- Hyperliquid’s recent deal with Coinbase and Circle to make USDC an aligned asset could generate up to $500 million for the decentralized protocol.
- Experts say other protocols like Jupiter and Polymarket could switch their models and follow Hyperliquid, denying Circle a sizable amount of revenue.
Last week, Hyperliquid announced a new partnership with Circle and Coinbase under which it would wind down its own stablecoin for USDC. This partnership could redefine DeFi, generating up to $500 million for the protocol, but at Circle’s expense, experts say.
As ETHNews reported, under the new partnership, USDC on Hyperliquid becomes an Aligned Quote Asset (AQA) that shares revenue with the protocol. In exchange, Hyperliquid sunsets its USDH stablecoin to push all liquidity via USDC.
Analysts now say that the move was a stroke of genius from the DeFi protocol that could generate up to $500 million in revenue. Ryan Watkins, the co-founder of crypto hedge fund Syncracy Capital, says that Hyperliquid becomes the first to internalize both stablecoin yield and trading fees, the two biggest drivers of revenue in crypto.
The more I think about this Coinbase partnership, the more I believe it is Hyperliquid’s biggest announcement all year.
Stablecoin yield is the largest revenue source in the industry next to trading fees and Hyperliquid is now the first blockchain to internalize both.
This is a… https://t.co/26XUaEM78J
— Ryan Watkins (@RyanWatkins_) May 14, 2026
The move is a departure from the existing model that every other protocol relies on, where Circle and Coinbase keep all the revenue from USDC yield. For context, the protocol facilitates $5-10 billion in daily volume, with USDC now accounting for up to 90%. This makes it the largest decentralized stablecoin platform and one of the more important USDC avenues.
In addition to the raw figures, stablecoin yield also adds some resilience to the protocol’s business model, the analyst points out, stating:
“Yield sharing enables Hyperliquid’s revenue to scale more directly with deposits, rather than just trading volume. And because deposits tend to be stickier than volumes in downturns, this could make Hyperliquid’s buybacks more resilient across cycles.”
In bear markets, volumes dip drastically. Currently, they are down over 50% from all-time highs. However, stablecoin deposits have only dropped 15%.
Watkins believes that this new model could generate up to $500 million for the protocol this year, “and billions in the years beyond as the cryptoeconomy reaccelerates.”
Hyperliquid (HYPE) Gains 17%Â
The Circle deal comes at a time when Hyperliquid welcomed synthetic perpetual contracts tied to SpaceX. The Elon Musk-founded company is expected to IPO within the next four weeks, with a valuation estimated at $2 trillion. Hyperliquid recorded $33 milion in the first 24 hours of trading.
These developments have pushed the HYPE price, defying broader market conditions to surge 17% in the past week as every other major coin dipped. In that period, BTC dropped 5%, ETH lost 7%, while Toncoin slid 15%.
HYPE trades at $48 at press time, jumping 4.2% in the past day despite a 1.7% drop in trading volume to $715 million.
Major industry investors are backing HYPE to outperform most large-cap tokens. Investment manager Bitwise announced Monday that it will be devoting 10% of its HYPE ETF management fee to purchase HYPE for its balance sheet.
Hyperliquid was built different.
As in, 99% of the blockchain’s revenue is used to buy and burn HYPE. It's a community-first model based on this idea: If the protocol succeeds, the community succeeds.
In that spirit, we’re pleased to announce that Bitwise will be devoting 10%… pic.twitter.com/gOnaHkZRni
— Bitwise (@Bitwise) May 18, 2026
