CBDCs are fundamentally different from Bitcoin in design and purpose: they are digital representations of fiat, centrally controlled, and typically not intended as an investment or store of value outside the domestic currency context. This distinction means that while CBDCs might compete with Bitcoin for payment functions, they are less likely to replicate Bitcoin’s value proposition as a scarce, decentralized asset, allowing BTC to maintain a distinct role in the market.
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Another view emphasizes trust and authority. CBDCs are backed by states and legal systems, making them attractive for users who prioritize stability and compliance. This creates competition for Bitcoin in terms of perceived safety and transactional reliability. For BTC, the pressure lies in being framed as risky or unnecessary when a state-backed digital alternative exists, even if Bitcoin’s core value proposition is different.
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Chainlink’s market position is still solid, especially among established DeFi protocols. Trust and reliability matter more than marginal improvements. Yet, competitors are rising by targeting underserved needs. Pyth shines in trading-heavy ecosystems, while API3 challenges traditional oracle incentives. This growing diversity suggests that the oracle market will not be monopolized forever, even if Chainlink remains the leader.
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