Welcome to The Chopping Block – where crypto insiders Haseeb Qureshi, Tom Schmidt, Tarun Chitra, and Robert Leshner chop it up about the latest in crypto. This week, we’re joined by Guy founder of Ethena as a special guest, as a single ticker (USDH) sparked a weeklong spectacle: Hyperliquid’s “Bake-off” to award the USDH stablecoin brand. Native Markets surged ahead as validators signaled support, Paxos rallied late with partners and incentives, and Ethena ultimately withdrew. Was this always a vibes‑based beauty contest, or a deliberate move to pressure Circle and re‑route bridge yield? We parse the incentives, the governance, and the market microstructure — and peek at what happens if every big chain/app tries the “native stablecoin” playbook.

Show highlights
🔹 Hyperliquid RFP, Explained — Validators signaled early; stakers could migrate; the USDH “ticker” confers no explicit fee rights, yet bidders offered huge economics.
🔹 Why Native Won — “Vibes-based beauty contest”: homegrown team fit the HL ethos; speed, alignment, and community trust trumped external credentials.
🔹 Paxos Allegation — Late claim of validator bribery surfaced; Paxos denied; no receipts provided; underscores governance fragility to extra‑protocol incentives.
🔹 The Real Prize — Bridge control & yield capture (+ tail‑risk management) mattered more than a brand: even a “just a ticker” beachhead can evolve to real economics.
🔹 Masterstroke Marketing — The public Bake-off dragged every major issuer onstage, boosting HL mindshare and potential leverage in any USDC negotiation.
🔹 Open vs. Closed — If you want a native team, say so; calling it an “RFP” for service providers while preferring insiders created dissonance and drama.
🔹 Odds vs. Votes — Polymarket odds rapidly converged on Native despite splashy rival bids—perception and validator reality diverged from Twitter takes.
🔹 Issuer Margins Compress — Public bids commoditize stablecoin issuance; expect 5–15 bps “asset‑manager” style economics unless you’re Tether‑scale.
🔹 App/Chain Rent Wars — Who captures the float? Apps, wallets, and chains will increasingly demand economics for distribution; UX and liquidity fragmentation loom.
🔹 Liquidity Gotchas — Forcing a nonstandard stable can impair quotes vs. USDT pairs elsewhere; exchanges risk killing their golden goose to save a few bps.