The bitcoin block reward will be cut in half next year – and soon, market watchers can place bets on exactly when the subsidy halving will happen.

According to one estimated date, the halving will occur in late May 2020, but the precise time could shift slightly depending on the pace of blocks on the network and factors such as variance and miner luck. While not exact at this point in time, LedgerX is giving those who analyze the network a means to bet on when the halving will occur.

In a blog post announcing the new product, LedgerX contended that such an offering presents a particularly effective hedging instrument for bitcoin miners, explaining:

“Bitcoin is unique in that there is a fundamental economic risk that is binary. To give an analogy, imagine you are an oil producer such as Exxon Mobile and know that one day in 2020, the number of barrels of oil you extract will go down by half, forever. But you’re not certain which date that will be. This would materially impact planning for investment and operations.”

For those unfamiliar with this particular nuance of the bitcoin network, each block receives a reward in bitcoin to the miner who successfully creates it. The reward began at 50 BTC per block, and that reward cuts in half every 210,000 blocks. With two prior halvings, the reward is currently 12.5 BTC per block, and is set to fall to just 6.25 BTC per block.

The central question posed by LedgerX’s new product is this: when will block number 630,000 be forever stamped onto the blockchain?

Through the firm, participants can buy contracts that set a specific time that the halving will occur. If it happens after that time, they won’t pay out.

To begin with, LedgerX will offer five different contracts, ranging from March 27 (the riskiest, so it should have the lowest price) to July 31 (the safest, so it should have the highest). The date the contracts will begin selling and trading remains to be determined, but LedgerX expects it will be this quarter.

Opening day will be determined by client interest, and more dates could be offered for more precise bets depending on market interest. LedgerX will make a small fee on each contract, the price of which remains to be determined.

Any of LedgerX’s institutional clients will be able to participate in these contracts, but CEO Paul Chou argues that the offering provides a larger service to the industry than just another way to put money on the line.

“Even if you do not trade the contract directly, we are offering the prices the market has for free to everyone,” he told CoinDesk in an email.

Effectively, the contracts crowdsource information about when the halving will occur, giving market participants with information an incentive to share that indirectly in the form of bets that will move market prices. Anyone can see the market consensus date for the halving in real-time.

“It’s similar to other commodity markets where, when you are planning on how many people, resources and infrastructure you want for the next year, you can view derivatives markets to see how profitable people are expecting it to be,” Chou wrote.

Mining is a narrow-margin business, and the halving will undoubtedly cause any number of operations to shut down. The day it occurs “makes a huge impact,” Chou wrote us in an email. “If someone got really lucky and found a ton of blocks over the next two months a lot of miners would go out of business sooner than expected.”

If a miner’s decision to buy new equipment or take on a lease depended on just how long the current block reward might hold, a miner could hedge the risk of the tail end of that capital investment using these contracts, Chou explained.

Photo of Juthica Chou, COO of LedgerX, with BKCM CEO Brian Kelly, speaking at Consensus 2016 via CoinDesk archives