DeFi's First Credit Rating Could Reshape Hyperliquid's Stablecoin Future

Sky, formerly known as MakerDAO, has entered the competition to back Hyperliquid’s USDH stablecoin with a proposal that leverages its $8 billion balance sheet, a seven-year operating history, and a B- credit rating from S&P Global — the first such rating awarded to a decentralized finance (DeFi) protocol. The proposal outlines a mechanism to offer USDH holders 4.85% returns, backed by $2.2 billion in redemption liquidity through Sky’s Peg Stability Module. This feature is designed to provide institutional traders with confidence in liquidity, enabling large-scale trading without price slippage or delays.

The Hyperliquid ecosystem, which processed nearly $400 billion in trading volume in August 2025, is in the process of selecting a stablecoin issuer for USDH. Validators are expected to cast their votes on September 14, with the Hyperliquid Foundation opting to abstain from the decision. Sky’s proposal emphasizes transparency and resilience, mirroring the operational model of its existing stablecoins DAI and USDS, which have maintained stability through multiple market downturns. The firm also plans to migrate its $250 million annual buyback engine to Hyperliquid, which could potentially boost the platform’s trading activity and enhance the value of the SKY token.

Sky’s proposal also includes a $25 million investment in a new initiative called the “Hyperliquid Genesis Star,” modeled after Sky’s Spark and Grove programs, which have attracted over $6 billion in total value locked. The initiative is expected to stimulate DeFi growth on Hyperliquid and could attract billions in deposits. In addition to yield and liquidity benefits, the proposal ensures USDH can be used across multiple blockchains via LayerZero technology, allowing users to interact with diverse ecosystems without relying on third-party intermediaries.

Other competitors in the USDH bidding process have adopted different strategies. Paxos has proposed using 95% of its reserve earnings for HYPE token buybacks, alongside a zero-fee USDC migration. Frax has focused on a community-centric model, offering 100% of its Treasury yield directly to users. Agora, supported by State Street, VanEck, and MoonPay, pledged to allocate all net revenue from USDH to HYPE buybacks, emphasizing neutrality. Meanwhile, Native Markets, linked to Stripe’s Bridge, has faced criticism over potential conflicts of interest tied to Stripe’s Tempo blockchain and its ownership of wallet provider Privy.

Sky’s S&P rating, though not investment-grade, represents a significant milestone for DeFi protocols and could reassure investors about its financial stability. The rating reflects a formal assessment of Sky’s operations, underlining its transparency and robust governance practices. As validators prepare to vote, the outcome will shape not only the structure of USDH but also the future direction of Hyperliquid’s monetary layer — whether it aligns with a DeFi-native protocol, a corporate-backed entity, or a traditional stablecoin issuer.