HLP0, which offers deposits a tokenized representation of hyperliquid’s HLP safe, is confronted with recoil for recording user funds from the multi-sig and bridging Avalanche and Arbitrum Defi protocols instead of contributing to the HLP safe.
HLP0 has locked a total value (TVL) of $ 40 million, but $ 29 million of that capital has been bridged to Avalanche and there is $ 11 million about Arbitrum. The funds are used on two Defi protocols, Aave and Avalanche-based Decentralized Exchange (DEX), Blackhole, according to the Debt profile of the multi-sig.
HLP0 Multi-Sig Debank
Cain O’Sullivan from Hyperdrive marked the activity on X where he said: “This would be great if it still earned income from HLP, but from last week that liquidity has now been withdrawn and it is agriculture on Avalanche.” They said. “If you trust a Mulitsig, they can just do everything they want with your money.”
As a follow -up, O’Sullivan shared that hyperdrive will develop a tokenized HLP itself once the native USDC is switched on on the HyperevM.
HLP0 team responds
The HLP0 team has tackled the claims via Discord. The anonymous protocol leader who is known as “Gigasafu” said that HyperevM’s introduction of the indigenous USDC made the core mechanics of HLP0 as “meaningless” and claims to make use of extra yield options to defeat the APR percentage of HLP.
Gigasafu says that by minting on arbitrum as it does currently, it is permitted for “1: 1” zero-slippage deposits in contrast to most HyperevM native wrappers “, but native USDC makes Minting directly to make HyperevM more feel like a financial press specitve.
“Because USDC is native in HyperevM, it makes more sense for Mint from Hyperevm Direct and implement Corewriter a real decentralized and permissionless/ownerless HLP -Wrapper,” Gigasafu continued.
The proposed solution of the team is to integrate the current HLP0 token with the Corewriter of Hyperliquid and Native USDC CCTP Munts, which would make it theoretically and safe pending an audit.
Native USDC
They also represent HLP0+ token, which is the same scenario as what they claim to run now, where idle backing is in the HLP0 multi-sig and “strategies at the top to beat HLP Apr% (arbitration, AMO and bribery strategies)”.
USDC CCTP is native integrated USDC on the hyperevm from Hyperliquid. Until now, HyperevM USDC would move from Arbitrum to the chain via a multi-sig safe.
With CCTP V2 there will be frictionless USDC transfers between hyperliquid and other CCTP V2 integrated block chains, in contrast to the current down payment and credit mechanism of the chain. Circle has no release date for Native USDC on hyperliquid except “coming soon”.
Double token
Following the new double tok system of the HLP0 team, HLP0 would act as a real and verifiable HLP -Wrapper, while HLP0+ works exactly as HLP0 does now, where the team pushes that it pops up by feeding different Defi strategies.
Gigasafu, who is also in the team of the Sonic-based Dex Shadow, concluded: “You don’t have to do anything if you like this. Continue to use HLP0. If you did not like this in one way or another, I will simply take direct contact with me, I will of course be completely supported.
The TVL from HLP0 did not move today according to Defillama, which indicates that the team does not yet have to process withdrawal requests.
HLP0 TVL – Defillama
The actual HLP safe, which offers liquidity to hyperliquid, praises a TVL of $ 435 million, with an average return of 11% APR in the past month.
