As the U.S. presidential election nears, markets are bracing for significant price swings that could challenge directional traders. To navigate this volatility, 10x Research is suggesting a strategic pair trade involving Bitcoin (BTC) and Solana (SOL) tokens.
Markus Thielen, founder of 10x Research, recommended a tactical bet that involves going long on Bitcoin while shorting Solana. In a note to clients on Monday, Thielen explained that the election’s outcome could significantly impact the digital asset market, including the potential approval of U.S.-based exchange-traded funds (ETFs) linked to alternative cryptocurrencies like Solana.
“If Kamala Harris wins, the chances of these ETFs being approved could decrease, potentially causing Solana to drop by as much as 15%, while Bitcoin might see a more modest decline of around 9%,” Thielen said. He also pointed out that a Trump victory could result in price increases of around 5% for SOL, BTC, and Ethereum (ETH).
Bitcoin and Ethereum might see greater gains than Solana in the event of a Trump win. Both have spot ETFs already trading in the U.S. and have attracted billions of dollars in investments this year, with the market likely anticipating favorable regulatory policies under a Trump administration. In contrast, Solana has yet to launch its first spot ETF, although companies like VanEck, 21Shares, and Canary Capital have already filed for SOL ETFs with the U.S. SEC.
In addition to election-driven volatility, Thielen noted that Solana’s network has seen a decline in daily transaction fees, which recently fell to $2.5 million, down from a high of $5 million on October 24. Historically, such drops in transaction activity have weighed negatively on Solana’s price.
As of writing, the SOL/BTC ratio was trading at 0.00235 on Binance, according to TradingView data. With the presidential race tight, Thielen’s strategy suggests that Bitcoin could outperform Solana in the near term, depending on the election’s outcome.
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