Crypto Winter

Definition ∞ Crypto winter refers to an extended period in the cryptocurrency market characterized by significantly declining asset prices, reduced trading volume, and a general loss of investor confidence. During this phase, many digital assets experience substantial value depreciation, often accompanied by widespread layoffs in crypto companies and decreased venture capital investment. It represents a bear market cycle within the digital asset ecosystem.
Context ∞ News reports frequently track market indicators and expert opinions to determine if the industry is entering or exiting a crypto winter, impacting investor sentiment and strategic decisions. A key discussion revolves around the resilience of various protocols and companies during these downturns, testing their underlying fundamentals. Future developments focus on institutional adoption and regulatory clarity, which could potentially temper the severity and frequency of such market cycles.