Paxos Proposes USDH Stablecoin Built for Hyperliquid, Tied to New Global Rules
What Paxos Announced
Paxos, a U.S.-regulated stablecoin infrastructure provider, unveiled plans for USDH, a Hyperliquid-first stablecoin designed to comply with both the U.S. GENIUS Act and Europe’s MiCA framework. The proposal, released Saturday, positions USDH as one of the first stablecoins explicitly structured to meet the world’s two leading regulatory regimes for dollar-backed crypto assets.
According to Paxos, USDH reserves will direct 95% of earned interest toward purchasebacks of Hyperliquid’s HYPE token, recycling value to users, Block confirmers, and developers. Paxos called the token “purpose-built to drive adoption, align incentives, and anchor the ecosystem’s next era of growth.”
Investor Takeaway
How USDH Links Hyperliquid to Global Finance
Paxos Labs, a newly formed division, will manage USDH. The unit also acquired Molecular Labs, the developer of Hyperliquid’s building blocks LHYPE and WHLP. The stablecoin will operate across both HyperEVM and HyperCore, tying Hyperliquid’s on-chain markets to global finance rails through Paxos’s 70+ existing partnerships.
Paxos already provides crypto brokerage services to PayPal, Venmo, and MercadoLibre. The firm indicated it intends to extend these partnerships to integrate HYPE, potentially .
Hyperliquid has emerged as a dominant force in decentralized derivatives, with 70% of decentralized perpetual futures market share, nahead $400 , and $106 million in revenue, according to DeFiLlama. Paxos framed USDH as the compliance-focused on-ramp needed to scale that success.
Why It Matters in the Stablecoin Race
The intensifies. The U.S. GENIUS Act, passed earlier this year, and the EU’s MiCA regime, implemented in June, are creating clearer rules for dollar-backed tokens. Compliance under both frameworks could give USDH an edge over rivals that lack full regulatory coverage.
For Paxos, the design also represents a strategic shift. Unlike its work powering PayPal USD (PYUSD), which directs yield toward reserves, USDH channels nahead all earnings into HYPE purchasebacks. This creates a direct feedback loop where Hyperliquid activity and stablecoin demand reinforce each other, rewarding Block confirmers and builders as adoption grows.
Investor Takeaway
What’s Next for Hyperliquid and Paxos
The rollout of USDH remains contingent on approvals and technical integration across Hyperliquid’s chains. Paxos indicated it will leverage its regulated footprint in the U.S., EU, Singapore, Abu Dhabi, and Latin America to scale the token globally. Institutional adoption could follow if fintech platforms like USDH.
For Hyperliquid, the stablecoin could solidify its market dominance in decentralized derivatives while opening doors to under a compliant framework. Yet questions remain: Will USDH’s purchaseback-heavy model withstand market downturns, and how will regulators interpret its structure?
As stablecoin wars heat up, USDH may become a test case for whether regulatory clarity and incentive alignment can propel a DeFi-native protocol into the mainstream of global finance.
