A governance vote is planned by the decentralized exchange and L1 chain Hyperliquid, in which protocol validators will decide which team will be assigned the USDH ticker to issue a native stablecoin on the network.
Via a Sunday post in the project’s official Discord server, it was confirmed by the Hyperliquid team that the voting will occur on Sep. 14 from 10:00 to 11:00 UTC.
However, before the vote, proposals must be submitted by teams vying for the USDH designation by September 10. Validators are then expected to publicly reveal their preferred choice by Sep. 11 to give users time to “stake to a validator who matches their vote.”
“It was stated by the team that voting is based on stake, and validators will cast their vote by submitting the address corresponding to the team they support.”
It was further clarified by the team that the vote is exclusively for the ticker assignment and does not grant any exclusive rights or special privileges to the chosen issuer.
It was also stated by Hyperliquid that multiple stablecoins will continue to exist on its blockchain and new stablecoin teams will join the ecosystem. USDH will be only one of many such stablecoins.
Stablecoin Issuers Compete to Launch USDH
Plans to launch a proprietary stablecoin were announced by Hyperliquid on Sep. 5. It will function as a “Hyperliquid-first, Hyperliquid-aligned, and compliant USD stablecoin,” as part of the protocol’s next major update designed to “improve liquidity and reduce user friction.”
USDH is intended as an alternative to bridged assets like USDC, which currently accounts for 95% of the $5.6 billion stablecoin supply on the network, according to DefiLama data.
Issuers interested in deploying USDH have been asked to submit proposals, and the winning team will be chosen through a validator vote on the blockchain. The selection is based on stake-weighted support from the network’s validators.
As of Sep. 8, proposals have been submitted by four teams: Paxos Labs, Frax Finance, Agora, and a Hyperliquid-native group called Native Markets. Each bidder has outlined a different model for the upcoming stablecoin’s backing and distribution.
Plans to channel net revenue from its cash and U.S. Treasury reserves into Hyperliquid’s Assistance Fund or dedicated HYPE token buybacks were even outlined by Agora’s proposal.
HYPE Price Surges Amid Stablecoin News
Since the Friday announcement, a rally of nearly 12% was experienced by HYPE, the decentralized exchange’s native cryptocurrency. At press time, it was trading at just 2.3% below its record high of $50.99.
Besides the stablecoin plans, much of this performance has been supported by the platform’s expanding stature as a premier DEX, particularly for perpetual futures trading. Last month’s DefiLama data shows that the platform processed $398 billion in perpetual derivatives trading volume and $20 billion in spot trades.
Hyperliquid has also been recognized as the eighth-largest decentralized finance (DeFi) protocol when measured by total value locked (TVL).
