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"Hyperliquid, the giant behind 80% of decentralized perpetual trading, is launching its own stablecoin USDH—but with a twist. Instead of building it themselves, six major players including Paxos, Ethena, Sky, Frax, Agora, and Native Markets are battling for the right to issue it.
With $5.6B in deposits and $220M in annual revenue on the line, this is the biggest stablecoin auction in DeFi history. The outcome could spark the next phase of the stablecoin wars and reshape the future of DeFi."
~ Coin Bureau
The video discusses a significant event in the world of decentralized finance (DeFi): the launch of a new stablecoin, USDH, by Hyperliquid, a platform that dominates 80% of decentralized perpetual trading. Instead of building the stablecoin themselves, Hyperliquid is holding a competition where six major organizations are bidding for the right to issue it. The winner will be decided by a validator vote. The stakes are high because Hyperliquid currently relies on Circle's USDC, with $5.6 billion in deposits. This money generates an estimated $220 million in annual interest, all of which goes to Circle. By launching USDH, Hyperliquid aims to redirect this revenue back to its own ecosystem, potentially tripling its current revenue.
The six organizations competing for the contract are: Native Markets, Paxos, Athena Labs, Sky, Agora, and FRA Finance. Each organization has a unique proposal. For example, Native Markets, the current favourite, proposes using BlackRock for reserves and Stripe's bridge platform for issuance. Paxos, an institutional player, proposes integrating USDH into PayPal and Venmo and offering a 95% revenue share to the Hyperliquid community. Athena Labs, behind the USDE stablecoin, is promising at least $75 million in ecosystem incentives. Sky, formerly known as MakerDAO, is offering the highest yield on USDH at 4.85%. Agora is promising 100% of net revenue to Hype token buybacks. FRA Finance is offering to return 100% of the treasury yield to users with zero fees. The selection process is a stake-weighted vote by validators, with the Hyperliquid Foundation abstaining to ensure community governance. The outcome could reshape the competitive landscape of digital dollars.
0:00 – Biggest Stablecoin Auction in DeFi History
1:45 – Why Hyperliquid Is Launching USDH
3:20 – Meet the Contenders: Paxos, Ethena, Sky & More
6:10 – Governance, Validators & Community Vote Explained
8:05 – Circle’s $220M Revenue Threat & Wall Street Reaction
10:15 – What This Means for DeFi & the Future of Stablecoins
Source - Coin Bureau YouTube: https://www.youtube.com/watch?v=7-nJB-9vm_Y
Disclaimer: This video is provided for informational purposes only, and not offered or intended to be used as legal, tax, investment, financial, or any other advice.
