CBDCs could indirectly impact Bitcoin’s monetary policy by influencing global inflation rates. While Bitcoin has a fixed supply, mimicking digital scarcity, CBDCs could potentially be created in unlimited quantities, similar to traditional fiat currencies. If central banks abuse this power, it could lead to increased inflation, eroding the purchasing power of CBDCs and, by extension, potentially impacting Bitcoin’s value as a hedge against inflation. Although Bitcoin is designed to be deflationary in the long run, the perception of increased global inflation due to CBDC issuance could negatively affect investor sentiment towards all cryptocurrencies, including Bitcoin. This macroeconomic factor could create headwinds for BTC’s price appreciation.