The global development of Central Bank Digital Currencies (CBDCs) significantly impacts the crypto market. CBDCs, being government-backed, may compete with decentralized cryptocurrencies like Bitcoin, potentially reducing their adoption as alternative stores of value or payment methods. However, they could also legitimize digital currencies, driving broader acceptance and infrastructure development, indirectly benefiting crypto markets. Increased regulation and surveillance through CBDCs might push privacy-focused investors toward decentralized options. Conversely, if CBDCs integrate blockchain technology, they could bridge traditional finance and crypto, fostering innovation but also centralization risks, affecting crypto’s original ethos and market dynamics.