Hyperliquid’s HYPE Jumps After Coinbase Expands USDC Role on Network

Issued by Circle (NYSE: CRCL), USDC is the second-largest circulating stablecoin behind Tether's USDT with a market capitalization of nearly $77bn, according to DeFiLlama. USDH is the native stablecoin of decentralized perpetuals exchange (perp DEX) Hyperliquid. USDH was developed by Native Markets, a specialized crypto infrastructure team formed specifically to design the stablecoin.

HYPE traded around $41.50 following the announcement, bringing its market capitalization to nearly $10bn, according to CoinGecko. 

The move will make USDC the primary Aligned Quote Asset (AQA) across Hyperliquid, replacing USDH, as trading activity on the decentralized perpetual futures exchange continues to grow. 

As of 14 May, Hyperliquid remained the largest perp DEX by 24-hour volume, processing $6.16bn in perpetual futures trading volume, according to DeFiLlama. The platform’s open interest stood near $9bn, far ahead of rivals. Over the past 30 days, Hyperliquid recorded more than $176bn in perpetual futures volume.

What's next?

As part of the deal, Coinbase will gain rights to purchase USDH’s brand assets from Native Markets. USDH markets will remain active during the migration period but will eventually shut down, according to a post by Native Markets on X. Users will still be able to redeem or convert USDH into USDC and fiat without fees.

Under Hyperliquid’s newly implemented Aligned Quote Asset v2 (AQAv2) system, most of the income generated from stablecoin reserves is directed back to the protocol.

Ben Nadareski, CEO of Solstice Labs, a protocol focused on yield products on Solana, told Sandmark that while traders may not directly see those payments, the benefits can appear through platform credits, fee rebates, or HYPE-token economics.

Nadareski added that the shutdown of USDH also removes some risks tied to smaller ecosystem stablecoins. 

"Holding a niche ecosystem stable means counterparty risk on a smaller issuer, redemption friction outside the home venue, and stranded liquidity if the project loses momentum," Nadareski said. "USDH supply was stalled at around $100 million against USDC's $5 billion on the same chain."

An important signal

Nadareski said Coinbase’s decision to partner with Hyperliquid is meaningful on its own, regardless of the exact structure of the deal. 

He added that the agreement suggests Coinbase views Hyperliquid as a platform with staying power rather than a short-term trend.

"CEXs ran the perps business unchallenged for most of crypto. Hyperliquid is the first DEX with the latency, depth, and product quality to take real share," Nadareski said. "Coinbase, a CEX that owns the largest US spot business, working with the DEX eating into perps share is its own kind of acknowledgement."