Definition ∞ A Price Floor represents a specific price level below which a digital asset’s value is unlikely to fall due to strong buying support or underlying economic factors. This level acts as a significant area of demand, where purchasers are willing to step in and acquire the asset, preventing further depreciation. It is often established by concentrated cost bases of long-term holders or large institutional bids. A sustained Price Floor suggests market stability and confidence.
Context ∞ Crypto news frequently discusses the identification of Price Floors as critical technical and on-chain support levels. Analysts often look to metrics like realized price or aggregate cost bases to pinpoint these significant zones. The ability of an asset to hold above a perceived price floor can signal a potential market reversal or a period of accumulation.
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