Sky (ex-Maker) Joins Race to Power Hyperliquid’s USDH Stablecoin With $25M Plan

• Sky proposes 4.85% yield on Hyperliquid’s USDH, surpassing T-Bills.
  
• Proposal includes multichain support and GENIUS Act compliance options.
  
• $25M initiative aims to autonomously grow DeFi on Hyperliquid.

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Crypto giant Sky, formerly known as Maker, has entered the competitive bidding to back Hyperliquid’s upcoming USDH stablecoin, promising high yields and multichain flexibility for the decentralized perps exchange.

Sky co-founder Rune Christensen unveiled the proposal on Monday, highlighting the project’s resources and experience in backing major stablecoins. “By using Sky to power USDH, the Hyperliquid community will gain unbeatable advantages that no other stablecoin project can offer,” Christensen stated. Sky currently manages USDS and Dai, the fourth and fifth-largest stablecoins, collectively valued at around $12.5 billion.

Promising Yield and Regulatory Flexibility

Christensen’s proposal outlines a 4.85% return on all USDH held on Hyperliquid, surpassing standard U.S. Treasury Bill rates. USDH could also integrate with Sky’s USDS stablecoin, offering a 4.75% yield to holders while remaining multichain via the LayerZero protocol.

The bid also emphasizes regulatory adaptability. Sky’s proposal allows Hyperliquid to customize USDH to comply with U.S. stablecoin laws under the GENIUS Act, which prohibits yield payments in certain jurisdictions. This flexibility could make USDH more widely adoptable while still generating competitive returns.

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$25 Million to Boost Hyperliquid DeFi Ecosystem

Beyond yield, Sky proposes a $25 million initiative to autonomously grow DeFi on Hyperliquid. The plan includes exclusive tokens with the potential to generate billions in value for the protocol. Such strategic investment demonstrates Sky’s commitment to not just issuing USDH but actively supporting Hyperliquid’s ecosystem growth.

Also Read: 95% Yield to HYPE: Paxos Unveils USDH Stablecoin for Hyperliquid’s Next Era

Sky becomes the fifth major crypto project to submit a bid for USDH, joining Native Markets, Frax, Paxos, and Agora (backed by MoonPay). The Hyperliquid community will vote on proposals following the network’s next upgrade, which has not yet been announced.

Sky’s entry adds significant weight to Hyperliquid’s stablecoin race. With promising yields, multichain support, regulatory compliance options, and ecosystem investment, the bid could set a new benchmark for USDH’s launch. Hyperliquid validators now face a choice between multiple high-profile projects, each vying to define the future of the protocol’s native stablecoin.

Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.

Andrew Chen

I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.