What happened?
Hyperliquid’s native stablecoin, USDH, was launched on September 23 following Native Markets’ victory in a competitive governance vote. With $2.2 million in early trading volume, the stablecoin commenced trading with a USDH/USDC spot pair on HyperCore. Testing market liquidity and stability mechanisms, the stablecoin remained pegged around $1.00 during early trading sessions.
Who does this affect?
This launch impacts Hyperliquid users, as well as other established players including Paxos and Ethena Labs who contested for the right to issue USDH. Moreover, it potentially affects the whole decentralized finance (defi) landscape by increasing competition in the market dominated mostly by established external stablecoin issuers like Tether’s USDT and Circle’s USDC.
Why does this matter?
The introduction of USDH contributes towards a shift in the defi landscape, driving trading platforms to reduce dependence on external stablecoin issuers and capture reserve yield revenue internally. This launch signifies an increasing fragmentation in the stablecoin market. If successful, the growth of ecosystem-focused stablecoins like USDH could also depend on the growth trajectories of their host platforms, serving as platform-specific alternatives to generalized ones.