Estoppel is a rule about consistency: once a person's conduct has led another to rely on a fact, the law prevents them from going back on it.
Since only the first description matches the statutory rule, the correct answer is Stopped from asserting or denying a fact.
Estoppel is best understood through the fairness problem it solves: someone relies to their detriment on another's representation, and it would be unjust to let that representation later be denied.
The fairness rationale behind estoppel points squarely to barring inconsistent assertions or denials of fact.
Therefore, the correct answer is Stopped from asserting or denying a fact.