Hyperliquid's proposed USDH stablecoin has ignited considerable debate within the crypto community, leading to a governance battle to determine the issuer. A validator vote is scheduled for September 14, with key contenders including Paxos, Frax, and a coalition featuring Agora and MoonPay. Concerns are particularly focused on a proposal linked to Stripe, with some community members fearing that ceding control to Stripe would undermine economic sovereignty. Agora's CEO, Nick van Eck, warned against giving up Hyperliquid's canonical stablecoin to a competitor like Stripe, highlighting the risks of conflicts of interest. In contrast, Paxos and Frax are emphasizing regulatory compliance and user yield models, respectively. The deadline for proposal submissions is September 10, and while the current proposals advocate different functional visions for USDH, the stakes are notably high. Whoever wins the contract stands to benefit significantly from issuing a stablecoin that could potentially replace the $5.5 billion in USDC related to Hyperliquid’s supply.

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