The global cryptocurrency market experienced a sharp sell-off, with Bitcoin and Ether dropping more than 5%, following a security breach targeting the decentralized finance (DeFi) platform Yearn Finance. The incident, involving a type of attack that many believed had become less common, reignited investor concerns across the crypto sector.
The accelerated decline in Bitcoin and other digital assets began late yesterday, coinciding with news of the hack. Unlike recent corrections driven by broader market risk-off sentiment, this downturn was largely contained within the crypto ecosystem.
Yearn Finance Hack Details
The attack on Yearn Finance was confirmed as a computer exploit in which an attacker issued a virtually unlimited quantity of the platform’s proprietary token, yETH, in a single transaction—estimated at roughly 235 million units.
The flood of tokens destabilized Yearn Finance’s token structure, creating a major liquidity shock. Reports indicate movements of approximately US$2.8 million involving the token just before the funds were transferred to other platforms. The incident underscores persistent security vulnerabilities in the crypto industry, coming on the heels of Upbit—a major South Korean exchange, reporting a US$30 million hack last week.
Market Impact and Accumulating Losses
The breach weighed heavily on investor sentiment, contributing to steeper declines in Bitcoin and Ether compared to broader risk assets. In early European trading, Nasdaq futures limited losses to under 1%, while Bitcoin and Ether fell more than 5%.
Bitcoin unwound much of its rally from last week, dropping to around US$86,000 from nearly US$92,000 on Sunday, as previously reported by MBN. The decline brings it closer to the seven-month low of US$82,000 reached on Nov. 21.
Ether also lost the US$3,000 threshold, retreating toward US$2,800 just one day after nearly touching US$3,050.
Year-to-date losses have deepened for the two largest cryptocurrencies, with Bitcoin now down about 7% and Ether down 14%. Losses across major altcoins—including XRP, Solana, Dogecoin, Cardano, Hyperliquid, and Stellar—also exceeded 5% during the session.