Stablecoin Project USDH Proposal by Hyperliquid Sparks Controversy Due to Suspicions of Underhanded Tactics
In the world of decentralised finance (DeFi), Hyperliquid, a popular DEX aggregator, has recently opened proposals for teams to issue a USDH stablecoin on its network. However, the process has sparked controversy and raised concerns among some participants.
Max (@hyperm4x), the founder of one of the established Hyperliquid stablecoin protocols, Hyperstable, wrote a post on September 5, 2025, expressing concerns about the Native Markets proposal. Max argues that it is unfair for the rules to change after many builders have already pivoted, launched, and "reached the point of no return."
Hyperstable claims that the USDH ticker had previously been blacklisted, forcing it to use the USH ticker instead. One established Hyperliquid stablecoin protocol, Hyperstable, has called the process unfair, as it was previously blocked from using the USDH ticker.
Max from Hyperstable suspects that the Native Markets team may have received a heads-up about their proposal. This suspicion was further fuelled when HyperInvestigator claimed that the proposed Native Markets deployer address was funded suspiciously close to the USDH announcement by Hyperliquid.
HyperInvestigator also questions if there is an undisclosed relationship between Native Markets and HL Labs/HL Foundation, the entities that control validator votes. Shisho, the co-founder of Hyperliquid, has pushed back on Max's argument, claiming that the regulatory environment has changed following the signing of the GENIUS Act.
The Native Markets team, however, has made a proposal to build a GENIUS Act-compliant stablecoin with integrated fiat gateways and share its reserve proceeds with the Hyperliquid Assistance Fund. This proposal has received the most Discord reactions of any proposal thus far.
President Trump-linked World Liberty Financial, MetaMask, Amazon, and Walmart are among the entities exploring stablecoins, indicating a growing interest in the digital currency space. Paul Faecks, founder and CEO of stablecoin network Plasma, anticipates seeing many more stablecoins being launched by institutions, chains, and existing on-chain applications.
As validators have five days to vote on proposals, the future of the USDH stablecoin on Hyperliquid remains uncertain. The ticker will be unlocked for the winning team once quorum is reached, making the next few days crucial for all parties involved.
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