Hyperliquid's revolutionary stablecoin reclaiming $220M in lost Treasury yields for DeFi dominance. Dive into validator battles, RWA backing, and ecosystem perks that redefine crypto stability.
Hyperliquid has launched USDH, its proprietary USD-pegged stablecoin.
The platform currently manages around $4.75 billion in TVL, with $4.56 billion in USDC deposits, but continues to lose an estimated $182 million annually in Treasury yield to Circle.
USDH is designed to reclaim this value for the Hyperliquid ecosystem, following a validator vote on September 14, 2025, where Native Markets emerged as the winner.
USDH is Hyperliquid's native stablecoin engineered to hold a 1:1 peg with the US dollar. Unlike Circle's USDC or Tether's USDT, USDH is customized for Hyperliquid's Layer-1 blockchain, functioning across HyperCore (for trading) and HyperEVM (for smart contracts).
The stablecoin resolves a major challenge: Hyperliquid users deposit billions in USDC, but Circle captures the Treasury yield from those reserves.
With about 96% of the platform's stablecoin deposits in USDC (representing roughly 6% of USDC's total supply), this causes notable value outflow from the ecosystem. USDH does not enjoy special privileges but acts as a key settlement asset with reduced trading fees.
The Hyperliquid Foundation designated the USDH ticker for a "Hyperliquid-focused, Hyperliquid-supportive, and compliant USD stablecoin."
USDH sustains its dollar peg through full collateralization with low-risk assets. Issued by Native Markets, it features:
Hyperliquid unveiled the USDH project on September 5, 2025, via Discord, setting up a novel auction for stablecoin issuance rights. The process proceeded as follows:
The Hyperliquid Foundation stayed neutral by abstaining from the vote. Native Markets led early with strong validator support.
Instead of forfeiting around $182 million yearly to outside issuers, USDH retains Treasury yields within Hyperliquid. At current deposit levels and 4% APR, this provides meaningful value to HYPE holders via buybacks that shrink token supply.
USDH integrates effortlessly with Hyperliquid's 100,000 orders-per-second system, eliminating issues with external stablecoins. This is essential for high-frequency traders needing sub-second settlements.
Users can access USDH through various methods:
All stablecoins risk depegging in extreme markets.
Mitigation strategies include:
USDH continues to build liquidity to support Hyperliquid's high volumes. Current supply stands at approximately $24 million, with 99.5% uptime and minimal peg deviation.
The GENIUS Act (signed July 2025) and EU's MiCA set high standards. Native Markets emphasizes ongoing compliance, adapting to evolving regulations.
USDH's growth ties to Hyperliquid's 70% DeFi perpetuals market share. Any platform disruptions could influence the stablecoin's adoption.
Current status:
Total stablecoin market cap exceeds $285 billion. Hyperliquid's $4.56B USDC represents about 6% of Circle's supply, positioning USDH as a growing competitor. Platform-specific stablecoins continue to gain momentum post-GENIUS Act.
The implementation includes:
USDH enhances Hyperliquid's economics by redirecting Treasury yields from external issuers back to the ecosystem.
Native Markets, having won the September 14 validator vote with ~70% support, built and launched this infrastructure on September 25, 2025.
For users, USDH offers 80% lower trading fees, direct value through HYPE buybacks, and seamless integration.
Success depends on increasing adoption beyond the current $24M supply and Hyperliquid maintaining its DeFi perpetuals dominance. With $4.75B in TVL and 100,000 orders per second, Hyperliquid has the scale to elevate USDH in the stablecoin market.
Read Next:
The implementation retains some centralized elements for regulatory compliance and reserve management, blending DeFi-native aspects with licensed operations.
The issuer guarantees 1:1 USD redemption as a price floor. Arbitrage and market makers maintain the peg under normal conditions.
Yes, with some limits. It includes cross-chain plans but is designed as Hyperliquid-first, with primary utility on the platform.
Regular third-party audits cover smart contracts and reserves. The issuer undergoes routine checks for operations.
Basic mint/redeem operations have minimal or zero fees. Trading fees are 80% lower than other stablecoin pairs, with details set by the issuer.
