Investor Trust Shifts to Native Markets as Ethena Exits Bidding War

The odds of the native markets prevailing in the hyperliquid stablecoin bidding war have surged to 94.8% following Ethena's withdrawal from the competition, according to the latest data from Polymarket. This shift has significantly altered the competitive landscape and reallocated speculative capital in favor of the remaining contenders.

Prior to Ethena’s exit, the market was characterized by a more distributed probability distribution among several key players, with no single entity garnering more than a 40% probability of success. Ethena's departure has led to a consolidation of market confidence, with Polymarket traders increasingly favoring the native market solution. This movement reflects a broader trend of investor trust in on-chain governance models and native token utility.

Analysts suggest that Ethena's decision to step aside may have been influenced by strategic considerations regarding long-term token value and liquidity. The removal of a major competitor has also reduced uncertainty among market participants, contributing to the sharp rise in the probability assigned to the native market option. This development may also have implications for future stablecoin auctions, potentially encouraging greater participation from decentralized governance structures.

Despite the high probability assigned to the native market, some market observers caution against over-interpretation of Polymarket data. While the odds are illustrative of current sentiment, they do not constitute a definitive forecast of the auction’s outcome. However, the rapid shift in odds following Ethena's exit underscores the significant influence that major players can have on market dynamics.

Looking ahead, the final decision will be determined by the governance mechanisms of the hyperliquid platform, which will evaluate bids based on criteria such as capital efficiency, risk management, and token utility. The final decision is expected to be announced within the next two weeks, at which point further market reactions may follow.