Definition ∞ New Money Demand refers to the influx of fresh capital from outside the existing cryptocurrency ecosystem into digital assets. This demand typically originates from institutional investors, retail participants previously uninvolved in crypto, or traditional financial markets. It signifies a broadening adoption base and contributes to overall market capitalization growth.
Context ∞ Tracking new money demand is a key indicator for assessing the overall health and expansion trajectory of the digital asset market. Events such as the approval of spot ETFs or significant venture capital allocations often correlate with periods of heightened new money demand. This metric provides crucial context for understanding market rallies and the long-term sustainability of asset valuations.
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