Currency Markets

Definition ∞ Currency markets are global decentralized marketplaces where individuals, companies, and central banks exchange currencies. These markets facilitate international trade and investment by determining foreign exchange rates. They represent the largest financial market globally, operating continuously across different time zones.
Context ∞ The behavior of traditional currency markets directly influences the valuation and stability of fiat-pegged digital assets, such as stablecoins. Macroeconomic policies, interest rate differentials, and geopolitical events affecting major fiat currencies can trigger significant movements in crypto markets. News regarding currency fluctuations often provides important context for digital asset performance and investor strategies.