• Maelstrom has parked 5% of its funds in staked USDe, Hayes told CoinDesk in an email interview.

• The fund will rotate that money into crypto after the election results are clear and the losing side accepts the defeat, Hayes added.

• It doesn't matter who wins beyond the short-term, Hayes quipped.

With the U.S. election just a week away, markets are waiting with bated breath for the political event that has created "high uncertainty."

Arthur Hayes, chief investment officer at digital asset investment fund Maelstrom and co-founder of BitMEX, is hedging the election risk with Ethena Lab's USDe stablecoin while maintaining large bullish bets in bitcoin {{BTC}}, ether {{ETH}} and other cryptocurrencies.

"Given the uncertainty, Maelstrom has 5% of the fund in staked USDe (Ethena USD), earning roughly 13%. We maintain our large long positions in Bitcoin, Ether, and other tokens," Hayes told CoinDesk in an email.

Ethena's USDe is a synthetic dollar, which uses collateralized stablecoin and a hedged cash-and-carry arbitrage strategy to retail the $1 price peg. The funding fee collected from shorting perpetual futures tied to BTC and ETH as a part of the carry trade represents the yield. Staking USDe and acquiring staked USDe, or sUSDe, a reward-bearing token, automatically grants the user access to protocol rewards.

The fund's allocation in the delta-neutral product will guard against potential market price swings in the lead-up to the election on Nov. 5 and results, due three days later on Nov. 8.

Maelstrom is an investment fund focused on digital assets and managed by the family office of Arthur Hayes (co-founder, BitMEX). The fund’s mandate is to build a portfolio of infrastructure companies that will serve as the foundation of the next wave of trustless decentralization. In addition to managing the fund, Hayes writes the industry-leading monthly newsletter Crypto Trader Digest.

Watch out for a sore loser

Hayes expects risk assets, including cryptocurrencies, to see increased price turbulence for a while if the losing side takes to the street, causing social unrest.

According to traditional media, Republican Donald Trump and Democrat Kamala Harris are locked in a dead heat. Meanwhile, betting on decentralized prediction platforms has the supposedly pro-crypto Trump leading his rival Harris by a significant margin.

"If the election comes and goes with no social unrest, the markets will rip and roar. Post the election, once we know who wins, and the other side accepts the results, then we will deploy all sUSDe into crypto," Hayes said.