> ## Documentation Index > Fetch the complete documentation index at: https://docs.mezzamine.com/llms.txt > Use this file to discover all available pages before exploring further. # Fleet Hedging > Mezzamine's proprietary hedging model: how the Fleet Hedge stabilizes fleet revenue in bear markets, removes margin calls, and allows ASICs to count as collateral. Mezzamine's proprietary hedging model stabilizes fleet revenue in bear markets. The Fleet Hedge is a delta-neutral position sized to the fleet's expected BTC production and executed at institutional derivatives desks. A falling BTC price hits a miner twice, compressing margins and cutting the resale value of the machines, and the hedge is built to gain value in exactly that decline. The model has two layers. The Fleet Hedge locks in revenue for the fleet. A separate options hedge protects lender principal and is described under [Prime Lending](/for-lenders/prime-lending/the-hedging-model). ## In a falling market When BTC price falls, fleet margins contract and loan payments are stressed, while Fleet Hedge short positions gain value and the hedge ensures loan payments can be made. Realized gains support debt service, so there is no margin call and no forced liquidation. When BTC price falls, fleet margins contract and loan payments are stressed, while Fleet Hedge short positions gain value and the hedge ensures loan payments can be made. Realized gains support debt service, so there is no margin call and no forced liquidation. As BTC declines toward the fleet's breakeven, the position is rebalanced and gains are realized. With lender approval those gains support the scheduled payment, so the operator is not forced to find BTC it did not mine, sell hardware into a falling market, or post additional collateral. In the reference simulation across 3,000 BTC price paths, the Fleet Hedge reduced modeled payment default frequency from approximately 44.5% to approximately 3.3%. ## In a rising market In a rising BTC market, mining margins widen, hedge exposure is actively reduced, and the operator keeps the upside on production. In a rising BTC market, mining margins widen, hedge exposure is actively reduced, and the operator keeps the upside on production. As BTC rises and margins widen, hedge exposure is reduced and the operator keeps the upside on production. ## What it means for the borrower * **No margin calls on a BTC decline.** The hedge absorbs the first impact of a falling price. * **Repayment holds through bear markets.** Realized hedge gains can cover scheduled payments when margins are thinnest. * **The fleet counts as collateral.** The hedge gains value in the same decline that compresses ASIC prices, which is what allows machines to be underwritten into the package and as low as 20% of principal in posted BTC. See [Collateral & Security](/for-miners/asic-financing/collateral-and-security). ## Hedge margin and profits Hedge margin is held separately from loan collateral and is not counted toward LTV. Hedge profits accrue to the lender during the program and, with lender approval, may support debt service. | Event | Treatment | | -------------- | ------------------------------------------------------------------------------------------------------------------- | | Full repayment | Remaining hedge margin and any realized or unrealized hedge profits are returned to the borrower | | Default | Hedge margin and realized hedge profits are liquidated and transferred to the lender as part of collateral recovery | Simulation figures reflect the stated reference assumptions and are modeling outputs rather than forecasts or a guarantee of performance.