Bitcoin, Ethereum, and several major altcoins extended their November downturn on Monday after a security incident at Yearn Finance triggered renewed fear across the DeFi ecosystem.
Bitcoin and Ethereum Lead the Drop
Bitcoin (BTC) slipped over 3%, falling toward $87,000 during early Asian trading hours. Ethereum (ETH) dropped more than 5%, while major altcoins including SOL, DOGE, and XRP were down over 4%, according to CoinDesk data.
The decline comes after an already painful November close. Bitcoin ended the month with a 17.5% loss, its steepest drop since March. Ether performed even worse, sliding 22%, marking its weakest month since February.
Despite recovering from a brief dip near $80,000 toward the end of November, market sentiment remains fragile.
Yearn Finance Exploit Adds Fuel to the Sell-Off
The latest wave of selling intensified after Yearn Finance (YFI) issued an alert on X about an “incident” involving its yETH liquidity pool. The platform emphasized that its V2 and V3 Vaults were not affected, but the damage was already done.
Blockchain analysts and on-chain chatter suggest the attacker exploited a flaw that allowed them to mint large amounts of yETH in a single transaction, draining the pool of around 1,000 ETH (~$3 million). The stolen funds were quickly routed through privacy mixers.
- Total loss: ~$9 million
- 1,000 ETH sent to Tornado Cash
- Attacker wallet retained approx. $6 million in tokens (PeckShield)
The incident comes shortly after the Korean exchange Upbit suffered a multi-million dollar hack, highlighting a recurring theme in crypto: institutional inflows keep rising, but security remains a weak link.
Mass Liquidations Intensify Volatility
The sudden price drop triggered over $400 million in leveraged long liquidations, per Coinglass. Many traders had positioned for a rebound, only to be caught off guard as prices plunged.
This wave of forced selling added more downward pressure to an already shaky market environment.
ETF Outflows Signal Weakening Institutional Appetite
Another major factor behind the negative monthly performance: declining institutional demand.
- U.S. spot Bitcoin ETFs recorded $3.48 billion in net outflows in November their second-largest monthly redemption ever.
- Ether ETFs bled $1.42 billion, the biggest monthly outflow since launch.
These withdrawals suggest that big investors are stepping back, at least temporarily, from the crypto market.
Bottom Line
Crypto markets are starting December on unstable footing. A combination of weakened institutional demand, major DeFi exploits, and heavy liquidation pressure continues to weigh on Bitcoin, Ethereum, and the broader market.
Until confidence returns particularly in security and ETF flows volatility is likely to remain elevated.
