With reference to Central Bank digital currencies, consider the following statements : 1. It is possible to make payments in a digital currency without using US dollar or SWIFT system. 2. A digital currency can be distributed with a condition programmed into it such as a time-frame for spending it. Which of the statements given above is/are correct?

1. Statement 1: Central Bank Digital Currencies (CBDCs) offer the potential for direct, peer-to-peer or cross-border payments that could operate independently of traditional correspondent banking networks, which often rely on the US dollar as an intermediary currency and the SWIFT system for messaging. Therefore, it is considered possible to make payments in a digital currency without using these established systems. This statement is correct. 2. Statement 2: One of the potential features of CBDCs is programmability. This means that a digital currency could theoretically be distributed with specific conditions programmed into it, such as limitations on use, or a time-frame for spending it (e.g., an expiry date for stimulus payments). This capability is often discussed, although its implementation raises policy and ethical questions. This statement is correct. 3. Since both statements are correct, the answer is (C) Both 1 and 2.