Hyperliquid has secured a groundbreaking deal to capture up to 90% of the reserve yield generated by USDC held on its platform, directing that revenue into buybacks of its native HYPE token.
The arrangement, dubbed Aligned Quote Asset v2 (AQAv2), redirects stablecoin income traditionally retained by Circle and Coinbase.
How the Deal Works
USDC is backed by reserves, primarily short-term US Treasuries and cash equivalents, which generate yield. Historically, Circle and Coinbase kept that yield as revenue. Under AQAv2, Hyperliquid captures up to 90% of that reserve income on USDC within its ecosystem. With roughly $5 billion to $5.5 billion of USDC on the platform, this translates to approximately $135 million to $160 million in annual buyback fuel at current interest rates. If USDC balances grow, estimates suggest that figure could climb to $300 million to $500 million annually.
Coinbase handles treasury deployment for USDC, while Circle manages minting and redemptions. Both companies are also staking $20 million each as validators on the Hyperliquid network. The yield is routed through Hyperliquid's Assistance Fund, which executes the HYPE buybacks, backed by a $30 million repurchase authorization.
What Circle and Coinbase Give Up
Equity analysts estimate the deal will reduce annual EBITDA for Circle and Coinbase by a combined $60 million to $80 million. In exchange, they secure USDC as the dominant quote asset on one of the fastest-growing crypto trading venues, embedding themselves into Hyperliquid's infrastructure layer.
The Buyback Machine
For HYPE holders, the token now benefits from a structured, recurring buyback mechanism funded by two streams: trading fees from the exchange and USDC reserve yield from the AQAv2 deal. At the estimated $135 million to $160 million annual range, these buybacks represent a meaningful share of HYPE's circulating market activity. The $30 million repurchase authorization suggests the program is already active.
Investor Implications
Stablecoin reserve yield has been the exclusive domain of issuers since USDC launched in 2018. Hyperliquid's deal breaks new ground by capturing that yield for a platform token. However, the buyback program is directly tied to interest rates. If the Federal Reserve cuts rates aggressively, that $135 million to $160 million estimate shrinks proportionally. Concentration risk also exists in tying a significant portion of HYPE's value proposition to a single counterparty deal. Any renegotiation, regulatory challenge to USDC's reserve structure, or deterioration in the Circle-Hyperliquid relationship could unwind the thesis. USDC balances on Hyperliquid serve as a leading indicator of the flywheel's momentum.