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This happens all the time. All NATO countries rotate their fighter jets to Iceland at some interval.
This has nothing to do with the Greenland situation.
You usually don't want to carry a passport with you at all times. In some European countries (e.g., the Nordics), you have your ID, driver’s license, firearm license, etc., all in a government app that can be verified with an app used by officials. You can also sign and authenticate all paperwork with the same system