$LiHo_xY_{1-x}F_4$ is an insulating system where the magnetic Ho$^{3+}$ ions have an Ising character, and interact mainly through magnetic dipolar fields. We used the muon spin relaxation technique to study the nature of the ground state for samples with x=0.25, 0.12, 0.08, 0.045 and 0.018. In contrast with some previous works, we have not found any signature of canonical spin glass behavior down to $approx$15mK. Instead, below $approx$300mK we observed dynamic magnetism characterized by a single correlation time with a temperature independent fluctuation rate. We observed that this low temperature fluctuation rate increases with x up to 0.08, above which it levels off. The 300mK energy scale corresponds to the Ho3+ hyperfine interaction strength, suggesting that the hyperfine interaction may be intimately involved with the spin dynamics in this system.
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