Key Takeaways:
- Ethena has withdrawn from the USDH race, shifting prediction market odds heavily in favor of Native Markets (92%).
- Critics, including Dragonfly’s Haseeb Qureshi, have raised concerns about bias and the fairness of the USDH RFP process.
- Native Markets proposes minting USDH on HyperEVM with reserves split between BlackRock and Superstate, raising centralization concerns.
Prediction markets now strongly favor Native Markets to win Hyperliquid’s race to issue its native stablecoin USDH, after Ethena Labs withdrew its proposal.
Ethena, the team behind the synthetic dollar protocol USDe, stepped aside following discussions with validators, citing concerns about not being a Hyperliquid-native project.
The last few days have been incredible to witness. I've never seen a community rally around and engage with passion like this before.
— G | Ethena (@gdog97_) September 11, 2025
Following direct discussions with individuals in the community and validators we have taken onboard some of the concerns, namely:
-Ethena is not…
Founder Guy Young praised the community’s openness to new entrants, even amid questions over Native Markets’ credibility.
With Ethena out, Polymarket data shows Native Markets with a 92% probability of success, while Paxos trails at 7%.
The bidding process has faced criticism.
Dragonfly’s Haseeb Qureshi argued the RFP was skewed toward Native Markets, pointing to their rapid submission and early validator support.
Other critics, including OAK Research’s Lilian Aliaga, questioned the team’s capacity to scale USDH into a multi-billion-dollar asset.
With the latest voting updates, Native Markets' proposal is above 70% of the votes committed so far.
— Lilian (@LilianAliaga_) September 11, 2025
With all due respect, I just don’t see how they can turn USDH into a multi-billion stablecoin. And honestly, I don’t get how the vote is swinging so heavily their way.… pic.twitter.com/GhXLwf7nzh
The decision marks Hyperliquid’s most significant governance action to date, decided fully onchain via HYPE token staking.
While the Foundation and Kinetiq (holding 63% of staked tokens) pledged to abstain, the final vote takes place Sunday.
Native Markets’ proposal emphasizes a Hyperliquid-native structure, with reserves managed both onchain and offchain.
Still, concerns over centralization and Stripe’s involvement remain.
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