JPMorgan Backs Hyperliquid Over Circle in Stablecoin Market Shakeup

JPMorgan analysts led by Nikolaos Panigirtzoglou suggest Tether's new US-compliant stablecoin USAT and Hyperliquid's USDH could pressure Circle's dominance. The launch follows Circle's 2023 exposure to Silicon Valley Bank, highlighting vulnerabilities in legacy stablecoin models.

Hyperliquid's MOVE to reduce USDC dependency with its USDH stablecoin has already impacted Circle's market share, with 7.5% of USDC usage at risk. Circle responded by announcing strategic investments in Hyperliquid's ecosystem, including token purchases and developer incentives.

The stablecoin wars are entering a new phase as fintech giants like Robinhood and Revolut reportedly consider distancing from traditional players. Market dynamics suggest this zero-sum competition will intensify unless overall crypto market growth accelerates.