Definition ∞ Risk-off trading describes a market sentiment where investors move capital away from higher-risk assets and into safer, more stable investments. In the digital asset market, this often means selling cryptocurrencies and acquiring fiat currencies, stablecoins, or traditional safe-haven assets. It typically occurs during periods of heightened economic uncertainty or market volatility. This behavior indicates investor apprehension.
Context ∞ Risk-off trading is a frequent phenomenon observed in the digital asset market, particularly during broader economic downturns or significant negative news events. Discussions often analyze the triggers for such shifts in sentiment and the assets considered “safe” within the crypto ecosystem. A key future development is understanding how digital assets might evolve to become more resilient during risk-off periods, potentially attracting different investor profiles.
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