Hedging is a valuable practice. But my point was the old option modeling, Black-Scholes for example, doesn't work in Bitcoin markets: firstly because Bitcoin markets don't have the same structure or offer the same inputs as equities markets. And secondly because equity option theory doesn't even work in real world equities if we're being honest. Options do a decent job as rough short term guidelines for hedging and replication, in a few corners of the market that have gained enough efficient liquidity in options (such as large indexes and small number of single names) but hedging beyond there is an active challenge. One obvious sign maybe that option models don't work so well outside of their assumption-filled theory is how the options market makers still need so many humans involved in subjectively managing the risk on their books every day - if a theory and its models are strong and "tells you how to hedge" why can't computers calculate the next move and hedge risk with a click of a button automatically? Hedging in bitcoin would be questionable (if not laughable) right now, you can still do it of course and maybe shoddy guess hedging is better than nothing? But what's a fair price for bitcoin insurance over the next day, month, year?
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