money.
I will say that China banned crypto for many reasons; some say they manipulated it, but there were energy and other crises, so they had to ban it, and now they have accepted the crypto, using their second nation (Hong Kong) to accept the BTC and use all of its features. BTC has something in it that governments have relearned and made rules around.