Luxor Technologies, a bitcoin mining software and services company, has announced the expansion of bitcoin mining derivatives contracts. According to a press release sent to Bitcoin Magazine, the new offering from Luxor Derivatives Office It includes six-month contracts and daily settlement rates, providing market participants with extended contract periods and quick access to liquidity. The press release stated that the addition of these features enhances hedging efficiency and reduces the cost of capital in the Bitcoin mining derivatives space.
Matt Williams, Head of Derivatives at Luxor, expressed his enthusiasm for the innovative pricing model, saying, “This innovative pricing model takes Hashprice contracts to the next level.” He emphasized that the integration of daily settlement rates makes their offerings more attractive to traditional finance investors, broadening the Luxor Hashprice market beyond the mining sector. “This development confirms Luxor’s vision of transforming retail into a viable asset class,” added Williams.
The press release described how as more participants join the Luxor Derivatives desk, increased liquidity is expected to improve the cost of capital for miners. This update comes at an opportune time, as miners approach the 2024 Bitcoin halving, which will lead to a 50% drop in the value of BTC for block subsidies. The shorter six-month Hashprice contracts can help miners plan long-term hedging strategies to weather impending volatility.
Luxor CEO and co-founder Nick Hansen applauded the upgrade, emphasizing the company’s commitment to financial innovation in the bitcoin mining sector. He described this as progress on their vision of hash as an asset class and expressed his excitement about bringing this forward-looking product to their broad client base that already uses Hashprice contracts.
Hashprice contracts are traded on the OTC derivatives marketplace of Luxor, enabling sellers to secure bitcoin mining revenues and buyers to access intangible bitcoin mining exposure. The Luxor Derivatives Desk facilitates order matching, counterparty risk management and payment settlement using the Bitcoin Hashprice Index as the reference rate for projected mining revenue.