Definition ∞ A digital asset correction is a price reversal where a digital asset’s value decreases by a significant percentage after an upward trend. This adjustment is generally seen as a healthy market mechanism, removing speculative excesses. It is distinct from a market crash, typically being less severe and often leading to a more stable price floor.
Context ∞ Digital asset corrections are regularly discussed in crypto news, providing context for market movements. Analysts often view them as necessary for sustainable growth, allowing markets to consolidate before potentially resuming an upward trajectory. Understanding corrections helps distinguish normal market cycles from more severe downturns.
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