Luxor's Dan Rosen Discusses Bitcoin Volatility, Halving, and Miners' Hedging Strategies
Summary:
Dan Rosen, associate director of derivatives at Luxor, discusses Bitcoin's volatility, the upcoming halving, and miners' ability to hedge their operations using hash rate derivatives. He predicts a decrease in volatility as Bitcoin becomes more investable, and believes that macro factors may lead to new lows in the next six months followed by a stronger rally. Listen to the full episode on Cointelegraph's YouTube channel.
Dan Rosen, associate director of derivatives at Luxor, a US-based Bitcoin mining pool, research hub, and service provider, discussed various aspects of the cryptocurrency market on the latest episode of Cointelegraph's "Market Talks" with host Ray Salmond. The conversation covered topics such as the impact of the upcoming Bitcoin halving on BTC price, the persistent volatility of Bitcoin, and miners' ability to hedge their operations using hash rate derivatives. Rosen noted that Bitcoin's volatility is decreasing over time as the asset becomes more investable, but it is expected to remain in the double-digits for several years. He compared Bitcoin's volatility to that of tech stocks like Apple and Google in the early 90s, stating that eventually, Bitcoin could become a less volatile asset class with annualized volatility of 20% or below. Luxor's hash rate derivatives offer miners a way to hedge their exposure to changes in hash price, enabling them to predict and lock in future revenue during periods of unexpected volatility. Rosen also commented on the macro factors influencing Bitcoin's price and miners. He mentioned that the market is pricing in a longer-term inflation rate of around 2.5% to 3% and that the US dollar's status as a safe haven asset is impacting equities and leading to a depreciated value of dollar-denominated assets. Despite the current economic outlook, Rosen expressed optimism that although Bitcoin's price may not reach six figures before or immediately after the halving, there could be a period of new lows in the next six months due to macro headwinds, followed by a stronger rally. To listen to the full episode of "Market Talks," visit the new Cointelegraph Markets & Research YouTube channel.
Published At
8/24/2023 5:30:00 PM
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