Definition ∞ Secondary markets are financial venues where previously issued securities or assets are traded between investors. Unlike primary markets where assets are first sold by issuers, secondary markets provide liquidity and price discovery for existing assets. In the digital asset space, this includes cryptocurrency exchanges where users buy and sell tokens that have already been distributed. These markets are crucial for establishing asset valuation and allowing investors to exit or adjust their positions. Secondary markets facilitate continuous trading activity.
Context ∞ Secondary markets are a fundamental component of the digital asset ecosystem and a constant subject in crypto news. Reports frequently cover trading volumes, liquidity, and price fluctuations on various centralized and decentralized exchanges, which serve as the primary secondary markets for cryptocurrencies and NFTs. Regulatory scrutiny of these markets, particularly concerning investor protection and market manipulation, is a recurring theme. The health and efficiency of secondary markets are vital indicators of the overall maturity and activity within the digital asset sector.
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