Ethena has submitted a proposal to issue a new stablecoin, USDH, for the decentralized derivatives exchange Hyperliquid. This move pits Ethena against other established players like Paxos, Agora, and Sky in a competitive bidding process.

The proposed stablecoin would be a new product, USDtb, fully backed by BlackRock's BUIDL tokenized money market fund and issued via the federally chartered bank Anchorage Digital. This structure aims to offer a regulated, transparent, and yield-bearing stablecoin alternative for the Hyperliquid ecosystem.

Under the terms of the proposal, Ethena has pledged to return 95% of the net revenue generated from the USDH reserves back to the Hyperliquid ecosystem, creating a direct economic benefit for the platform.

This development highlights a significant trend of integrating traditional financial assets into decentralized finance, with major players like BlackRock providing the underlying collateral for a new generation of stablecoins. It also underscores the increasing competition among stablecoin issuers to secure integrations with high-growth DeFi protocols.