Definition ∞ A supply shortage in digital asset markets occurs when the available amount of a cryptocurrency for sale cannot meet current demand. This imbalance typically leads to upward pressure on the asset’s price as buyers compete for limited units. Such shortages can result from increased investor holding, token burning mechanisms, or assets locked in staking and decentralized finance protocols. It signals strong underlying demand relative to available supply.
Context ∞ The current market frequently experiences localized supply shortages for certain digital assets, driven by increasing institutional interest and long-term holder accumulation. Discussions often focus on how these supply constraints might influence future price appreciation. Future market dynamics will largely depend on whether these shortages persist or if new supply enters the market to meet demand.
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