10x Research Advises Shorting Ethereum While Holding Bitcoin

TLDR

• 10x Research suggests shorting Ethereum to hedge Bitcoin positions.
• Institutional interest in Bitcoin surges, reaching $50 billion in options.
• Ethereum faces pressure from declining sentiment and weak demand.

10x Research, under the guidance of founder Markus Thielen, has issued a pivotal trading recommendation. The firm suggests that investors hedge their long Bitcoin (BTC) positions by shorting Ethereum (ETH), citing a weak demand and capital for ETH. This stands in contrast to strong institutional buy-ins for Bitcoin.

This strategic move is significant for the crypto market, as it reflects a tactical bearish stance on ETH, while maintaining a bullish or neutral outlook on BTC. This recommendation is poised to impact not only ETH and BTC, but also the broader Layer 1 and Layer 2 altcoin sector.

Current Analysis from Market Experts

In a client note, Markus Thielen stated, “Our altcoin model continues to favor short ETH versus long BTC.” He elaborated that shorting Ethereum might serve as a useful hedge due to its weak digital asset treasury outlook.

Bitmine Immersion Technologies, a prominent buyer of ETH, has reportedly slowed its new share issuance since September. This action reduces the potential for ETH acquisition through this channel. Thielen pointed out, “With limited options to raise additional capital, Bitmine’s capacity to purchase more ETH is now constrained.”

Institutional Movements and Market Sentiment

The recommendation stems from a noticeable investor aversion to Ethereum, highlighted by the rise in ETH put options. Meanwhile, BTC options have seen a surge, reaching an open interest record of $50 billion, fueled by bullish BTC calls. This trend aligns with limited retail enthusiasm for ETH.

Furthermore, spot BTC ETFs have amassed $54.97 billion in 2025, spotlighting the substantial institutional focus on Bitcoin. Notably, VanEck forecasts Bitcoin reaching $180,000 by 2025, reflecting its growing appeal to large-scale investors.

Impact on Ethereum and Related Altcoins

Ethereum is directly affected by increased shorting pressure, a frail digital asset treasury, and declining sentiment. Simultaneously, BTC continues to benefit from strong ETF inflows and institutional interest.

Altcoins associated with Ethereum, particularly smaller Layer 1 and Layer 2 tokens, may face collateral impact due to the sector rotation and capital outflows from ETH-related DeFi projects.

Related Cryptocurrencies and Investment Strategies

Among the directly affected cryptocurrencies are Ethereum and Bitcoin. Indirectly, the focus extends to other altcoins like Solana and Avalanche, and L2 rollups such as Arbitrum and Optimism. Additionally, DeFi assets like Aave and Uniswap governance tokens might follow Ethereum’s lead.

As for strategy, Thielen’s stance appears to lean towards reducing exposure to Ethereum, aligning investments with the current institutional preference for Bitcoin. The recommendation emphasizes a strategic tethering to Bitcoin’s institutional momentum, potentially safeguarding assets amidst Ethereum’s current volatility.