Community Pushback Grows Against Hyperliquid’s Stripe-Linked USDH Plan

Hyperliquid’s plan to launch its own stablecoin, USDH, has become one of the most heated governance debates in crypto this year. The new token could replace $5.5 billion of USDC—currently 95% of the platform’s stablecoin supply—and generate hundreds of millions in revenue from Treasury yields. The decision will be made by a validator vote on September 14.

Key Bidders and Proposals
The race includes Paxos, Frax, and a coalition led by Agora, backed by MoonPay. Paxos plans to allocate 95% of reserve earnings to HYPE token buybacks, relying on its decade-long regulated issuer experience. Frax offers a “community-first” approach, passing 100% of Treasury yield to users. Agora pledges neutrality and alignment with Hyperliquid, committing all net revenue to HYPE buybacks or the Hyperliquid Assistance Fund. Ethena may also enter, further crowding the field.

Stripe Proposal Sparks Controversy
A proposal tied to Stripe’s Bridge platform has drawn criticism. Some community members argue that allowing Stripe—already developing its Tempo blockchain and controlling wallet infrastructure via Privy—would cede economic sovereignty to a competitor.

Agora CEO Nick van Eck said, “If Hyperliquid relinquishes their canonical stablecoin to Stripe, a vertically integrated issuer with clear conflicts, what are we even doing?” MoonPay President Keith Grossman added that USDH “deserves scale, credibility, and alignment—not capture,” emphasizing MoonPay’s regulatory reach and user base.

Next Steps
Proposal submissions close September 10, with the validator vote on September 14 determining the winner. The Hyperliquid Foundation plans to abstain, leaving the decision entirely to validators. With an 80% share of the DeFi derivatives market, the USDH contract represents a highly lucrative and strategic opportunity.