Hyperliquid is preparing a governance-driven launch of its native stablecoin, USDH, in its next network upgrade, according to a Sept. 5 update on the DEX Discord channel.
The protocol described USDH as a “Hyperliquid-first and compliant” dollar-pegged asset, but unlike conventional launches, it is opening the process to competition among development teams.
According to the protocol, interested teams must submit proposals to deploy the stablecoin. Once a validator quorum approves a candidate, the chosen team will still need to win a gas auction before deployment goes live.
Meanwhile, this move would significantly impact existing stablecoin providers on Hyperliquid.
Omar Kanji, partner at Dragonfly, said the move could weigh heavily on Circle’s USDC, currently the main settlement currency for derivatives trading on Hyperliquid. He noted that $5.5 billion in USDC deposits sit on the platform today.
According to him, a complete migration to USDH could generate an additional $220 million in annualized revenue for HYPE token holders, based on a 4% yield assumption.
At the same time, Kanji noted that the shift would cut into Circle’s revenues by an equivalent amount. He added that this shift would also represent a 7% reduction in USDC’s outstanding supply.
Other planned upgrade
Alongside the stablecoin launch, Hyperliquid is reshaping its market structure to improve trading efficiency.
The protocol confirmed it will reduce taker fees, maker rebates, and user volume contributions by 80% for spot pairs that involve two quote assets.
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This move would allow the DEX to deepen liquidity and lower barriers for traders by cutting costs at this scale.
Hyperliquid also plans to expand access to spot quote assets by making them permissionless. That rollout will begin on the testnet and eventually add staking requirements and slashing penalties to maintain security.
Together, these measures are designed to align user incentives while decentralizing participation in the exchange.
Hyperliquid’s growth
The planned updates arrive as Hyperliquid records accelerating growth on its trading platform.
According to DeFiLlama data, the DEX’s monthly trading volume reached a new all-time high of about $400 billion in August, pushing its market share above 60%.
As activity expands on the platform, the governance token HYPE has mirrored the momentum.
The token gained more than 22% in the past month, reaching a record high of $51 before stabilizing near $47 at press time, according to CryptoSlate data.