What Is a Cryptocurrency Futures Contract and How Is It Used for Hedging?
A crypto futures contract is an agreement to buy or sell a specific amount of cryptocurrency at a predetermined price on a future date. A miner uses it for hedging by selling a futures contract for the amount of crypto they expect to mine.
This locks in a selling price today, protecting their future revenue from a potential drop in the cryptocurrency's market price. This converts volatile crypto revenue into a predictable fiat equivalent.