Competition intensifies as numerous teams vie for the opportunity to build Hyperliquid’s highly anticipated USDH stablecoin. Among those gearing up for the challenge, Native Markets has emerged as the current frontrunner, propelled by support from bettors on Polymarket, who attribute an 87% chance of success to the organization.
The bidding atmosphere became particularly dynamic when Paxos, a New York-based fintech well-known for its role in developing PayPal’s stablecoin, submitted a revised proposal on Wednesday. This marks the second adjustment to a proposal after Native Markets made a similar move earlier in the week. The influx of bids continued with several other teams joining the fray, including Curve Finance, Ethena, Sky, and Bastion Protocol, which has nearly doubled the number of competitive entries to almost a dozen.
Brett DiNovi, head of marketing at MegaLabs, emphasized the high stakes involved, remarking on the intense competition across the crypto landscape. “CEOs of multi-billion dollar companies are fighting for their lives getting proposals in,” he stated on the social media platform X.
Hyperliquid, a leading perpetual futures platform, opened up the proposal process for the USDH stablecoin on Friday. A unique aspect of this endeavor is that the winning bid will be chosen through a vote among Hyperliquid’s validators—entities responsible for running the protocol’s software. Bidders must carefully outline their plans for the USDH in their proposals to garner the essential votes.
The intense competitive landscape is reflective of Hyperliquid’s notable success; it remains the largest decentralized futures platform, boasting over $377 billion in trades within the past month. The anticipated stablecoin will likely attract substantial demand and present lucrative opportunities for its creator.
As for the current standings, Native Markets leads the charge. The organization has been strategically formed to pursue the rights to issue USDH and is backed by Max Fiege, an investor and advisor within the Hyperliquid ecosystem. CMI, a validator affiliated with Hyperliquid, has already signaled its intention to support Native Markets, underscoring the team’s alignment with Hyperliquid’s vision.
Following Native Markets is Paxos, which now holds an 8% chance of winning according to Polymarket bettors. Its new proposal introduces an integration with the PayPal ecosystem, along with a $20 million incentive fund, alongside a novel buyback and profit-sharing structure tied to a new token.
Ethena, the DeFi protocol known for its USDe dollar-pegged token, ranks third with a 6% chance. Ethena’s strategy involves backing USDH with its USDtb stablecoin, developed in partnership with Anchorage Digital Bank, while also committing to direct at least 95% of USDH reserves’ net revenue back to the Hyperliquid community.
Sky, previously recognized for its long-standing DeFi solutions, including DAI and USDS stablecoins, rounds out the contenders in fourth place. However, its odds are minimal—less than 1%—partly due to a recent credit rating from S&P Global Ratings, which categorized it as risky alongside debt from developing nations. This shadow of risk may influence perceptions of USDH in institutional circles, according to PaperImperium, a governance liaison for DAO services.
Hyperliquid validators will soon have the opportunity to cast their votes for their preferred proposal following the protocol’s next network upgrade, a timeline for which has yet to be confirmed. The outcome of this bidding war could potentially reshape the landscape of decentralized finance and stablecoins in the near future.
