Definition ∞ Deep Market Correction refers to a substantial and prolonged price decline across a market or specific asset. This downward movement typically exceeds a 20% reduction from recent highs and indicates a significant shift in market sentiment. It is often driven by a combination of macroeconomic factors, regulatory concerns, or a loss of confidence in the asset itself. Such corrections can reset valuations and eliminate speculative excesses.
Context ∞ The state of Deep Market Correction is often characterized by widespread investor concern and a re-evaluation of asset fundamentals. A key debate revolves around identifying the precise catalysts and the duration of such downturns in volatile crypto markets. A critical future development to watch involves how institutional participation and broader economic conditions influence the frequency and severity of these corrections.
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