Coinbase Takes Over USDH-Crypto King Moves to USDC!

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Coinbase Takes Over USDH as Hyperliquid Shifts to USDC

Coinbase is expanding its involvement with Hyperliquid. Native Markets plans to switch the foundation of its USDH stablecoin to USDC and will share treasury management with Coinbase as part of this change.

This change stops Hyperliquid from mainly using USDH and makes USDC the main stablecoin for trading on its platform.

Coinbase Absorbs USDH as Hyperliquid Bets on USDC

Native Markets announced that Coinbase is buying the USDH brand and will officially manage the USDC reserves using Hyperliquid’s new AQAv2 system.

This announcement represents a major change for stablecoins in 2026 and has the potential to significantly alter how leading cryptocurrency platforms distribute revenue to their users.

Hyperliquid’s Stablecoin Strategy Changes

Hyperliquid used to depend a lot on USDC borrowed from other blockchains, with a large amount of money—billions of dollars—available on the platform. However, some people pointed out that most of the profits earned from these funds went to established companies like Circle and Coinbase, rather than staying within the Hyperliquid system.

Things shifted in 2025 when Hyperliquid validators chose Native Markets to introduce USDH, a stablecoin with full backing in U.S. Treasury bonds and cash.

USDH now uses a new system called “Aligned Quote Asset” that aims to boost the Hyperliquid platform. It does this by rewarding traders and contributing funds to a special pool – the Assistance Fund – which is used to buy back HYPE tokens and help the platform grow.

Now, Coinbase appears to be adopting that same framework instead of competing against it.

Native Markets Calls Transition a Win

Native Markets clarified that Coinbase isn’t buying the entire company. Instead, Coinbase is only purchasing the rights to the USDH brand, and Native Markets will continue to operate as a separate entity.

According to co-founder Mary-Catherine Lader, this change proves their belief that stablecoins should benefit users and the broader digital world, not just take value from them.

With the new AQAv2 system, Coinbase is expected to share most of the income earned from interest on USDC balances held on Hyperliquid directly with the Hyperliquid protocol.

This marks a significant change in how stablecoins operate and might encourage other exchanges and decentralized finance platforms to create similar agreements for sharing revenue.

USDH Holders Face Gradual Migration

Native Markets has confirmed that USDH will be fully backed while the system is updated. Users can still exchange their USDH for USDC or traditional currency directly through the official platform, without any fees.

The team will also help ensure there’s enough trading activity for USDH/USDC, while Hyperliquid manages the switchover for its regular and futures markets.

As an analyst, I’ve been monitoring the recent market activity, and the reaction to this move has been quite divided. Some traders on X are calling it a potential ‘cash-out’ or even a ‘rug pull,’ suggesting a negative outcome for investors. However, others view it as a smart play by Hyperliquid and a positive signal for USDC. What’s really interesting to me is that this situation highlights the increasing competition we’re seeing between stablecoins built natively within the DeFi space and those coming from more traditional financial institutions.

What Comes Next for Hyperliquid

The next step focuses on how easily Hyperliquid can move funds and rewards from USDH to markets that use USDC.

Investors are also interested in seeing if the AQAv2 system will become a model for other blockchains, allowing them to keep revenue from stablecoins within their own networks instead of paying it to outside companies.

The collaboration between Coinbase and Hyperliquid has the potential to significantly change how major stablecoin companies work with decentralized trading platforms in the future.

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2026-05-14 15:27