Hyperliquid’s Stripe-Linked USDH Proposal Sparks Major Community Backlash

Hyperliquid faces mounting resistance from its user base over controversial USDH stablecoin integration plans involving payment giant Stripe.

Community Pushback Intensifies

Token holders and platform users are voicing strong opposition to the proposed Stripe partnership, citing concerns over centralization and potential vulnerability to traditional finance's regulatory overreach. The backlash manifests across social channels and governance forums, with many arguing the move contradicts decentralized finance's core principles.

Stripe's Crypto Foray Faces Skepticism

The payments processor's attempt to enter the stablecoin space through Hyperliquid meets hardened crypto-native resistance. Critics question whether traditional finance giants truly understand—or care about—decentralization values beyond profit opportunities.

Because nothing says 'decentralized finance' like inviting your traditional banking overlords to the party—just what crypto enthusiasts always wanted.

Crowded field

Paxos has pitched 95% of reserve earnings into HYPE token buybacks, leaning on its decade-long track record as a regulated issuer. Frax offered a “community-first” model, passing through 100% of Treasury yield to users with zero take.

Agora’s bid emphasized neutrality and alignment, promising 100% of net revenue for HYPE buybacks or Hyperliquid’s Assistance Fund.

With Ethena hinting it may enter the race, the lineup of bidders could expand, adding another layer of complexity to an already crowded field.

Each proposal offers a different vision for how USDH should function: From Paxos’ regulatory-first approach to Frax’s user-yield model to Agora’s Hyper-native coalition backed by institutional custodians and consumer-facing payment rails.

Hyperliquid dominates the DeFi derivatives market, with nearly an 80% market share. Given the growth of the Hyperliquid ecosystem, the right to issue its native stablecoin WOULD be incredibly lucrative for whoever is awarded the contract.

Hyperliquid set Sept. 10 as the deadline for proposals — more are expected in the next 48 hours — and Sept. 14 as the date for the validator vote. The Hyperliquid Foundation also said that it will “effectively abstain,” leaving the decision to validators.