In the fast-paced world of decentralized finance, Hyperliquid—a leading perpetual futures exchange built on its own Layer 1 blockchain—is making waves with its bid for a native stablecoin, USDH. What started as a request for proposals (RFP) has turned into a full-blown battle among top crypto players, each vying to issue and manage this crucial asset. If you're new to this, a stablecoin like USDH is designed to hold a steady value, typically pegged to the US dollar, making it essential for trading, lending, and avoiding volatility in crypto markets.

The excitement kicked off when Hyperliquid invited proposals for USDH, drawing in six major contenders. Each brings a unique pitch, from regulatory compliance to yield-sharing and ecosystem integrations. Crypto researcher @0xAlan_ broke it down in a detailed thread, highlighting the strengths of each proposal. Let's quickly recap the key players:

• Native Markets: Backed by heavyweights like Blackrock and Superstate, they promise a regulated fiat-backed USDH with 50% of reserve yields funneled into Hyperliquid's Assistance Fund. They also plan debit cards for spending USDH and full compliance with US and EEA regulations.

• Paxos: Known for issuing stablecoins like USDP, Paxos revamped their offer with a PayPal partnership for free on/off-ramps, ecosystem incentives, and global scalability. They emphasize making USDH the default quote asset on Hyperliquid's markets and tying rewards to TVL milestones.

• Ethena: Behind the popular USDe, Ethena proposes a fiat-backed USDH with 95% of net revenue going to HYPE buybacks (HYPE being Hyperliquid's points system, often seen as a precursor to a token). They highlight integrations with Blackrock's BUIDL and plans to add USDH as collateral for their products, unlocking billions in liquidity.

• Sky (formerly MakerDAO)​: With over $8 billion in stablecoin TVL, Sky offers multichain support, instant USDC liquidity, and a 4.85% return on USDH holdings for HYPE buybacks. They also commit $25 million to bootstrap DeFi on Hyperliquid through a "Hyperliquid Star" initiative.

• Frax: Frax brings a high-yield model where 100% of treasury earnings (estimated at $220 million annually from $5.5 billion deposits) flow back to Hyperliquid users. They focus on seamless minting across chains and a proven track record of secure stablecoin launches.

• Agora: Teaming up with Rain for card payments and LayerZero for cross-chain interoperability, Agora emphasizes institutional-grade infrastructure with custodians like State Street. They pledge 100% revenue share to HYPE buybacks and $10 million in day-one liquidity.

These proposals aren't just talk—the community votes with their stakes. Hyperliquid users stake HYPE points on validators aligned with specific proposals, determining who wins the USDH ticker. Early on, Native Markets led with about 30.8% of delegated stakes, as reported by CoinDesk. Polymarket bettors echoed this, giving Native Markets a 75% chance of winning.

But as Castle Labs pointed out in their recent tweet, the race isn't over. With days left before the vote closes, stakes are shifting. Validators supporting Native Markets, like Nansen x HypurrCollective and Hypurrscanning, are seeing outflows—drops of up to 2.43% in the last 24 hours. Meanwhile, Paxos-aligned validators such as Purrposeful x HyBridge x PiP are experiencing inflows, with gains as high as 15.95% over the same period.

This movement suggests voters are rethinking their positions, possibly swayed by Paxos' strong partnerships and global reach. As one reply noted, "last 48h flows always tell the real story," hinting at potential late-game drama.

Why does this matter for meme token enthusiasts? Hyperliquid's ecosystem, fueled by HYPE points, has a meme-like vibe—community-driven, speculative, and viral on platforms like X. The USDH decision could supercharge liquidity and adoption, creating new opportunities for meme tokens built on Hyperliquid. Plus, with figures like Arthur Hayes buying into Ethena ahead of the vote, it's clear big money is watching.

As the clock ticks down, keep an eye on those stake flows. Will Native Markets hold their lead, or will Paxos pull off an upset? Either way, this battle underscores Hyperliquid's growing influence in DeFi. For more updates, check out the original thread on X or dive into Hyperliquid's docs at hyperliquid.xyz.