Hyperliquid, a popular decentralized exchange with a dedicated layer-1 network, has opened proposals for teams to issue a USDH stablecoin that will be “Hyperliquid-first” and “Hyperliquid-aligned.”
However, one established Hyperliquid stablecoin protocol is calling foul play, as it was previously blocked from using the USDH ticker. And the timing of the Foundation's announcement has drawn other questions, as well.
The Discord announcement posted on Friday says the USDH ticker should go to a team building a “Hyperliquid-first, Hyperliquid-aligned, and compliant USD stablecoin.” Validators will vote over the next five days for the best team to build a “natively minted” stablecoin on Hyperliquid.
At the time of writing, three posts have been made in the USDH Discord proposals channel. One has been mostly dismissed by the community, another has been accused of having a head start, and the third is stirring controversy.
Native Markets made its proposal just over an hour after the announcement was made. The team threw its hat into the ring to build a GENIUS Act-compliant stablecoin with integrated fiat gateways, and will share its reserve proceeds with the Hyperliquid Assistance Fund. This proposal has received the most Discord reactions of any proposal thus far.
However, the already-established Hyperliquid stablecoin protocol, Hyperstable, has also stepped forward to push back on the USDH plans.
The author of the post, who goes simply by Max, claimed that the USDH ticker had previously been blacklisted, so Hyperstable was forced to use USH instead. Max argued that it is “unfair” for that to change as many builders have already pivoted, launched, and “reached the point of no return.”
“It seems unfair that the goal posts are now shifted after the game has already started months ago,” Max wrote. “If the Foundation wants to maintain their reputation for being credibly neutral toward all current and future teams that are building on HyperEVM, I strongly suggest they keep the USDH ticker blacklisted indefinitely or build an in-house stable themselves.”
Discord user Shisho, the apparent co-founder of Hyperliquid DEX aggregator LiquidLaunch, pushed back on this argument, claiming that the goal posts haven’t shifted; rather, the regulatory environment has, following the signing of the GENIUS Act into law.
Late last year, we decided to build @HyperstableX on @HyperliquidX because the ethos of decentralization and neutrality from the @HyperFND resonated deeply with us.
Since then, we've built and launched a novel decentralized and overcollateralized stablecoin that's backed by…
— Max (@hyperm4x) September 5, 2025
That wasn’t the end of the gripes, though. Another user called HyperInvestigator claims that the proposed Native Markets deployer address was funded by a freshly created wallet that was funded suspiciously close to the USDH announcement by Hyperliquid—just five hours before.
“Is Native Markets operating independently, or is there an undisclosed relationship with HL Labs/HL Foundation?” HyperInvestigator wrote on Discord, “If such a relationship exists, given that the Hyper Foundation's validators control >60% of staked HYPE, will the Hyper Foundation validators still be participating in voting on this?”
Max from Hyperstable added that the Native Markets proposal appears to be thoughtfully written and long, raising his suspicions that the team was given a heads-up.
Hyperstable, Native Markets proposer Max Fiege, and Hyperliquid did not immediately respond to Decrypt’s requests for comment.
Amid the controversy, Hyperliquid validators must make their choice over the next five days for which team will get the USDH ticker. Once quorum is reached, the ticker will be released to the address of the winning proposal.
It is just the latest in a line of stablecoins that have appeared throughout the year, with the likes of President Trump-linked World Liberty Financial releasing USD1, MetaMask preparing to release its own mmUSD stablecoin, and even major retailers like Amazon and Walmart exploring the option.
“Stablecoins have proven to be the most dominant, breakout use-case of crypto,” Paul Faecks, founder and CEO of stablecoin network Plasma, told Decrypt. “This encompasses everything from DeFi to payments. As the industry evolves, we anticipate seeing many more stablecoins being launched by institutions, chains, and existing on-chain applications."
