Yala’s YU Stablecoin Crashes to $0.20 After Protocol Attack — Fails to Regain $1 Peg
YU, a Bitcoin-collateralized stablecoin by Yala, dropped to as low as $0.2046 after what’s described as an “attempted attack” on the protocol.
The project has not been able to restore the peg to $1. It’s currently trading around $0.7869.
The attacker reportedly minted 120 million YU on Polygon, bridged some amount to Ethereum & Solana, and sold ~7.71 million YU for ~7.7 million USDC.
Yala says all funds are safe: Bitcoin reserves remain intact and self-custodial or stored in vaults.
As a precaution, Yala has disabled its Convert and Bridge features. Other protocol functions remain active. Security firm SlowMist is assisting in investigating the incident.