USDH is @HyperliquidX’ new stablecoin that launched on September 23rd. Here's what it actually is & why it exists. ➠ What is USDH? USDH is a dollar-pegged stablecoin built specifically for Hyperliquid. It's backed by cash & short term US Treasury bonds, just like USDC or USDT. The difference is who gets the profits from those reserves. > $25.24M minted in first 3 days > $2M+ in trading volume (2% mindshare) ➠ The Old model vs New model👇 1/ With USDC: Circle holds your dollars in Treasury bonds, earns about 4% interest annually, keeps all the profits 2/ With USDH: @nativemarkets holds the dollars in Treasury bonds, earns the same 4% interest, but splits it 50/50 between HYPE token buybacks & ecosystem development funding. ➠ How It's backed? > Cash + short term US Treasuries (same as regulated stablecoins) > Reserves managed by BlackRock & Superstate > 50% of yield goes to HYPE buybacks via Support Fund > 50% reinvested in ecosystem growth @nativemarkets won the bid to issue USDH on Hyperliquid with 78.75% of validator votes. They won by beating the likes of Paxos, Frax, Agora & Ethena. (Note they’re a startup created just weeks before the competition) > Paxos offered PayPal integration & 95% yield sharing > Frax partnered with BlackRock & pledged 100% returns > Agora had State Street backing But they won with their Hyperliquid first approach & team connections to the ecosystem. ➠ Why did Hyperliquid built this? > Hyperliquid holds $5.89B in USDC I.e almost ~74% (That generates roughly $220M annually in interest that goes to Circle > USDH keeps that money in their ecosystem instead > They also cut trading fees by 80% for USDH pairs to incentivize adoption ➠ Will traders actually switch from USDC to USDH? Lower fees help, but changing habits takes time. The success depends on execution by a very new company handling billions of dollars. This is essentially @HyperliquidX trying to capture stablecoin profits.