TLDR:
- Paxos launched USDH Proposal V2 with PayPal support, HYPE listing, and $20M incentives to expand Hyperliquid globally.
- The proposal sets a TVL-based revenue model, capping Paxos earnings at 5% and linking all fees to HYPE tokens.
- PayPal will integrate USDH across Venmo, Checkout, Braintree, Hyperwallet, and Xoom for global reach.
- Paxos confirmed USDH issuance will expand in Europe, where it remains the only legally authorized stablecoin issuer.
Paxos has moved forward with its plan to expand USDH by releasing Proposal V2. The framework introduces upgrades designed to put the stablecoin in front of mainstream users while linking growth directly to community adoption.
The updates include payment integrations, incentives, and a revenue model tied to liquidity milestones. Backing from PayPal marks the centerpiece of the new plan. According to Wu Blockchain, the rollout signals Paxos’ intent to position USDH at the core of Hyperliquid’s expansion.
PayPal Integration and $20M Incentive Program
Paxos said the new proposal brings USDH into PayPal’s ecosystem.
HYPE, the native token tied to Hyperliquid, will be listed on both PayPal and Venmo subject to regulatory approval. USDH will also be available as a free on and off-ramp within PayPal’s supported markets.
The payments group is set to integrate USDH across Checkout, Braintree, Venmo, Hyperwallet, and Xoom. That network covers peer-to-peer transfers, merchant transactions, mass payouts, and international remittances.
By linking to these channels, USDH could reach hundreds of millions of users worldwide.
The plan also allocates $20 million in incentives to support the HYPE ecosystem. Paxos confirmed these funds will target adoption, liquidity, and trading volume growth across the Hyperliquid network. Incentives are structured to encourage long-term usage rather than short bursts of speculation.
PayPal processed over $1 trillion in transactions last year. By adding USDH and HYPE, Paxos aims to route part of that flow into Hyperliquid. The company said distribution through PayPal gives USDH a launchpad that few other stablecoins can access.
Stablecoin issuer Paxos released the USDH Proposal V2 on September 10, featuring three major upgrades: HYPE listed on PayPal/Venmo, USDH free on/off-ramps, and $20 million ecosystem incentives; Paxos can only earn revenue once the TVL target is met, capped at 5%, with all fees…
— Wu Blockchain (@WuBlockchain) September 10, 2025
TVL-Linked Rewards and Global Expansion
Paxos said its revenue share will only start once USDH’s total value locked reaches $1 billion. Until that point, all yield will flow back into growth.
The share remains capped at 5% once TVL surpasses $5 billion. Importantly, all fees will be paid in HYPE tokens, which Paxos argued keeps incentives tied to the Hyperliquid community.
The proposal lays out a clear structure. In the early phase, 20% of returns are allocated to the AF, with that share increasing as USDH TVL climbs. The ecosystem receives most rewards initially, but the balance shifts toward community funds and buyback revenue as adoption grows.
Paxos also said it is uniquely positioned to expand USDH in regulated markets. It remains the only entity with authorization to issue stablecoins legally in Europe. That approval sets a foundation for scaling USDH into global distribution channels without facing regulatory setbacks.
According to the press release, Paxos plans to build products on top of USDH that allow lending, collateralized loans, and trading across traditional platforms. It also intends to embed an Earn feature through APIs that can plug into consumer apps. These moves aim to place USDH at the center of onchain and offchain financial flows.
