Paxos Proposes USDH Stablecoin to Strengthen Hyperliquid Ecosystem
Stablecoin infrastructure provider Paxos has unveiled plans to launch USDH, a stablecoin designed primarily for the Hyperliquid platform. The proposed USDH stablecoin aims to comply fully with the U.S. Guiding and Establishing National Innovation for US Stablecoins Act (GENIUS Act) as well as the European Markets in Crypto-Assets (MiCA) regulatory framework.
Yield Allocation to HYPE Token Buybacks
Paxos Labs and Molecular Labs Acquisition
The USDH initiative will be led by Paxos Labs, a newly established entity within Paxos. This division recently acquired Molecular Labs, the developer responsible for Hyperliquid’s core primitives LHYPE and WHLP. This acquisition enhances Paxos’ technical expertise and integration capabilities with Hyperliquid’s on-chain financial infrastructure.
Bridging Hyperliquid to Institutional Markets
USDH is set to be deployed on both HyperEVM and HyperCore blockchain networks. Paxos intends for the stablecoin to facilitate institutional access to Hyperliquid by linking it to global banking rails and providing regulatory clarity. Leveraging its existing partnerships with over 70 financial institutions across major jurisdictions—including the US, EU, Singapore, Abu Dhabi, and Latin America—Paxos plans to distribute USDH widely within regulated markets.
Beyond the stablecoin itself, Paxos will integrate the HYPE token into its brokerage infrastructure, which already supports crypto services for major platforms such as PayPal, Venmo, and MercadoLibre.
Hyperliquid’s Market Position
Hyperliquid is a leading decentralized perpetual futures platform, commanding approximately 70% of the market share. It generated over $106 million in revenue last month on nearly $400 billion in trading volume, ranking just behind Uniswap and PancakeSwap in weekly decentralized trading volume, according to DefiLlama data.
FinOracleAI — Market View
Paxos’ proposal to launch USDH as a fully compliant stablecoin tied to the Hyperliquid ecosystem is likely to have a positive short-term market impact. The initiative strengthens institutional connectivity by bridging decentralized finance with regulated financial infrastructure, which may increase adoption and liquidity for both USDH and HYPE tokens. The yield redistribution mechanism via HYPE buybacks aligns stakeholder incentives and could enhance token value. However, regulatory approval processes and the actual uptake by institutional players remain key risks to monitor.
Impact: positive
