Would you trade hashrate futures?
Conversation
is there some sort of hedging reason behind why any miner would use this or is it just pure speculation?
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Yup! Miners could use this to hedge their exposure to difficulty changes.
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Surely instrument like this one is needed for miners at least for partial mitigation of risks. Question - will be if there is enough genuine liquidity for it to be instrument for miners and not just speculative BTC proxy.
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Yeah it's a good question--I think we'd only launch it if we had enough interest/liquidity for it
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don't you think that miners will be incentivized to manipulate the hashrate by shutting down or turning on ASICS according to the derivative position that they are holding?
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I think it prob wouldn't be economical.
If they shut off 1% for 2 weeks that would cost them about $1m. They'd need a $100m position with no impact to break even.
To shut for 2 week you have to own the energy supplier or have exceptional terms that allows miners just to surrender hundreds MW/h usage without occuring fines. Don't think there are many industrial scale miners that can do it easily...
Hey guys, we in general love this idea bc it gives the space the ability to buy hashpower while serving the mining company economically in an expedited manner. Further, the trade opps here are enticing if you consider the economics to hedge long hashpower contracts. Let’s build!
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I mean they could just point to another SHA256d coin in this case, take a hit on near dated profitability (SV / ABC aren't too far behind in terms of expected profitability right now) but wouldn't be a complete loss
But yeah, your point still stands it's not ideal.