Yala Stablecoin Crashes 80% Amid $7.7M Exploit

- Yala stablecoin YU de-pegs following a $7.7 million exploit. - On-chain analysis reveals unauthorized minting and USDC siphoning. On September 14, 2025, Yala’s Bitcoin-backed stablecoin YU plummeted by 80% in value, triggering a major de-pegging event. Initially pegged at $1, the stablecoin’s price crashed to $0.20 before partially recovering to $0.79. According to reports from Cointelegraph, Cryptopolitan, and FinanceFeeds on September 14, an exploit was the catalyst for the event. In addition, blockchain analytics firm Lookonchain confirmed significant unauthorized activity. According to a September 14 analysis by Lookonchain, the attacker minted 120 million YU tokens without authorization on the Polygon network. Subsequently, the attacker bridged 7.71 million YU to Ethereum and Solana and swapped the tokens for $7.7 million in USDC. To hide the stolen funds, the attacker then converted the USDC into 1,501 ETH and dispersed it across multiple wallets. Meanwhile, 90 million YU tokens remain on Polygon, and the attacker still controls over 22 million YU on the Ethereum and Solana networks. In response to the exploit, Yala suspended its "Convert" and "Bridge" features to mitigate further risks. The company announced it is working with blockchain security firms SlowMist and Fuzzland to investigate the breach and strengthen security. Yala assured users that all customer funds are secure, emphasizing that its Bitcoin reserves, held in vault-based self-custody, remain unaffected. YU’s price struggled to regain its $1 peg, trading at $0.79 as of September 15. In light of the incident, analysts point to weaknesses in Yala’s cross-chain bridge as a potential vulnerability, drawing parallels to earlier "infinite mint" exploits in the blockchain space. However, Yala has not yet published a detailed post-mortem or a timeline for fully restoring functionality. According to CoinMarketCap data on September 15, YU was trading at $0.79 as of 14:00 UTC, while its 24-hour trading volume had increased by 18.2%.