#HYYY Litepaper

HYYY (pronounced as "Hi") is building USDhy, a next-generation stablecoin that leverages delta-neutral strategies and efficient position management on Hyperliquid's high-performance DEX infrastructure.

#Pushing the Envelope

HYYY provides significant improvements across all three aspects of the stablecoin trilemma:

• Decentralization: Built on Hyperliquid's decentralized infrastructure, HYYY sets a new standard for true decentralization without compromising performance. We firmly believe this model will pave the way for more high-performance DEXs, further strengthening the ecosystem's decentralization.

• Price Stability: Through our delta-neutral strategy, HYYY achieves superior price stability by enabling instant D-0 mint/burn operations. Unlike traditional assets such as bonds which require lengthy settlement periods and complex unwinding processes, or volatile crypto assets that need high overcollateralization, our approach with stablecoin collateral enables immediate position adjustments to maintain stability.

• Capital Efficiency: Our stablecoin-based collateral approach, combined with minimal overcollateralization requirements, ensures superior capital efficiency compared to traditional crypto-collateralized stablecoins.

These innovations work together to create a stablecoin that pushes the boundaries of what's possible within the trilemma constraints.

#Why HYYY Is Different

HYYY is different from other stablecoins in the following ways:

#Yield Optimization: Strategy Over Assets

HYYY's approach to yield optimization represents a fundamental shift in how stablecoin protocols manage positions:

• Dynamic Position Management: Leveraging Hyperliquid's low transaction costs, we actively optimize positions to maximize APY. This agility in position management, which will be further enhanced by future high-performance DEXs, allows us to capture yield opportunities that traditional protocols might find cost-prohibitive.

• Delta-Neutral Freedom: Our delta-neutral strategy liberates us from the constraints of specific underlying assets. Instead of being tied to particular tokens, we focus on the strategic relationships between positions, enabling a more flexible and efficient approach to yield generation. Refer to the section Delta-Neutral Strategy for details.

• Agent-Driven Market Intelligence: Position selection in HYYY leverages advanced AI agents to understand broader market sentiment and trends. Unlike high-frequency trading focused on microsecond advantages, our agents analyze market psychology, on-chain data patterns, and cross-chain correlations to make informed decisions. This comprehensive approach enables more strategic position management with superior risk-adjusted returns. Learn more about our AI architecture in the Agent System section.

Compared to over-collateralized stablecoins or strategy-based stablecoins that only Utilize certain assets, most with single digits APY, HYYY's vaults aims to offer significantly better returns, with the potential to achieve 30%+ APY through optimized positioning and active strategy management.

#AI Vault Managers

HYYY introduces AI Vault Managers - intelligent agents that autonomously manage investment strategies on our platform. This revolutionary approach democratizes access to sophisticated trading strategies, no longer limiting them to traditional finance experts.

Our open agentic framework enables developers to deploy AI managers that:

• Analyze market psychology and sentiment
• Track on-chain data patterns and cross-chain correlations
• Execute strategic position management
• Implement custom risk profiles and strategies

Users can choose from various AI-managed vaults based on their risk appetite:

• Conservative vaults: 6-8% APY through basic delta-neutral strategies and minimal leverage
• Balanced vaults: 15-30% APY using sophisticated strategy combinations
• Performance vaults: 30%+ APY via optimized positioning and strategy stacking

Each vault charges a management fee (typically 10% of yields), with 70% going to vault managers and 30% to the protocol treasury for development and security.

Learn how to construct your own AI manager in the Agent System section.

#The HYYY Ethos

HYYY embodies a new vision for DeFi governance, where community alignment and long-term value creation take center stage. Our governance token represents active participation in shaping the protocol's future, not speculative value.

By making HYYY tokens initially non-transferable, we take a strong stance against token farming and speculation that often plague DeFi protocols. This deliberate design choice ensures that governance decisions come from community members truly invested in our shared success, rather than short-term profit seekers. Our focus is on building a sustainable ecosystem where technical innovation and community interests naturally align, paving the way for genuine decentralization and long-term value creation.

#Risk Factors and Safety Measures

Like any financial system, HYYY faces various challenges across market, technical, and operational dimensions. Market risks include temporary delta exposure during rebalancing and potential liquidity gaps during extreme conditions.

To address these challenges, we've implemented a comprehensive security framework that includes regular audits, real-time monitoring, and automated safety mechanisms. Our system employs conservative position limits and multiple price feeds to ensure stability, while maintaining the ability to pause operations if unexpected conditions arise.

#Roadmap

#Future Development Priorities

Our development strategy focuses on building a robust, scalable, and inclusive protocol:

1. Infrastructure & Security (2025 Q1)
   • Core smart contract development and optimization
   • Comprehensive security audits
   • Public testnet deployment and testing
2. Risk Management & Vaults (2025 Q2)
   • Launch of curated vault system
   • Advanced risk monitoring and automated safety mechanisms
   • Enhanced position management tools
3. Ecosystem Expansion (2025 Q3)
   • Democratized vault management for AI agents and developers
   • Integration with additional high-performance DEXs
   • Expanded liquidity and cross-chain capabilities

HYYY aims to set new standards for stablecoin infrastructure, prioritizing sustainable growth and system resilience over short-term gains.