On September 5th, the Hyperliquid team officially announced the upcoming auction for the "USDH" ticker. This is the native stablecoin designed for the Hyperliquid ecosystem. Currently, various institutions such as Paxos, Ethena, Frax, Agora, Native Markets, and others have submitted proposals, vying for the right to issue USDH.

The list of candidates for this election includes both traditional compliance institutions and emerging DeFi projects. The intense competition is driven by the rapid rise of Hyperliquid as a new decentralized trading platform: its perpetual contract monthly trading volume is approaching $400 billion, with an August monthly fee income of up to $106 million, capturing about 70% of the decentralized perpetual market share. The native token of Hyperliquid, HYPE, also recently hit an all-time high. Related reading: "USDH Battle Begins, Everyone Envious of Stablecoin+Hyperliquid Concept"

Currently, the on-chain dollar liquidity of Hyperliquid mainly relies on external stablecoins like USDC, with a circulation scale reaching $5.7 billion at one point, accounting for approximately 7.8% of the total USDC issuance. If USDH is successfully launched, it means that potentially hundreds of millions of dollars in interest income could directly benefit the community annually. Therefore, who wins the right to issue USDH not only affects market share but also determines the dominance over this substantial potential revenue. The final stablecoin issuance ownership will be revealed in the on-chain vote from 10:00 to 11:00 (UTC) on September 14th. Whose hand will the deer fall into after the immortals' fight? BlockBeats will continue to follow up and provide real-time updates:

September 12th

Ethena Labs Withdraws from USDH Stablecoin Issuance Bid

On September 12th, Ethena Labs founder Guy Young posted on social media that, through direct communication with community members and validators, Ethena Labs has thoroughly considered some key issues, namely:

· Ethena is not part of the Hyperliquid core team

· Besides USDH, Ethena has other product lines

· Ethena's vision is not limited to collaboration with a single trading platform

Given the current situation has become clearer, Ethena Labs will respectfully withdraw the proposal to allow validator nodes to freely support other proposals.

September 11

Native Markets Receives 71.88% Staked Support in USDH Auction

On September 11, according to usdhtracker data, Native Markets has received 53.4% staked support in the USDH auction. When including the latest endorsement from the largest validating node, "Nansen x HypurrCollective," it has now received a total of 71.88% staked support.

Hyperliquid's Largest Validating Node Announces Support for Native Markets in USDH Auction

On September 11, Hyperliquid's largest validating node, Nansen x HypurrCollective, posted on the X platform stating their support for Native Markets in the USDH auction. The announcement mentioned that this decision was collectively made by ecosystem participants, stakers, and the community. "While each proposal presented strong ideas, the community sentiment collection results were very close, reflecting intense competition throughout the process. In the end, Native Markets slightly edged out, with its vision being seen as most aligned with Hyperliquid's long-term success."

Native Market's Win Probability in HyperLiquid's USDH Auction Prediction Rises to 93%

On September 11, according to the Polymarket page, in Hyperliquid's USDH stablecoin auction, Native Market's win probability has risen to 93%, while Paxos's win probability has fallen to 6%, ranking second.

September 10

Paxos's Win Probability in HyperLiquid's USDH Auction Prediction Rises to 44%

On September 10, according to the Polymarket page, in Hyperliquid's USDH stablecoin auction battle, Native Markets' win probability decreased to 52%, Paxos's win probability rose to 42%, ranking second, and Ethena ranking third with an 8% win probability.

Dragonfly Partner Haseeb Claims Native Markets Favorited by Validators in USDH Bid, Multiple Node Operators Refute

On September 10, Dragonfly partner Haseeb stated in a post, "I've heard multiple bidders say that validators have shown no interest in considering any other bidders except for Native Markets. Native Markets' proposal was posted almost immediately after the USDH RFP was announced, indicating they received early notice. Others were busy putting together proposals over the weekend. So, the entire USDH RFP was essentially tailor-made for Native Markets." In response to this statement, Galaxy, operator of the Hyperliquid validator, and Nansen CEO both posted refutations, stating, "The validator operations team has put in a lot of effort to review proposals and communicate with bidders."

Hyperliquid: USDH Bidding Proposal Submission Deadline Today at 18:00, Validator Voting to Commence on the 14th at 18:00

On September 10, the Hyperliquid team announced that teams bidding for USDH must submit proposals by 10:00 UTC on September 10; validators will publicly vote on the targets by 10:00 UTC on September 11. Users can delegate their stake to a validator aligned with their intentions before 10:00 UTC on September 14, when validator voting begins. Voting weight is calculated based on the stake amount, and the foundation will effectively abstain.

Native Markets Leading in Hyperliquid Stablecoin USDH Bidding Prediction, with Paxos at Only 15%

On September 10, according to the Polymarket page, in the Hyperliquid stablecoin USDH bidding war, Native Markets currently has a winning probability of 74%, leading various third-party bidders. Paxos ranks second with a 15% chance of winning, and Ethena ranks third with a 12% chance of winning.

Paxos Updates USDH Proposal v2, Will Collaborate with PayPal, and Receives $20 Million PayPal Ecosystem Incentive

On September 10, stablecoin issuer Paxos updated the USDH proposal to version 2, which provides three upgrades:

· Partnered with PayPal, HYPE is live on PayPal/Venmo (subject to regulatory approval) and offers free USDH deposits and withdrawals, a $20 million ecosystem incentive, as well as global payment integrations between Checkout, Braintree, Venmo, Hyperwallet, and Xoom;

· Clear AF-first incentive structure, where Paxos only earns rewards once reaching a TVL milestone, capped at 5%, and all fees are collected in HYPE tokens;

· Paxos can issue stablecoins legally in Europe, ensuring USDH can expand globally in a fully compliant manner.

Ethena Labs Releases Bid for USDH Issuance Rights Proposal

On September 10, according to official sources, Ethena Labs joined the Hyperliquid-backed USDH stablecoin issuance rights competition by releasing a bid for the USDH issuance rights proposal. Ethena Labs stated that if selected as the USDH issuer, USDH will be 100% backed by USDtb, issued by Anchorage Digital Bank, and fully collateralized by BlackRock BUIDL. Ethena commits to returning at least 95% of the net income generated by the USDH reserve back to the Hyperliquid community through HYPE buybacks, reward funds, and other means. Ethena will cover the USDC migration costs and plans to introduce a liquidity support mechanism to enhance USDH's perpetual contract market depth.

Ethena has reserved at least $75 million (comprised of cash and token incentives) to support the HIP-3 frontend development for Ethena-related products (including USDe, hUSDe, and USDH), contingent on the proposal's approval. 50% of the frontend-generated fee revenue will be shared with Hyperliquid.

September 9

Sky Joins Hyperliquid-Backed USDH Stablecoin Issuance Rights Competition

On September 9, Sky (formerly MakerDAO) joined the Hyperliquid-backed USDH stablecoin issuance rights competition. Sky co-founder Rune stated on the X platform: "Sky offers the primary advantages for USDH on Hyperliquid:

· USDH will receive $2.2 billion USD in instant USDC liquidity for off-chain redemption;

· Sky can deploy over $8 billion in assets under Hyperliquid's balance sheet;

· All USDH on Hyperliquid will earn a yield of 4.85%, higher than the national bond yield, and all USDH-generated 4.85% yield will be used for the HYPE buyback fund;

· Sky can provide $25 million in funding to create an independent Hyperliquid Star project, autonomously developing Hyperliquid DeFi;

· Sky can move its buyback system to Hyperliquid, leveraging over $250 million in annual profits to build USDH liquidity."

Hyperliquid Hosts "USDH Stablecoin Roundtable Meeting" with Representatives from Paxos, Frax, Native Markets, Bridge, Bastion Platform, and Sky

On the evening of September 9, Hyperliquid hosted the "USDH Stablecoin Roundtable Meeting" at X Space, inviting representatives from projects such as Paxos, Frax, Native Markets, Bridge, Bastion Platform, and Sky to discuss proposals, compliance, and ecosystem integration of the USDH stablecoin.

Sky Co-Founder Rune stated that Sky's approach to USDH for the Hyperliquid community is to initially launch a fully decentralized stablecoin. A decentralized stablecoin design inherently includes many protective mechanisms that can prevent issues such as corruption or incompetence that a centralized issuer may face, providing users with out-of-the-box protection. However, it is evident that regulatory approval is still required, along with additional clarity, which is very beneficial for compliance with regulatory frameworks. Sky will let the community decide how to strike a balance between decentralization and compliance. It is entirely possible to make necessary adjustments on highly decentralized infrastructure to meet regulatory requirements.

Paxos Labs Co-Founder stated that Paxos Labs is very well-suited to collaborate with the Hyperliquid ecosystem. Paxos Labs has a team dedicated to Hyperliquid and has been developing on Hyperliquid since day one. At the same time, Paxos is one of the longest-standing compliant stablecoin issuers in the industry, holding a New York State Department of Financial Services-issued trust charter and being the only institution with a federally chartered license from the OCC (Office of the Comptroller of the Currency). We believe USDH will become an asset worth over $10 billion, and possibly even larger. Only entities regulated by the federal government can issue assets worth over $10 billion, a qualification not easily obtained, and a significant highlight for Paxos Labs. If a compliant global stablecoin is essential to the community, Paxos is the only provider in the industry capable of doing so.

Frax Head of Growth Sean Kelley stated that regarding the question of "whether to allocate funds from revenue to buyback," he believes the specific allocation ratio should be decided by the community, and Frax absolutely wants to address the issue through governance. This may require finding a balance in the following areas: allocating some funds to buyback to support further growth of USDH and improving other areas of the ecosystem considered weaker. The specific percentage should ultimately be determined by the community. As for the transparency of revenue distribution, Frax places great emphasis on data visualization, hoping to ensure that fund flows can be transparently tracked, and will publish data on a dashboard for user access, essentially tracking everything on-chain in the ecosystem. Regarding buyback allocation, Frax believes that conducting one quarterly may be reasonable, and all operations will be executed through smart contracts.

Bastion Platform Co-founder Nass Eddequiouaq expressed willingness to incentivize the migration of liquidity amounting to hundreds of billions of dollars from USDC on Hyperliquid to USDH through a cost subsidy. Bastion Platform believes the most critical core element is to build a strong flywheel effect: continually driving the conversion of USDC to USDH through incentivization mechanisms and ensuring that all new markets built on USDH use USDH natively rather than USDC. We should migrate the existing ecosystem to this inclusive financial system that benefits the entire community, and all new ecosystems should no longer be burdened by the legacy monetary system but must be natively built on USDH.

Hyperion Community Leader Max stated that building a stablecoin system first requires some degree of innovation, and although there are numerous existing stablecoin solutions, Hyperliquid has a unique ecosystem positioning. Native Markets and Bridge clearly view USDH as a collaborative project, with the protocol directly engaging with Bridge and believing that necessary safeguards have been established. It should be noted that collaborating with licensed companies can also gain access to the infrastructure advantages of the Hyperliquid network — a point we value greatly, whose worth far exceeds the institutional-grade interface itself. Native Markets always maintains technological neutrality and ensures that this principle is a core consideration throughout the entire decision-making process.

As the least known bidder for USDH, Native Markets, whose proposal was previously led by community leader Max of Hyperion, plans to leverage Bridge to establish stablecoin-to-fiat channels. Regarding revenue sharing, they have expressed their intention to inject reserve interest profits into Hyperliquid's community aid fund. Their advantage lies in the team's deep roots within the Hyperliquid chain and a profound understanding of the local ecosystem.

September 8

Competition for Hyperliquid's USDH Stablecoin Issuance Right Heating Up with Several Institutions Vying, Paxos, Frax, and Others Have Submitted Bids

On September 8, it was reported that stablecoin issuers Paxos, Frax Finance, Agora, and others are competing for the upcoming issuance right of Hyperliquid's USDH stablecoin. Paxos submitted a USDH bid proposal on the 7th, committing to provide compliance with the MiCA and GENIUS acts, support native deployment on HyperEVM and HyperCore, and allocate 95% of interest income to HYPE token buybacks, redistributing the bought-back tokens to "ecosystem plans, partners, and users."

Frax proposed a "Community First" proposal and plans to peg USDH to frxUSD at a 1:1 ratio, with frxUSD supported by BlackRock's Income-Generating BUIDL On-Chain Sovereign Wealth Fund. Frax stated that "100% of the underlying sovereign wealth returns will be distributed directly to Hyperliquid users through on-chain programmatic means, with no fees charged by Frax." Hyperliquid's current stablecoin deposits can generate $220 million in annualized returns.

Agora also assembled a joint bidding team for USDH, promising that 100% of the net income from USDH will be distributed to Hyperliquid for platform assistance funds or HYPE token buybacks.

Meanwhile, the issuer of the third-largest USD stablecoin, USDe, Ethena Labs, hinted at joining the competition for the issuance right of Hyperliquid's USDH stablecoin.

Frax Founder on Hyperliquid USDH Competition: Interoperability Value Trumps Returns

On September 8, Frax founder Sam Kazemian took to social media to point out that the core insight of the Hyperliquid USDH event is that the true value of stablecoin issuers lies in the interoperability and deep integration of the economic distribution chain, rather than the obtainable sovereign wealth returns. He stated that candidate bidders, including Frax, Paxos, are willing to return 100% of the returns to Hyperliquid, but the actual value should surpass mere return sharing.

September 5

Hyperliquid to Release USDH Token Symbol for Stablecoin Issuance

On September 5, according to official announcements, Hyperliquid will release the USDH token symbol for stablecoin issuance. The trading pair symbol for USDH reserved by the Hyperliquid protocol will be released through a transparent on-chain process via validator voting. After the next network upgrade, validators will be able to vote on whether to allow a particular user address to purchase the USDH symbol. The voting process will be conducted entirely on-chain, completed through Hyperliquid L1 transactions, similar to delisting votes.

Teams interested in applying for this symbol can submit a proposal on the new forum, including the user address to be used for deploying the USDH symbol if elected by the required number of validators. It is important to note that even if the team is approved, they must still participate in the regular on-chain deployment gas auction.

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