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Formula fields already see the API name and only the API name (yes, even TEXT(fieldName) gets you the API name, not the label).
Please refer below link for similar discussion.
https://salesforce.stackexchange.com/questions/160356/picklist-api-name-in-formulas
If this helps you, please mark it as solved so that it will be availabe for others as a soultion.
Best Regards,
Sandhya