Information half-life
How quickly the informational advantage of an event decays as more participants learn and act on it. Fast-decay headlines can become stale within minutes; structural changes can matter for days or longer.
Trader Glossary
Terms that make event-driven crypto analysis sharper
A compact vocabulary for thinking about market reactions instead of merely labelling headlines bullish or bearish.Forced actor
A participant that must change behaviour because a constraint changed: rebalance, repay, migrate, pause, hedge, unlock or alter infrastructure.
Execution lag
The gap between an announcement and the moment the change actually becomes active, settled, executable or irreversible.
Confirmation lag
The time between the first report and independent evidence that the underlying event is real and materially unchanged.
First-order effect
The direct consequence of an event, such as withdrawals pausing or a parameter changing.
Second-order effect
The next consequence caused by participant adaptation: liquidity migration, hedge unwinds, collateral changes or altered market-maker behaviour.
Liquidity fragmentation
A state where usable liquidity becomes uneven across venues or instruments, often widening spreads and creating temporary price dislocations.
Reflexivity
A feedback loop where price changes participant behaviour, and that behaviour then reinforces or reverses the price move.
Narrative-price divergence
A mismatch between the emotional direction of headlines and the actual price response. It can reveal that positioning or liquidity matters more than the story.
Crowded positioning
A situation where many participants are leaning the same way, increasing the chance that even expected news produces an unwind rather than continuation.
Basis / funding divergence
A disagreement between spot price, perpetual funding or futures basis that can expose leverage, hedging pressure or venue-specific stress.
Event invalidation
Observable evidence that breaks the original event thesis rather than merely producing short-term adverse price movement.
Event decay
The process by which an event loses marginal impact as it is absorbed, repeated, resolved or replaced by newer information.
Sell the news
A reaction where a positive event is followed by selling because expectations were built beforehand and the event becomes an exit point for pre-positioned participants.
How to use this material
Use these frameworks to improve event analysis, not as automatic long/short instructions. Direction still depends on positioning, liquidity, timeframe and the evidence available at that moment.