How Do Futures Contracts on Mining Hardware Relate to the Long-Term Security of a PoW Network?

Futures contracts on mining hardware allow manufacturers and large mining operations to lock in future prices for hardware, providing predictability for capital expenditure. This financial tool encourages long-term investment in mining infrastructure.

By securing the future supply of hardware, these contracts contribute to the long-term stability and growth of the network's hashrate, which is the foundation of a Proof-of-Work network's security. This stability reduces the risk of sudden hashrate drops.