Definition ∞ Structural supply reset refers to a fundamental change that significantly alters the available quantity of a digital asset. This event is typically driven by protocol-level modifications, such as a halving event that reduces new coin issuance, or a large-scale burning mechanism that permanently removes coins from circulation. It creates a new, lower supply equilibrium, impacting the asset’s scarcity and long-term valuation. Such resets are often designed to enhance the asset’s economic properties and price stability.
Context ∞ News extensively covers structural supply resets, especially events like Bitcoin halvings, as they are considered major catalysts for price appreciation. These resets often lead to a re-evaluation of the asset’s long-term price potential by market participants. Understanding these events provides critical context for interpreting supply-side economics and their influence on digital asset markets.
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