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Yala's stablecoin YU plummeted to $0.44 on November 17, yet another case of decoupling.



To be honest, this wave is mainly due to the operation issues of the project party. YU itself has designed an arbitrage mechanism to maintain price stability—when it falls below 1 USD, smart money can play it this way: first buy 1 YU from a decentralized exchange for 0.44 USDC, then immediately go to the official website to exchange it back for 1 USDC at a 1:1 ratio. This buy and sell directly profits from the price difference, and theoretically, this influx of arbitrage will pull the price back to the peg.

But the reality is that the mechanism has failed. It may be due to insufficient reserves from the project party or issues with the exchange channels, which prevent arbitrageurs from smoothly completing their closed-loop operations. The most feared situation for a stablecoin to lose its peg is this—no matter how ingenious the design is, if the execution fails, it will still go wrong.
USDC0.02%
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GhostAddressMinervip
· 7h ago
0.44 just thinking about maintaining? Laughable, the project party is simply not prepared for this reserve fund.
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PrivateKeyParanoiavip
· 11h ago
It's the same trap again, insufficient reserves and still daring to play with stablecoins? Just makes me laugh.
View OriginalReply0
AirdropHunterXiaovip
· 11h ago
The arbitrage mechanism is just a facade, where is the reserve fund?
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PhantomHuntervip
· 11h ago
It's this trap again, the reserve funds have long been used for other purposes.
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GateUser-40edb63bvip
· 11h ago
Really, it's the same old trap again. No matter how fancy the design is, it's useless without reserves, and the arbitrage mechanism is essentially a facade.
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