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Average Acquisition Cost

Definition ∞ Average acquisition cost represents the average price paid for a specific digital asset across all purchases made by an investor. This metric calculates the total cost of all asset purchases divided by the total quantity of the asset held. It provides a benchmark for an investor’s profitability or loss on their holdings. Understanding this value is crucial for assessing portfolio performance.
Context ∞ Average acquisition cost is a key reference point for investors monitoring their digital asset portfolios and evaluating market positions. It is often referenced in discussions about investor sentiment and potential selling pressure when current prices approach this average. News reports frequently cite this metric when analyzing market bottoms or profit-taking events.

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Valuation Metric Confirms Bitcoin Structural Market Reset Is Underway

The market's average cost basis has broken, signaling a necessary structural reset and compressing unrealized profits for the first time in three years.