Definition ∞ A crypto crash is a sudden, substantial, and widespread decline in the market value of cryptocurrencies. This event signifies a rapid and significant depreciation across a broad range of digital assets, often exceeding a 20% or greater value loss within a short timeframe. Such market corrections can be triggered by various factors, including regulatory crackdowns, major security breaches, macroeconomic shifts, or significant liquidations. A crypto crash typically reflects a severe loss of investor confidence and increased selling pressure.
Context ∞ Crypto crashes are frequently reported in financial news, causing considerable concern among investors and market observers. Discussions often revolve around identifying the underlying causes, assessing the impact on market participants, and forecasting potential recovery periods. These events prompt regulatory scrutiny and influence public perception of digital asset market stability, often leading to calls for greater oversight and risk mitigation measures.
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