Definition ∞ Bear market risk refers to the potential for significant and sustained declines in asset prices across a market. This risk includes the possibility of widespread investor pessimism and decreased liquidity. It represents the exposure to financial losses during periods of negative market sentiment. Such conditions often lead to reduced trading activity and capital outflows.
Context ∞ Bear market risk is a constant concern in cryptocurrency news, influencing investor strategies and project viability. Current discussions frequently focus on macroeconomic indicators and their potential impact on digital asset valuations. Preparing for or mitigating this risk involves portfolio diversification and understanding market cycles.
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