“The return comes from hashrate, not from pixie dust, ponzi schemes, or rehypothecation,” a Luxor Technology executive stressed.
An upcoming Bitcoin (BTC) hashrate-backed product that could offer 10% to 13% returns shouldn’t be compared to failed products by BlockFi or Celsius as its returns come from proof-of-work, not “ponzi schemes,” claims the product’s creator Bitcoin mining firm Luxor Technology.
The legitimacy of Luxor’s hashrate-backed product was highlighted in an Oct. 17 What Bitcoin Did podcast. Host Peter McCormack expressed concern at Luxor's upcoming offering and discussed what a worst-case-scenario for Luxor’s product would look like.
Luxor’s Head of Derivatives Matt Williams told Cointelegraph that its hashrate-backed product isn’t a repeat of products from BlockFi or Celsius because it's backed by economic production.
“There is actual proof-of-work and demonstrable economic activity happening [here].” Williams said. “The return comes from miners giving up some of the margin that they would produce from their mining business to an investor that is financing their operation.”
“The main takeaway: the return comes from hashrate, not from pixie dust, ponzi schemes, or rehypothecation.”
Luxor’s product works through investors receiving a cut of loan repayments by posting Bitcoin as collateral to Luxor — which will then loan it to other miners to fund their operations.
The returns are created when hashrate is purchased from a Bitcoin miner at a discounted price and is then “locked in” when sold at a higher price. Bitcoin in the form of mining rewards come from that hashrate. Luxor estimates investor returns will range from 10% to 13%.
The process will be managed through Luxor’s upcoming hashrate marketplace.
Williams claimed the offering means miner’s are provided with “better” access to capital because they won’t have to sell their mined BTC to fund their operations.
“It can be a more economically viable option for miners because they can receive funding upfront while retaining ownership of their mined Bitcoin,” he added.
Luxor stressed it isn’t using its own mining pool and is only acting as an intermediary between investors and mining firms. “We only custody bitcoin for a very short period of time as we move funds from the buyer (investor) to the seller (mining firm),” Williams sai.
We understand your concern regarding rehypothecation, but to be clear again, there is NO rehypothecation with this product. The yield comes from mining rewards as stated in the podcast.
— Luxor Technology ⛏️ (@LuxorTechnology) October 27, 2023
We're happy to have a conversation on this topic to answer your questions and address your…
But those interested in making a return on their Bitcoin should tread with caution, says Joe Kelly, CEO of Bitcoin lending firm Unchained.
Related: El Salvador launches first Bitcoin mining pool as Volcano Energy partners with Luxor
"Any investment or loan that requires a Bitcoin holder to part control with their Bitcoin should receive tremendous diligence and scrutiny,” he said.
“The bitcoin lending and borrowing markets are very nascent and we are likely to see repeats of the failures that happened with BlockFi and Celsius unless investors on the whole exercise extreme caution."
Williams stressed the hashrate-backed product isn’t available to everyone, only those who pass the firm’s due diligence checks.
TLDR: @LuxorTechnology intends to take customer Bitcoin and loan it to well established mining companies looking for funding.
— The ₿itcoin Therapist (@TheBTCTherapist) October 27, 2023
Luxor will do ‘due diligence’ on the recipient of the loan and the donor will immediately start receiving #Bitcoin at a pre determined rate (ie 10-13%)
Williams acknowledged Luxor's hashrate-backed product rightfully comes with “inherent trepidation” in light of the BlockFi and Celsius bankruptcies and noted that investors are taking on counterparty risk with Luxor.
To mitigate those risks, Luxor said it will only work with “reputable miners” and may even mandate them to post insurance.
Luxor did not share when the product will be available.
Magazine: Blockchain detectives: Mt. Gox collapse saw birth of Chainalysis
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marcushenderson624
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09.10.25 11:05
marcushenderson624
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09.10.25 11:05
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11.10.25 04:41
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11.10.25 10:44
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12.10.25 01:12
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12.10.25 21:36
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elizabethrush89
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robertalfred175
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14.10.25 08:46
robertalfred175
CRYPTO SCAM RECOVERY SUCCESSFUL – A TESTIMONIAL OF LOST PASSWORD TO YOUR DIGITAL WALLET BACK. My name is Robert Alfred, Am from Australia. I’m sharing my experience in the hope that it helps others who have been victims of crypto scams. A few months ago, I fell victim to a fraudulent crypto investment scheme linked to a broker company. I had invested heavily during a time when Bitcoin prices were rising, thinking it was a good opportunity. Unfortunately, I was scammed out of $120,000 AUD and the broker denied me access to my digital wallet and assets. It was a devastating experience that caused many sleepless nights. Crypto scams are increasingly common and often involve fake trading platforms, phishing attacks, and misleading investment opportunities. In my desperation, a friend from the crypto community recommended Capital Crypto Recovery Service, known for helping victims recover lost or stolen funds. After doing some research and reading multiple positive reviews, I reached out to Capital Crypto Recovery. I provided all the necessary information—wallet addresses, transaction history, and communication logs. Their expert team responded immediately and began investigating. Using advanced blockchain tracking techniques, they were able to trace the stolen Dogecoin, identify the scammer’s wallet, and coordinate with relevant authorities to freeze the funds before they could be moved. Incredibly, within 24 hours, Capital Crypto Recovery successfully recovered the majority of my stolen crypto assets. I was beyond relieved and truly grateful. Their professionalism, transparency, and constant communication throughout the process gave me hope during a very difficult time. If you’ve been a victim of a crypto scam, I highly recommend them with full confidence contacting: 📧 Email: [email protected] 📱 Telegram: @Capitalcryptorecover Contact: [email protected] 📞 Call/Text: +1 (336) 390-6684 🌐 Website: https://recovercapital.wixsite.com/capital-crypto-rec-1
14.10.25 08:46
robertalfred175
CRYPTO SCAM RECOVERY SUCCESSFUL – A TESTIMONIAL OF LOST PASSWORD TO YOUR DIGITAL WALLET BACK. My name is Robert Alfred, Am from Australia. I’m sharing my experience in the hope that it helps others who have been victims of crypto scams. A few months ago, I fell victim to a fraudulent crypto investment scheme linked to a broker company. I had invested heavily during a time when Bitcoin prices were rising, thinking it was a good opportunity. Unfortunately, I was scammed out of $120,000 AUD and the broker denied me access to my digital wallet and assets. It was a devastating experience that caused many sleepless nights. Crypto scams are increasingly common and often involve fake trading platforms, phishing attacks, and misleading investment opportunities. In my desperation, a friend from the crypto community recommended Capital Crypto Recovery Service, known for helping victims recover lost or stolen funds. After doing some research and reading multiple positive reviews, I reached out to Capital Crypto Recovery. I provided all the necessary information—wallet addresses, transaction history, and communication logs. Their expert team responded immediately and began investigating. Using advanced blockchain tracking techniques, they were able to trace the stolen Dogecoin, identify the scammer’s wallet, and coordinate with relevant authorities to freeze the funds before they could be moved. Incredibly, within 24 hours, Capital Crypto Recovery successfully recovered the majority of my stolen crypto assets. I was beyond relieved and truly grateful. Their professionalism, transparency, and constant communication throughout the process gave me hope during a very difficult time. If you’ve been a victim of a crypto scam, I highly recommend them with full confidence contacting: 📧 Email: [email protected] 📱 Telegram: @Capitalcryptorecover Contact: [email protected] 📞 Call/Text: +1 (336) 390-6684 🌐 Website: https://recovercapital.wixsite.com/capital-crypto-rec-1
15.10.25 18:07
crypto
Cryptocurrency's digital realm presents many opportunities, but it also conceals complex frauds. It is quite painful to lose your cryptocurrency to scam. You can feel harassed and lost as a result. If you have been the victim of a cryptocurrency scam, this guide explains what to do ASAP. Following these procedures will help you avoid further issues or get your money back. Communication with Marie ([email protected] and WhatsApp: +1 7127594675) can make all the difference.
15.10.25 21:52
harristhomas7376
"In the crypto world, this is great news I want to share. Last year, I fell victim to a scam disguised as a safe investment option. I have invested in crypto trading platforms for about 10yrs thinking I was ensuring myself a retirement income, only to find that all my assets were either frozen, I believed my assets were secure — until I discovered that my BTC funds had been frozen and withdrawals were impossible. It was a devastating moment when I realized I had been scammed, and I thought my Bitcoin was gone forever, Everything changed when a close friend recommended the Capital Crypto Recover Service. Their professionalism, expertise, and dedication enabled me to recover my lost Bitcoin funds back — more than €560.000 DEM to my BTC wallet. What once felt impossible became a reality thanks to their support. If you have lost Bitcoin through scams, hacking, failed withdrawals, or similar challenges, don’t lose hope. I strongly recommend Capital Crypto Recover Service to anyone seeking a reliable and effective solution for recovering any wallet assets. They have a proven track record of successful reputation in recovering lost password assets for their clients and can help you navigate the process of recovering your funds. Don’t let scammers get away with your hard-earned money – contact Email: [email protected] Phone CALL/Text Number: +1 (336) 390-6684 Contact: [email protected] Website: https://recovercapital.wixsite.com/capital-crypto-rec-1
15.10.25 21:52
harristhomas7376
"In the crypto world, this is great news I want to share. Last year, I fell victim to a scam disguised as a safe investment option. I have invested in crypto trading platforms for about 10yrs thinking I was ensuring myself a retirement income, only to find that all my assets were either frozen, I believed my assets were secure — until I discovered that my BTC funds had been frozen and withdrawals were impossible. It was a devastating moment when I realized I had been scammed, and I thought my Bitcoin was gone forever, Everything changed when a close friend recommended the Capital Crypto Recover Service. Their professionalism, expertise, and dedication enabled me to recover my lost Bitcoin funds back — more than €560.000 DEM to my BTC wallet. What once felt impossible became a reality thanks to their support. If you have lost Bitcoin through scams, hacking, failed withdrawals, or similar challenges, don’t lose hope. I strongly recommend Capital Crypto Recover Service to anyone seeking a reliable and effective solution for recovering any wallet assets. They have a proven track record of successful reputation in recovering lost password assets for their clients and can help you navigate the process of recovering your funds. Don’t let scammers get away with your hard-earned money – contact Email: [email protected] Phone CALL/Text Number: +1 (336) 390-6684 Contact: [email protected] Website: https://recovercapital.wixsite.com/capital-crypto-rec-1