Ethena has submitted a governance proposal to issue USDH, the upcoming native stablecoin for the Hyperliquid ecosystem. The bid positions Ethena against competitors such as Frax, Sky, and Agora, while highlighting its institutional partnerships and track record in dollar-backed tokens.
Key Points
- USDH to be issued via Anchorage Digital Bank, collateralized by USDtb and linked to BlackRock’s BUIDL fund.
- Ethena promises 95% of revenue will flow back to Hyperliquid through buybacks, incentives, and ecosystem support.
- A $75M growth fund pledged to strengthen Hyperliquid’s infrastructure and front-end products.
- Security safeguards to include a guardian validator network with emergency oversight powers.
Institutional-Grade Backing
The plan would see USDH fully backed by USDtb, a payment token set for release by Anchorage Digital Bank on October 1. The stablecoin would also be indirectly tied to BlackRock’s BUIDL money market fund, offering a mix of regulatory compliance and market credibility.
Prominent supporters have already weighed in:
- Robert Mitchnick (BlackRock) said the model could provide “institutional-grade liquidity on-chain.”
- Nathan McCauley (Anchorage CEO) described the setup as a way to deliver a sovereign-grade stablecoin for Hyperliquid.
Community Incentives
Ethena has pledged to direct nearly all net revenues from USDH reserves—up to 95%—toward strengthening Hyperliquid’s ecosystem. This includes HYPE token buybacks, staking rewards, and contributions to the Assistance Fund.
Additionally, the company committed $75M in incentives to drive adoption of HIP-3 front-ends and new derivatives such as hUSDe, a Hyperliquid-native spin on Ethena’s existing USDe product.
Focus on Security
Ethena’s proposal emphasizes risk management, noting that poorly managed stablecoins can disrupt perpetual markets where stable assets underpin every trade. To mitigate this, a guardian validator system—potentially involving partners like LayerZero—would be empowered to freeze or reissue tokens if necessary.
Competitive Edge
Ethena argues that its experience with over $23B in tokenized dollars minted and redeemed without downtime, plus its $13B USDe balance sheet, positions it as the most reliable issuer to scale USDH into a multi-billion dollar stablecoin.
What’s at Stake
With more than $5B worth of USDC already circulating on Hyperliquid, the choice of who manages USDH will shape the platform’s stability, liquidity, and long-term growth. Ethena’s pitch combines institutional partnerships, deep liquidity, and ecosystem reinvestment—setting a high bar for rivals.
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