Key Notes
- The Paxos USDH proposal V2 for Hyperliquid will deliver three upgrade for global scale.
- This includes an integration with PayPal and Venmo, and $20 million ecosystem incentive.
- Paxos is also offering its reputation as a regulated entity to build Hyperliquid.
Financial firm Paxos is set to bring about a revolution in the Hyperliquid ecosystem with its USDH proposal V2. According to a published statement, this proposal will deliver three major upgrades, including a partnership with PayPal and Venmo, that can drive Hyperliquid to the global scale.
Hyperliquid’s USDH to Take Company to Global Scale
At the beginning of this week, stablecoin infrastructure firm Paxos submitted a proposal, seeking to rollout Hyperliquid-first stablecoin dubbed USDH. Based on the announcement, the stablecoin would be fully compliant with the Guiding and Establishing National Innovation for US Stablecoins Act (GENIUS Act) and Markets in Crypto-Assets (MiCA) regulatory standards.
In a follow-up post, it shared three upgrades that will come with the USDH proposal V2. The first one is a PayPal partnership that will see HYPE listed on PayPal and Venmo. Generally, PayPal is known for processing up to $1 trillion in Total Payment Volume (TPV) annually, with over 400 million users, and 35 million merchants. This reputation could scale up the Hyperliquid ecosystem in no time.
It would come with free on/off-ramps for USDH and $20 million ecosystem incentive. This will birth integrations with other global payments across Checkout, Braintree, Hyperwallet, and Xoom.
Another upgrade is revamped rewards with an incentive structure that is capped at 5%.
“Clear AF-first incentive structure with Paxos only earning once TVL milestones are hit,” Paxos wrote, while noting that “all fees taken in HYPE tokens to directly align with the community.”
The other upgrade that this proposal brings to Hyperliquid is Paxos’ reputation as a regulated entity. According to the firm, it is the only entity legally permitted to issue stablecoins. With this autonomy in Europe, there is every guarantee that USDH can scale globally in a fully compliant manner. Therefore, both Paxos and Hyperliquid can win at the same time.
Paxos acknowledged that it has had several entities approach the firm with concerns. At the same time, it noted that it has been able to address these concerns, hence, the introduction of V2. Going forward, the plan is to drive differentiated distribution for the Hyperliquid ecosystem so as to give access to billions of users.
Paxos Caught in NYDFS Regulatory Net
Noteworthy, Paxos powers some of the most sophisticated projects in the industry but this is not without some challenges. In August, Paxos Trust was caught in the middle of some regulatory chaos that eventually led to settlement with the New York State Department of Financial Services (NYDFS). The regulator secured a $48.5 million settlement with the company.
This was for alleged anti-money laundering deficiencies and due diligence failures that were related to the firm’s partnership with Binance. The department cited “lax geofencing restrictions that enabled US users to access an unregulated exchange,” which it claimed allowed $1.6 billion in transactions involving illicit players between 2017 and 2022.
However, Paxos has agreed to invest in the improvement of its compliance program and remediate deficiencies pursuant to a plan approved by DFS.
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Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.
Source: https://www.coinspeaker.com/hyperliquid-paypal-venmo-paxos-usdh-proposal-v2/