USDH Stablecoin Goes Live on Hyperliquid with $2.2M Early Trading Volume – Can it Replace Tether?

Core Insights - Hyperliquid's native stablecoin, USDH, launched on September 23 with an early trading volume of $2.2 million, following a governance victory over established players like Paxos and Ethena Labs [1] - The stablecoin maintained its $1.00 peg during early trading, only fluctuating to $1.001 as liquidity and stability were tested [2] - Native Markets structured the USDH launch as a gradual rollout, initially capping transactions at $800 per user for real-world testing [3] Company Developments - Several integration phases for USDH will occur over the coming months, starting with HyperEVM integrations and expanding its role as a spot quote asset [4] - The issuer structured USDH reserves using cash and short-term U.S. Treasury holdings managed off-chain by BlackRock, with on-chain assets operating through Superstate and Stripe's Bridge [5] - Native Markets plans to allocate 50% of its reserve yield to Hyperliquid's Assistance Fund, with the remainder for USDH ecosystem development [5] Industry Trends - The launch of USDH reflects a broader trend in decentralized finance (DeFi) where trading platforms aim to reduce reliance on external stablecoin issuers and capture reserve yield revenue internally [7] - Tether's USDT remains the dominant stablecoin in the market, with $173.05 billion in circulation and processing over $24.6 billion daily on TRON [7] - Hyperliquid currently hosts over $5.5 billion in Circle's USDC, generating an estimated $220 million annually in treasury yield revenue for Circle [6]