Bitcoin, Ether, XRP Slide After Yearn DeFi Exploit
Major cryptocurrencies fell in early Asian trading Monday following an “incident” in Yearn Finance’s yETH liquidity pool, extending November’s heavy losses.
Bitcoin (BTC) dropped over 3% to around $87,000, while Ethereum (ETH) fell 5%. Solana (SOL), Dogecoin (DOGE), and XRP each slid more than 4%, according to CoinDesk data.
Yearn’s X alert confirmed an issue in its yETH pool but reassured users that V2 and V3 Vaults remained secure. Reports indicate an attacker exploited a vulnerability to mint a large amount of yETH in a single transaction, draining roughly 1,000 ETH ($3 million), which was routed through mixers.
YETH is a user-governed liquidity pool token made up of Ethereum Liquid Staking Derivatives (LSTs). Blockchain security firm PeckShield reported that the protocol lost $9 million in the exploit, with 1,000 ETH sent to Tornado Cash and the attacker retaining about $6 million in tokens.
The incident follows a multi-million-dollar hack at Korean exchange Upbit, underscoring persistent security vulnerabilities in crypto despite growing institutional inflows.
The early Asian sell-off triggered over $400 million in liquidations of leveraged crypto futures, mostly long positions, according to Coinglass, catching many traders off guard.
November already hit the market hard: Bitcoin fell 17.5% for the month, its worst decline since March, while Ether dropped 22%, its steepest monthly loss since February.
Institutional demand also weakened. U.S.-listed spot BTC ETFs saw $3.48 billion in net outflows in November, the second-largest on record, while Ether ETFs posted a record $1.42 billion in outflows, according to SoSoValue.
The Yearn exploit highlights ongoing risks in DeFi and the broader crypto ecosystem, showing that institutional capital alone cannot fully safeguard the market.
