Hyperliquid Surges 4.278% as VanEck Plans ETF and ETP

Hyperliquid's latest price was $55.41, up 4.278% in the last 24 hours. VanEck, a prominent investment management firm, has announced its plans to apply for a Hyperliquid physically-backed ETF in the United States and an Exchange-Traded Product (ETP) on a European platform. This move underscores the company's growing interest in the cryptocurrency space, particularly in Hyperliquid. VanEck's Senior Digital Asset Investment Analyst, Matt Maximo, highlighted that Hyperliquid has been a key focus for the company's liquidity fund this year. Additionally, Kyle Dacruz, VanEck's Director of Digital Asset Products, mentioned that the firm is considering allocating a portion of the investment product's net profit to HYPE buybacks, further demonstrating their commitment to the Hyperliquid ecosystem.

Hyperliquid's decision to launch its stablecoin, USDH, has sparked intense competition among various organizations vying for the right to issue the token. This move is significant as it aims to reduce reliance on Circle’s USDC, which has been the primary stablecoin used on the Hyperliquid network. The decentralized exchange has attracted proposals from several established players, including Paxos, Ethena, Agora, and OpenEden. Validators on the Hyperliquid network will ultimately decide who secures the mandate to issue USDH, but in the meantime, speculators have taken to Polymarket to place their bets on the outcome. Native Markets, a newcomer led by Max Fiege, an investor within the Hyperliquid ecosystem, stands out as the clear favorite in this competitive landscape. The firm's proposal includes a hybrid reserve model managed by BlackRock off-chain and Superstate on-chain, with half of the yield from reserve assets earmarked for HYPE token buybacks and the other half for USDH expansion.

Despite the enthusiasm surrounding Native Markets, there is skepticism within the community. Nick Van Eck, the founder of Agora, pointed out that Native Markets' reliance on Stripe could be detrimental to Hyperliquid in the long run. He raised concerns about Stripe's potential to drive users and perps from other financial applications directly to Tempo, a new layer 1 blockchain announced by Stripe. Dragonfly Capital’s Haseeb Qureshi suggested that Native Markets may have had advance notice of the request-for-proposals process, given how quickly its submission appeared. However, Alex Svavenik, the CEO of Nansen, countered this claim, stressing that validators have been deeply engaged with all bidders and that the process is far more competitive than critics suggest.

While Native Markets remains the frontrunner, other proposals are gaining momentum. Paxos, for instance, unveiled a revised plan centered on a partnership with PayPal. This collaboration would embed USDH into PayPal and Venmo products, list HYPE on PayPal’s ramps, and inject $20 million in incentives for the Hyperliquid ecosystem. Paxos also set strict revenue caps to assure the community of its long-term alignment, pledging to take nothing until it reaches $1 billion in TVL and stay capped at 5% post $5 billion TVL. Any fees earned by Paxos through this milestone will be held in HYPE tokens. Max Fantle, a Paxos executive, emphasized the potential of this partnership to unlock an entirely new institutional customer segment for Hyperliquid.

In addition to Paxos, Ethena, with backing from BlackRock, has also entered the race. Ethena's proposal suggests that its USDtb, the seventh-largest stablecoin, would back USDH, giving it indirect collateralization from BlackRock’s BUIDL fund. Ethena plans to allocate 95% of the revenue generated by its USDH reserves to the Assistance Fund or to purchase HYPE, the native token of the Hyperliquid network. This move is seen as a strategic play to offer institutional-grade cash management and further integrate Hyperliquid into the broader financial ecosystem.

The competition for the USDH stablecoin is not just about issuing a new token; it is about securing a lucrative position within the growing Hyperliquid community. The eventual winner of this bid will likely benefit immensely from the community's embrace of the token as the stablecoin of the network. Hyperliquid validators, responsible for securing the network, will state their voting intention by early Sunday, giving time for users to stake to a validator that matches their vote before the winner is formally decided. This on-chain vote by Hyperliquid stakeholders is set to culminate in a decisive moment for the future of the USDH stablecoin and the broader Hyperliquid ecosystem.

Hyperliquid is advancing toward launching its native stablecoin USDH, with a critical validator vote scheduled for September 14, 2025, to determine the issuing partner. This initiative aims to reduce the platform’s operational reliance on third-party stablecoins and enhance ecosystem control, sparking competitive proposals from several major crypto firms. Ethena Labs has proposed an innovative USDH model collateralized by USDtb, a stablecoin tied to BlackRock’s BUIDL fund, with a commitment to return 95% of net reserve revenue to the Hyperliquid ecosystem. Their strategy includes covering migration costs for existing USDC pairs and integrating diverse assets like BTC and HYPE to boost utility. Anchorage Digital Bank’s backing further strengthens Ethena’s technical proposition, positioning USDH for broader adoption.

Paxos has emphasized regulatory compliance in its USDH bid, highlighting adherence to NYDFS and EU MiCA standards. The proposal focuses on integrating USDH with PayPal and Venmo to accelerate mainstream accessibility while pledging 95% of reserve yield toward HYPE token buybacks. This institutional-focused approach prioritizes stability and regulatory security over decentralized features. Frax Finance has submitted a decentralized USDH model targeting DeFi users, minting the stablecoin against frxUSD and Treasuries while distributing all Treasury yield directly to Hyperliquid participants. Sky Ecosystem offers a similar decentralized issuance framework via an $8 billion balance sheet, featuring a 4.85% yield mechanism and an integrated Hyperliquid buyback system to incentivize ecosystem growth.

The bidding process has raised fairness considerations as Hyperliquid validators prepare to evaluate proposals based on technical viability, revenue-sharing models, and long-term ecosystem alignment. The outcome will significantly influence Hyperliquid’s operational independence and its capacity to redirect stablecoin-related revenue streams into platform development. The competition for the USDH stablecoin is not just about issuing a new token; it is about securing a lucrative position within the growing Hyperliquid community. The eventual winner of this bid will likely benefit immensely from the community's embrace of the token as the stablecoin of the network. Hyperliquid validators, responsible for securing the network, will state their voting intention by early Sunday, giving time for users to stake to a validator that matches their vote before the winner is formally decided. This on-chain vote by Hyperliquid stakeholders is set to culminate in a decisive moment for the future of the USDH stablecoin and the broader Hyperliquid ecosystem.