The USDX stablecoin has experienced a dramatic price drop of over 63%, plummeting from $1 to $0.37 on November 6, 2025, following allegations that its founder, Flex Yang, drained liquidity from DeFi protocols. No official statements were issued by the project team regarding these claims. This event has triggered a ripple effect in the DeFi ecosystem, with several major stablecoins like USDC and USDT experiencing significant liquidity shortages.
A key player in this incident is Flex Yang, who is reportedly linked to the drained funds through on-chain analysis tools. Lista DAO responded swiftly by initiating an emergency proposal, LIP022, for immediate liquidation of USDX-backed positions. The market reacted aggressively, with major DeFi protocols experiencing liquidity woes as a result.
This incident highlights the vulnerability inherent in decentralized finance and raises questions about regulatory oversight. The lack of official responses from both Flex Yang and other related platforms is contributing to heightened market uncertainty, prompting calls for improved risk management strategies within the stablecoin ecosystem.