The us cryptocurrency derivatives exchange LedgerX has introduced a fundamentally new type of derivative contract, the payment of which will depend on the time of the next Polovinnaya (halving) awards to miners in the bitcoin network.
Announcing the world’s first #Bitcoin derivative native. Read more on the @ledgerx blog: https://t.co/chqf0OOxgd
— LedgerX (@ledgerx) February 6, 2019
It’s a new product called LedgerX Halving Contract (LXHC) and is a binary option, the calculation has been performed on the base of the unit, which will be halving.
As explained in LedgerX, we are not talking about the evolution of the derived solutions, but rather about improvisation with some existing ideas, as swaps, options and futures — all of this is already familiar with the traditional financial world.
“This contract will allow you to obtain a fixed payoff if the next block of halving (#630,000) will be found before the due date and time. If the unit is found later, the contract value at the time of expiry will be zero”, — stated in the message of the new York company.
As you know, halving in the network of bitcoin occurs every four years, and following such an event, according to Bitcoin Block Reward Halving Countdown, should be may 25, 2020. It is, however, a rough estimate – the exact time of block #630,000, which will be halving, depends on a combination of factors such as Hasrat network and the complexity of mining. Previous halving, after which reward miners decreased from 25 BTC to 12.5 BTC the current held in 2016.
“Binary options traditionally associated with gambling. But the majority of the financial products behave in a similar way – share price, price of oil, the temperature of the weather, etc. Binary options tend to be based on right or wrong choice, won the team a super bowl or lost. Managers of wall Street often avoid binary options bitcoin is unique in that its fundamental risks are binary. For example, oil producer Exxon Mobile knows that one day, in 2020, the number of produced barrels of oil will be permanently reduced exactly twice. But you don’t know what day it will happen, although the event will significantly affect the investment process and trading operations. Bitcoin miners face this risk every four years, when the number of new bitcoins rewarded to miners for mining the new block is reduced by half”, — said in LedgerX.
In 2017 LedgerX become the first private company to receive official permission, the Commission on urgent exchange trade of the USA (CFTC) at the launch of the exchange and the clearing center to trade crypto options and derivatives.
In January of this year, the company launched the index LedgerX Volatility Index (LXVX), which tracks expected volatility of bitcoin.