HypurrFi
HypurrFi is the debt infrastructure powering Hyperliquid's financial ecosystem, providing lending markets, synthetic dollar tooling, and cashflow-enabled credit products.
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What is HypurrFi?
While traditional lending protocols like Aave or Compound focus on isolated supply/borrow mechanics, HypurrFi is designed around capital efficiency through leverage loops and synthetic dollar minting.
Core mission: Provide the debt rails that make sophisticated onchain finance possible—from leveraged trading to real-world asset financing to everyday spending.
What Makes HypurrFi Different
Traditional Lending: Deposit → Borrow → Manual strategies
HypurrFi: Deposit → Borrow → Loop for leveraged spot exposure → Mint synthetic dollars → Deploy across ecosystem
The key differentiators:
Intuitive UX: Quick deposit/borrow interface with clear dashboard showing real-time position health, yields, and net performance
Clean leverage loops: Amplify your HYPE/stHYPE yield while maintaining 100% spot position exposure—no complex strategies needed
E-Mode: Achieve higher borrowing power by grouping assets with correlated risks (stablecoins, liquid staking tokens)
USDXL synthetic dollar: Mint dollars directly from your lending position without requiring suppliers, enabling capital efficiency unavailable in traditional protocols
UST Reserve backing: Protocol profits continuously acquire tokenized US Treasuries as additional security for USDXL—creating a hybrid backing model unique to HypurrFi
Integrated ecosystem tools: Credit card spending, cross-chain bridging, and trade aggregation built directly into the lending experience
Catflow philosophy: Capital isn't meant to sit idle—HypurrFi creates incentives for productive capital deployment across the entire Hyperliquid ecosystem, generating yield not just for users but for DeFi protocols across the chain
USDXL: Hybrid Synthetic Dollar
USDXL is HypurrFi's native synthetic dollar—a scalable stablecoin designed for capital efficiency across Hyperliquid. Unlike traditional stablecoins, USDXL is minted on-demand from your collateral without requiring a supply side, and is backed by both user overcollateralization and a growing reserve of tokenized US Treasury bonds.
How USDXL Works
USDXL follows a mint-and-burn mechanism integrated into HypurrFi's core lending markets:
Mint: Supply collateral (HYPE, stHYPE, stables) → Borrow USDXL at $1.00 protocol value → USDXL created on-demand
Burn: Repay borrowed USDXL + accrued interest → USDXL removed from circulation → Collateral unlocked
No suppliers: Unlike traditional lending assets, USDXL doesn't require lenders—it's minted directly when borrowed
Interest flows: All USDXL borrow interest → DAO treasury + UST reserve (no supplier split needed)
Critical distinction: While USDXL always trades at $1.00 within HypurrFi protocol, market price may fluctuate. This creates natural arbitrage opportunities that maintain peg stability.
UST Reserve Backstop
What makes USDXL "hybrid-backed":
Primary layer: Overcollateralized user deposits (standard CDP model)
Reserve layer: Protocol profits continuously acquire tokenized US Treasury bonds (UST)
Reserve functions: Emergency backstop, yield stabilizer, long-term revenue generator
This creates a flywheel effect: Protocol revenue → More UST acquired → More yield generated → Stronger peg → More user confidence → Higher usage → More revenue.
USDXL V2: Current Stability System
V2 introduces three mechanisms to maintain peg while enabling scale:
1. Dynamic Rate Controller
Automatically adjusts borrow rates based on real-time market conditions:
Tracks 48-hour trailing average of USDT0 borrow rates as baseline
Monitors real-time USDXL price from Pyth oracles
Target price: $0.998 (where USDXL rates should match USDT0)
Rate behavior:
Price drops below target → Borrow rate increases exponentially (discourages minting, reduces supply)
Price near target → Rate tracks slightly above baseline
Price above target → Rate drops below baseline
At $1.00 exactly, borrowing USDXL becomes cheaper than USDT0
Rate changes are gradual (20% of gap per adjustment) to avoid sudden shocks.
2. Reflexive Fee Distribution
Creates positive incentives for peg support instead of just punishing borrowers:
USDXL borrow fees → Flow directly to USDXL/hyUSDT0 Balancer LP pool depositors
Price drops + rates increase → LP rewards automatically increase
Natural arbitrage opportunities emerge to buy USDXL and restore peg
Result: When USDXL needs support most (below peg), those providing that support (LPs) get rewarded most.
3. Global Stability Module (GSM)
Captures value during upward deviations to support downward pressure:
Mint: Swap 1 USDT0 → 1 USDXL when market price trades above $1.00
Redeem: Swap 1.02 USDXL → 1 USDT0 (provides natural selling pressure below peg)
All GSM funds deployed into USDT0 lending market earning interest
Creates profitable arbitrage while building treasury reserves
Traditional arbitrage still works: Mint USDXL from lending markets at $1.00 → sell at premium, or buy cheap USDXL → repay debt and save money.
USDXL Use Cases
Leverage loops: Deposit HYPE → Borrow USDXL → Buy more HYPE → Repeat for amplified yield while maintaining spot exposure
Better than USDT0 for loops: USDXL has no liquidity caps (minted on-demand vs limited by suppliers), often cheaper rates (no supplier split + dynamic controller), and scales infinitely during high-demand periods when USDT0 utilization spikes
Profitable arbitrage: Earn by helping maintain peg stability
Credit Card: Spend Without Selling
HypurrFi's Swype Card (via Brahma) lets you spend crypto without selling—accepted at 100M+ merchants globally.
Two modes:
Credit Mode: Purchases create USDT0 borrows against your HypurrFi collateral—crypto stays deposited earning yield
Spend Mode: Deposit USDT0, earn lending rates, spend the balance directly
Why it matters: Stay long HYPE while accessing spending power for everyday purchases.
Bridge: Cross-Chain Deposits
The HypurrFi bridge enables instant routing from multiple EVM chains directly into HyperEVM, powered by Enso and Stargate. No more manual bridging—deposit from your preferred chain and start using HypurrFi immediately.
Team & Development
Led by co-founders @andyhyfi and @androolloyd, HypurrFi takes a measured, user-focused approach to growth. The protocol prioritizes long-term stability over rapid TVL expansion, building trust through robust systems designed for institutional scale.
Resources
HypurrFi provides the debt infrastructure for Hyperliquid's financial ecosystem—enabling leveraged lending, synthetic dollars, and cashflow-enabled credit for sophisticated onchain finance. Making catflow purrr.
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