As the U.S. election looms, crypto investors are bracing for potential turbulence that could jolt major tokens like Bitcoin and Solana. 10X Research, led by Markus Thielen, has pitched a strategic “pair trade” to help investors navigate this storm: go long on Bitcoin (BTC) and short on Solana (SOL). The approach is driven by recent trends in Solana’s network activity and potential shifts in the regulatory landscape post-election.
Why Short Solana?
Solana, despite its high-speed blockchain, has shown some red flags lately. Transaction fees on the network have halved, dropping from $5 million in late October to $2.5 million. For investors, this dip signals waning demand, which historically doesn’t bode well for token prices. It’s a bearish cue, and 10X Research sees this cooling off in fees as a reason to consider going short on SOL in the near term.
Election Outcomes Could Tip the Scales
The election’s impact on the crypto market could be significant. Thielen notes that if Kamala Harris wins, we might see less chance of U.S.-based ETFs tied to alternative assets like Solana getting approved. This could trigger a steep drop for SOL — potentially around 15%. Bitcoin, being a more established asset, might fare slightly better with a smaller 9% dip, according to Thielen.
Alternatively, if Trump secures the win, the outlook changes. A Trump administration is seen as crypto-friendly, and that optimism could boost SOL, BTC, and Ether (ETH) by around 5%. Bitcoin and Ether, which already have spot ETFs trading in the U.S., could get an extra lift from Trump’s regulatory stance. Solana, however, has no spot ETF yet, though major players like VanEck and 21Shares are eager for approval.
A Tactical Play as Election Day Nears
With the presidential race tighter than ever, this long BTC-short SOL pair trade might be a smart play to hedge against the unknown. The latest SOL-BTC trading ratio sits at 0.00235, underscoring the cautious sentiment among investors as Election Day draws near. Whether the market moves in favor of Bitcoin or Solana will largely depend on the White House’s future occupant and their stance on crypto regulation.
SOL Price Current Scenario
The Solana (SOL) price is currently facing uncertainty as it hovers around the $160 horizontal support area, which previously acted as resistance. While the weekly chart remains bullish, daily indicators are signaling bearish trends.
The MACD has crossed bearishly, and the RSI is at risk of falling below 50. If this occurs, SOL could decline to the ascending support trend line at $150.
Such a drop would indicate that the recent breakout above $160 was merely a deviation, suggesting that the overall increase might be corrective. Thus, while SOL has bounced at $160, a further decline to $150 is possible.
