Definition ∞ Investor losses refer to the financial detriment experienced by market participants when the current value of their digital assets falls below their acquisition cost. These losses can be either unrealized, meaning the asset is still held but its market price is lower, or realized, occurring when the asset is sold at a price below its purchase price. This metric reflects periods of market downturns and negative investor sentiment.
Context ∞ Cryptocurrency news frequently reports on investor losses, particularly during bear markets or significant price corrections, to illustrate the financial impact on market participants. High levels of unrealized or realized losses can signal widespread financial stress among holders, potentially leading to further selling as individuals attempt to mitigate risk. Understanding this concept provides crucial context for evaluating market pain and potential capitulation events.
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