ListaDAO begins forced liquidation of USDX to stabilize protocol and mitigate risk
Alyssa Davidson
Posted: November 7, 2025 9:50 AM Updated: November 7, 2025 9:09 AM
Correction and fact check date: November 7, 2025, 9:50 AM
briefly
Following the decisive vote on LIP022, ListaDAO has partnered with Re7Labs to initiate a liquidation process to stabilize the protocol, reduce risk, and protect the community.
ListaDAO, a decentralized finance (DeFi) protocol, announced that following the overwhelming vote in favor of LIP022, the protocol has begun a liquidation process to reduce uncertainty and protect its operations. This decision reflects our joint efforts to protect the community and maintain stability within the protocol.
This process is being conducted in collaboration with Re7Labs, a company specializing in DeFi and risk-focused research and development. Re7Labs has taken proactive steps for the benefit of its users, highlighting their expertise and transparency in ensuring a smooth and clear resolution of the protocol.
Liquidation is now almost complete and final settlement data is being verified. A portion of the liquidation penalty is held in a protocol account, and these funds are used to redeem collateral once all calculations are complete. Any positions that remain volatile after this step will be transferred to a public liquidation pool, allowing participation from the wider community. We also adjusted the USDX/USD1 market interest rate to 3% as no additional interest will be accrued during the liquidation period.
Recently, the USDX/USD1 market has experienced consistently high leverage rates with minimal repayment activity from borrowers, raising community concerns about potential risk exposure. To mitigate these risks and stabilize the protocol, Re7Labs has formally requested ListaDAO support for forced liquidation. These interventions are intended to minimize losses, preserve market integrity, and maintain overall ecosystem stability.
USDX plummeted below $0.60 following the balancer exploit.
USDX, a synthetic stablecoin issued by Stable Labs, experienced a depeg on Thursday. The token, which previously had a peak circulating supply of $683 million, is currently trading below $0.60, raising concerns about potential ramifications across the protocols where the token is utilized.
USDX uses a delta-neutral hedging strategy on the exchange to maintain the peg, but the exact cause of the depeg remains unclear. Analysts suggest this could be related to the $128 million Balancer exploit that occurred on November 3. This exploit could have forced the liquidation of Stable Labs’ hedged BTC and ETH positions, causing a surge in redemptions and preventing the stablecoin from maintaining its intended value.
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About the author
As MPost’s resident journalist, Alisa specializes in the broad areas of cryptocurrencies, zero-knowledge proofs, investing, and Web3. With a keen eye for new trends and technologies, she provides comprehensive coverage to inform and engage readers about the ever-evolving digital financial landscape.
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As MPost’s resident journalist, Alisa specializes in the broad areas of cryptocurrencies, zero-knowledge proofs, investing, and Web3. With a keen eye for new trends and technologies, she provides comprehensive coverage to inform and engage readers about the ever-evolving digital financial landscape.
more articles