Paxos, a leading provider of stablecoin infrastructure, has recently revealed its plans to introduce USDH, a new stablecoin designed with a “Hyperliquid-first” approach and full compliance with regulatory standards such as the GENIUS Act and MiCA. This move is aimed at driving institutional adoption and aligning incentives within the ecosystem.
The announcement from Paxos highlights a unique tokenomics model for USDH, where 95% of the interest earned from USDH reserves will be used to buy back Hyperliquid’s native token, HYPE. These returns will then be redistributed among users, validators, and partner protocols. Additionally, Paxos will roll out USDH across HyperEVM and HyperCore, targeting institutional investors and fintech platforms by integrating with global banking systems and adhering to regulatory requirements.
With a network of over 70 financial partners spanning across regions like the U.S, EU, Singapore, Abu Dhabi, and Latin America, Paxos aims to efficiently distribute USDH while ensuring compliance with local regulations.
The community has reacted positively to the USDH proposal, with industry observers praising it as one of the most robust submissions to date. Rob Hadick, for example, commended the combination of Paxos’ infrastructure, Rain’s spending tools, LayerZero’s interoperability, and Ether.fi’s vault expertise in the proposal. He noted that this approach avoids common scaling and counterparty issues, laying a solid foundation for USDH’s transformative potential.
Meanwhile, Hyperliquid continues to lead in decentralized perpetual futures, generating $106M in revenue on a $400 billion trading volume and holding a 70% market share. This success has led to a surge in the price of HYPE, from $43 to $50.97, with an 83% increase in volume. At present, HYPE is trading at $51.40, following a 9.34% hike in the last 24 hours.
With the upcoming launch of USDH and its innovative rewards mechanism, Hyperliquid is poised to strengthen its position in the market. This initiative aims to bridge mainstream adoption with regulatory-compliant DeFi innovation, paving the way for a new era of growth and stability within the ecosystem.