Value Preservation

Definition ∞ Value preservation refers to strategies and mechanisms designed to maintain the purchasing power or intrinsic worth of an asset over time. In digital assets, this can involve selecting assets with low volatility, employing hedging techniques, or utilizing stablecoins. The objective is to protect capital from erosion due to inflation or market fluctuations.
Context ∞ The concept of value preservation is increasingly relevant in the volatile digital asset market. Investors and institutions are actively seeking methods to protect their capital, leading to discussions about asset allocation, the role of stablecoins, and the development of DeFi strategies focused on capital protection. News coverage often examines how different digital assets and financial instruments perform in preserving value during periods of market stress.