The issue I have with referring to the current situation as a bubble is that this isn’t just hype. The technology really is amazing, and far better than what people had been expecting. I do think that most current attempts to commercialize it are premature, but there’s such a big first-mover advantage that it makes sense to keep losing money on attempts that are too early in order to succeed as soon as it is possible to do so.
What occasions are you referring to? I know people claim that Israeli use of white phosphorous munitions is illegal, but the law is actually quite specific about what an incendiary weapon is. Incendiary effects caused by weapons that were not designed with the specific purpose of causing incendiary effects are not prohibited. (As far as I can tell, even the deliberate use of such weapons in order to cause incendiary effects is allowed.) This is extremely permissive, because no reasonable country would actually agree not to use a weapon that it considered effective. Something like the firebombing of Dresden is banned, but little else.