Hyperfluid [HYPE] The stablecoin market is becoming increasingly concentrated as liquidity continues to shift towards USD Coin [USDC] instead of the original USDH.
The trend reflects traders’ preference for deeper liquidity and established settlement assets over newer DeFi-native stablecoins.
Hyperliquid Foundation has provided approximately $10 million in grants to help cover migration costs and keep each of its protocols running smoothly. These are HIP-1, HIP-3, HyperEVM protocols, bridges and native markets.
Additionally, users can exchange their USDH for USDC via the same migration paths, reducing friction during the transition.
According to DeFiLlama, USDC now dominates Hyperliquid’s stablecoin liquidity.
In fact, USDC is responsible for $5.74 billion of Hyperliquid’s $5.96 billion stablecoin pool. Conversely, USDH investments have fallen sharply to just $20 million.
Meanwhile, Tether [USDT] runs around $155 million. These numbers clearly indicate that network effects are supporting USDC’s growing dominance.
This imbalance suggests that network effects are strengthening USDC’s leadership, making it the preferred collateral in spot and perpetual markets. If institutional activity continues to expand, USDC’s dominance could further strengthen.
Otherwise, USDH would need meaningful utility improvements to regain market share.
Protocol activity reinforces the usefulness of HYPE
That orderly migration is already translating into stronger on-chain activity as Hyperliquid continues to expand around its USDC-first model. The shift did not disrupt user participation.
According to DeFiLlama, it enabled a sustained level of approximately 6,932 daily active addresses and more than 315,000 daily transactions. facts.
In the meantime, Perpetual trading volume remained near $2.8 billion, cementing Hyperliquid’s leadership in on-chain derivatives.
The growing business also generates annual fee revenues in the hundreds of millions, creating recurring value for the ecosystem. These fees are increasingly flowing to HYPE through staking, priority fees, buybacks and incentives rather than relying primarily on speculation.
If trading activity and USDC liquidity continue to grow together, HYPE’s long-term value capture could further strengthen. Otherwise, slower network activity may gradually reduce revenue growth.