- Ethena Labs pulls its bid for Hyperliquid’s USDH stablecoin after community feedback, focusing on new product development within the ecosystem.
- Native Markets leads with 91% odds to win the USDH validator vote, gaining significant community support in the process.
- Kraken plans to list USDH, expanding its institutional visibility, while competition heats up with firms like Paxos and Frax entering the race.
Ethena Labs has officially stepped back from its bid to manage Hyperliquid’s USDH stablecoin, signaling a shift in the competition for the role. The company’s decision to pull out came after receiving feedback from community members and validators. They raised concerns about Ethena’s non-native association with Hyperliquid and the broader ambitions of the company beyond the USDH stablecoin.
The founder of Ethena Labs confirmed the move via a post on social media, noting that the decision was based on direct feedback from the Hyperliquid community and validators. The feedback emphasized that Ethena was not considered a core player within Hyperliquid’s ecosystem. Despite pulling out of the race, the company remains focused on the development of new products within the Hyperliquid network.
Native Markets Emerges as Front-Runner
With Ethena Labs out of the race, Native Markets has gained significant momentum. The protocol is now seen as the most likely candidate to secure the validator vote for issuing the USDH stablecoin. Polymarket traders have given Native Markets a 91% probability of winning, reflecting growing confidence in the team’s ability to lead the stablecoin project.
The Hyperliquid Foundation, which is overseeing the vote, has indicated that it will align its own vote with the group receiving the most community support. This transparent, community-driven process aims to ensure that the team with the broadest backing takes the reins for the USDH project.
Focus on New Product Development
Ethena Labs’ exit does not signal an end to their involvement in Hyperliquid. Instead, the company is shifting its focus to new product innovations within the Hyperliquid ecosystem. The company has unveiled plans for synthetic dollar instruments such as hUSDe, alongside savings and card spending solutions linked to the USDH stablecoin. This could significantly impact the Hyperliquid platform, contributing to its expansion and future development.
As the USDH stablecoin race intensifies, institutional backing is also building. Kraken plans to list USDH alongside HYPE, which is expected to enhance the stablecoin’s visibility in the institutional market. Additionally, key players such as Paxos, Frax, and Agora have also entered the race for the validator vote, making the competition even more significant.
The USDH validator vote is set for September 14, and its outcome will determine the team that controls a $5.9 billion stablecoin reserve. This vote marks a critical moment for the Hyperliquid ecosystem, as the winning team will be responsible for steering the project forward into its next phase.
