Part 7/16:
Matt introduces Luxor’s innovative derivatives platform, designed to provide miners with revenue hedging tools directly tied to hash rate and network metrics. These instruments, such as hash price forwards, allow miners to lock in future revenue in a way that reduces exposure to Bitcoin price volatility, difficulty swings, and transaction fee variability.
He explains how the backwardation seen in current hash rate futures indicates market expectations of declining hash rates due to upcoming challenges. By locking in hash price at favorable levels through OTC markets, miners can mitigate risks and ensure more predictable cash flows. The platform supports both USD and Bitcoin-denominated contracts, offering flexible risk management solutions.