Paxos updated its bid to issue the USDH stablecoin for Hyperliquid, adding planned support from PayPal, Venmo, and Xoom. The company said PayPal will list the HYPE token, provide free on and off ramps for USDH, and allow checkout with USDH and HYPE. It also disclosed 20 million dollars in incentives for the HYPE ecosystem and stated that its European Union regulatory position enables cross border circulation of the USDH stablecoin. “PayPal has committed to supporting the Hyperliquid ecosystem,” Paxos wrote.
USDH Stablecoin With PayPal and Venmo Integration
Paxos said PayPal will connect the USDH stablecoin to everyday payments. The plan includes free fiat on and off ramps for USDH, which reduce friction for conversions. The company added that HYPE and USDH will appear at PayPal checkout.
The proposal extends reach through Venmo and Xoom. In practice, users could move funds across these apps while keeping settlement in the USDH stablecoin. Thus, Hyperliquid gains distribution without changing user habits inside those wallets.
The filing also includes 20 million dollars in HYPE ecosystem incentives. Paxos attributed this budget to growth of the Hyperliquid economy. The USDH stablecoin remains the core settlement asset across this plan.
The revenue model links Paxos income to total value locked TVL on Hyperliquid. “Paxos only wins if Hyperliquid wins,” the document states. It adds, “Paxos takes nothing until we reach 1B dollars in TVL and stays capped at 5 percent post 5 billion total value locked TVL.”
After 1 billion dollars in TVL, Paxos begins to earn 1 percent of fees. The share increases with assets and reaches 5 percent at 5 billion dollars in TVL or more. “Any fees earned by Paxos through this milestone will be held in HYPE tokens,” the firm said.
Therefore, Paxos ties upside to both TVL and the HYPE token. Holding fees in HYPE aligns the issuer with Hyperliquid activity. The USDH stablecoin stays central to that activity.
Assistance Fund on Hyperliquid and HYPE Token Buybacks
The proposal directs platform revenues to an Assistance Fund. The protocol owned treasury receives revenues and fees. It then conducts market purchases of the HYPE token.
In the early phase, up to 80 percent of funds go to ecosystem development. These funds cover onboarding programs and growth efforts around the USDH stablecoin. Over time, that heavy spend steps down.
As TVL increases, ecosystem spend declines to 25 percent. More revenue moves into the Assistance Fund treasury. The fund then handles buybacks and insurance for the Hyperliquid ecosystem. Source: Paxos.
USDH Stablecoin Competition: Paxos, Stripe, MoonPay, Ethena
Rival bids for the USDH stablecoin surfaced this week. On Monday, a coalition that includes MoonPay, Agora, and Rain submitted a joint proposal. They presented an alternative to an offer tied to an entity indirectly controlled by Stripe.
Agora chief executive Nick Van Eck opposed the Stripe aligned bid. He warned that Stripe vertical integration presented “clear conflicts.” The coalition urged the community to weigh issuer neutrality for USDH stablecoin issuance.
On Tuesday, Ethena Labs became the sixth bidder for USDH. The team behind USDe and USDtb proposed backing USDH with USDtb, which is tied to BlackRock BUIDL. That design would anchor collateral to tokenized cash management assets. Sources: firms’ proposals.
European Union Reach and Compliance Path for USDH Stablecoin
Paxos highlighted its position in the European Union. The company said its regulatory standing allows the USDH stablecoin to circulate in the bloc. Therefore, distribution can scale beyond a single market.
The plan pairs consumer access with regulated rails. By using PayPal checkout and Venmo wallets, USDH could reach large user bases while keeping compliance. This approach keeps Hyperliquid at the center of settlement flows.
The updated bid links Paxos revenue to TVL, sets HYPE token fees, and funds an Assistance Fund. Meanwhile, the USDH stablecoin faces active competition from Stripe affiliated interests, the MoonPay Agora Rain coalition, and Ethena Labs with USDtb and BlackRock BUIDL. Sources: Paxos, firms’ proposals.