In the most recent edition of Cointelegraph’s Market Talks, host Ray Salmond engaged in a conversation with Dan Rosen, the associate director of derivatives at Luxor. Luxor is a Bitcoin mining pool, research center, and service provider based in the United States. The discussion covered various topics, such as Rosen’s perspective on how the upcoming Bitcoin halving will impact the price of BTC, why Bitcoin’s volatility is expected to remain in the double-digits for several years, and how miners can protect their operations through hash rate derivatives.
Rosen explained that historically, miners had limited options for hedging risks within their operations, aside from pledging mined Bitcoin rewards. Luxor’s hash rate derivatives introduce a new infrastructure to this sector of the industry, enabling miners to hedge their exposure to changes in hash price. These derivatives provide miners with the opportunity to anticipate and secure future revenue during periods of unexpected volatility that can affect the efficiency of their operations.
In terms of the macroeconomic environment and its potential impact on Bitcoin’s price and miners, Rosen stated that the market is realizing that achieving the 2% inflation target rate is unlikely in the near future. Instead, the market seems to be pricing in a longer-term inflation rate of around 2.5% to 3%. Simultaneously, the US dollar is still considered a safe-haven asset, which is affecting equities and creating macroeconomic headwinds, ultimately resulting in a devaluation of dollar-denominated assets.
Despite the gloomy economic outlook, Rosen remains optimistic. To gain further insights, listeners are encouraged to tune in to the full episode of Market Talks on the new Cointelegraph Markets & Research YouTube channel. Don’t forget to show your support by liking and subscribing to stay up-to-date with the latest content.