Definition ∞ Working capital represents the difference between a company’s current assets and its current liabilities. It indicates the short-term liquidity of a business and its ability to cover immediate operational expenses. Positive working capital suggests a healthy financial position, allowing a company to fund its day-to-day operations. Effective management of working capital is essential for maintaining operational solvency.
Context ∞ In the digital asset sector, managing working capital is particularly complex due to the volatility of cryptocurrency prices and the need for immediate liquidity. Companies often hold a portion of their working capital in stablecoins to mitigate price risk while ensuring operational flexibility. Strategic decisions regarding working capital deployment are critical for navigating market fluctuations and sustaining business activities.
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