Luxor Offers Hedged Hash to Miners

This is a fictitious term that refers to the price of a hash, which consists of the mining difficulty, the cost of electricity, and the current price of Bitcoin.

Miners will issue so-called Hashprice non-deliverable forwards (NDFs) to capture the value of the true farm hash rate. In this case, the contract guarantees the profitability of the business one month in advance. Additionally, miners will earn additional profits if the price rises when the futures expire. It makes up for the loss caused by the increase in mining costs.

From an investor’s perspective, buying NDFs can give you a premium return during a bull market. Miners’ profits are usually higher than Bitcoin’s percentage growth. The contract can also generate revenue when BTC depreciates.

NDF saves you from having to spend money on equipment investments like other companies like Grayscale offer. In such products, investors take the risk that ASIC miner costs will drop significantly when new equipment is released that will boost the hash rate to an all-time high.

Source of information: compiled from CRYPTOR by 0x information.The copyright belongs to the author Иван Петров, and may not be reproduced without permission

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