The Hyper Foundation has allocated approximately $10 million in grants to support builders affected by the phase-out of the USDH stablecoin. The funding covers migration and wind-down costs as the Hyperliquid ecosystem pivots trading activity toward USDC.
Eligible recipients include HIP-1 and HIP-3 deployers, HyperEVM protocols, USDH bridges, and Native Markets. Native Markets, which won the validator vote to issue USDH in September 2025, beat out larger bidders such as Paxos, Frax, and Ethena. Its original plan aimed to return reserve yield to the ecosystem through HYPE buybacks.
Builders Face July Deadline
HIP-1 deployers handle spot market deployments; HIP-3 deployers handle perpetual markets. Both groups may need support because USDH served as a quote asset or liquidity route for some products. HyperEVM protocols and bridge operators also face direct technical changes. Grant recipients must complete migrations or orderly shutdowns by the end of July.
Users holding USDH must convert balances, close positions, or follow protocol-level migration steps. The official migration dashboard supports USDH-to-USDC and fiat conversions until July 17, while the USDH/USDC spot order book remains available.
USDC Takes Center Stage
The grant program follows Hyperliquid's broader shift toward USDC. In May, Coinbase became the official USDC treasury deployer on Hyperliquid, strengthening USDC as the aligned quote asset. The deal also gave Coinbase the right to purchase USDH brand assets from Native Markets.
According to Native Markets, USDH remains fully backed and maintained, with feeless conversions available for onboarded customers. USDH was originally designed to reduce reliance on external stablecoin issuers and keep reserve yield inside Hyperliquid. But two stablecoin systems can split liquidity and add friction. Moving to USDC simplifies markets and reduces conversion steps.
From Competition to Cleanup
The USDH sunset follows a competitive race that drew wide DeFi attention. Validators voted on the USDH ticker after proposals from Native Markets, Paxos, Frax, and others. USDH later launched in a USDH/USDC pair and recorded over $2 million in early trading.
The new grant plan focuses on cleanup rather than expansion. Builders may need to adjust collateral, update front ends, move liquidity, close markets, or support user withdrawals. The July deadline gives the ecosystem a short window. For Hyperliquid, the grants reduce the risk of unfinished integrations and stranded liquidity, and give builders a financial reason to finish on time. The move shows how stablecoin strategy can shift when venues balance liquidity depth, user experience, and reserve-yield economics.