Paxos has taken a bold step by submitting a proposal to the U.S. Securities and Exchange Commission (SEC) to back USDH, a new stablecoin designed for Hyperliquid. The initiative comes through its newly formed division, Paxos Labs, and highlights the company’s commitment to regulatory compliance and ecosystem growth.
Regulatory Alignment Across Borders
USDH is built to meet strict compliance standards, including the U.S. GENIUS Act and Europe’s MiCA framework. Paxos stresses that its infrastructure is globally adaptable, covering regions such as Asia-Pacific, Latin America, Africa, and the Middle East. This ensures the new stablecoin can serve users and institutions across multiple jurisdictions.
Yield and Ecosystem Incentives
What sets USDH apart is its yield-sharing structure. Ninety-five percent of the interest generated from USDH’s reserves will be used to repurchase HYPE, Hyperliquid’s native token. These tokens will then be distributed to builders, validators, and users. The goal is to reward active participants while driving deeper engagement with the protocol.
Expanding Institutional Access
USDH will launch on both HyperEVM and HyperCore chains. Paxos intends to attract institutional players and fintech firms by using its established network of more than 70 financial partners. This network already supports major platforms like PayPal, Venmo, and MercadoLibre, making it easier for institutions to connect with Hyperliquid’s growing ecosystem.
By introducing USDH, Hyperliquid reduces reliance on external stablecoins like USDC or USDT and strengthens its native economy. For Paxos, this move extends its stablecoin influence while demonstrating strong regulatory awareness. The combination of compliance, yield incentives, and institutional integration could make USDH a powerful driver for Hyperliquid’s long-term growth.
