The Hyperliquid Stablecoin Is Now Live, After Fierce Governance Battle

Hyperliquid stablecoin USDH launched this week, with $2M in early trades. Here’s how this token reduces reliance on external stablecoins.

Hyperliquid stablecoin USDH entered the market on Wednesday and quickly generated more than $2 million in trading activity

The launch gives Hyperliquid its first dollar-pegged asset and marks an important step in reducing reliance on external stablecoins such as Circle’s USDC.

Hyperliquid stablecoin USDH backed by cash and Treasuries

Hyperliquid stablecoin USDH is issued natively on HyperEVM, the exchange’s Ethereum-compatible execution layer. According to its proposal, USDH is backed by cash and short-term U.S. Treasury securities. Reserves will be managed through Stripe’s Bridge tokenisation platform.

The design allows Hyperliquid to keep yield within its ecosystem instead of passing it to external issuers. The protocol will split income from reserves evenly, using half to fund HYPE token buybacks and the other half to drive ecosystem development.

Governance vote hands issuance to Native Markets.

The right to issue Hyperliquid stablecoin USDH was decided through a governance vote earlier this month

Native Markets, a new crypto startup backed by Hyperliquid investor Max Fiege, alongside former Uniswap Labs president Mary-Catherine Lader and blockchain researcher Anish Agnihotri, won the process with more than two-thirds of validator support.

The bidding attracted proposals from well-known players including Paxos, Frax Finance, Agora, Curve, OpenEden, Bitgo and Ethena. Ethena later withdrew and endorsed Native Markets.

Some industry voices questioned how the process unfolded, though

Despite the criticism, Native Markets secured the win and now has responsibility for managing billions in flows through USDH.

Hyperliquid stablecoin USDH launch follows sharp market shifts

Hyperliquid is one of the most active decentralised derivatives exchanges in the world. At its peak earlier this year, it controlled around 70% of global on-chain perpetuals trading

That share has since dropped to about 35%, as new rivals like Aster gain traction.

In July, Hyperliquid processed $330 billion in volume with a team of only 11 members. However, competition now appears to have intensified.

How USDH could reshape Hyperliquid’s ecosystem

By introducing a stablecoin tied directly to its own network, Hyperliquid has now gained tighter control over liquidity and reserve income. The move reduces reliance on Circle’s USDC, which has represented more than 90% of platform deposits.

For users, USDH provides a stable asset that circulates within Hyperliquid, while supporting yield generation that benefits both HYPE holders and its developers.

Outlook for Hyperliquid stablecoin USDH

The arrival of USDH is a big deal for Hyperliquid. It allows the platform to internalise its stablecoin activity, build deeper liquidity and support long-term growth.

However, the launch comes at a time of rising competition and questions around governance practices

How Hyperliquid addresses these issues will determine whether USDH becomes a strong part of the market’s defi systems or struggles to gain traction.