Central Bank Digital Currencies (CBDCs) could challenge Bitcoin’s decentralized value proposition. While CBDCs are government-backed and centralized, Bitcoin’s appeal lies in its decentralized nature, offering financial independence from central authorities. If widely adopted, CBDCs could reduce the demand for decentralized cryptocurrencies as they provide similar functionalities without the risk of volatility. However, Bitcoin’s resistance to censorship and the trust in its decentralized framework could continue to support its appeal among users seeking financial autonomy and privacy.