Decentralized finance platform Stream Finance has suspended all deposits and withdrawals after discovering a $93 million loss in its property. This has added extra gas to the hearth as crypto buyers have raised severe considerations concerning the DeFi market’s sustainability.

Launched in 2024, Stream Finance offers yield-generating DeFi providers like lending arbitrage, hedged market making, and incentive farming. Customers usually deposit USD Coin (USDC), Bitcoin (BTC), and Ethereum (ETH) on the platform in trade for artificial xUSD, xBTC, and xETH tokens, which ship secure returns.

Stream Finance Locks Consumer Belongings After Discovering $93 Million Fund Loss by Exterior Fund Supervisor, Launches Investigation

In a Monday X publish, the Stream Finance crew stated that the difficulty got here to their consideration after an exterior fund supervisor overseeing its funds disclosed the loss on Sunday.

Yesterday, an exterior fund supervisor overseeing Stream funds disclosed the lack of roughly $93 million in Stream fund property.

In response, Stream is within the technique of participating Keith Miller and Joseph Cutler of the legislation agency Perkins Coie LLP, to guide a complete…

— Stream Finance (@StreamDefi) November 4, 2025

The protocol, recognized for providing capital-efficient methods that mix conventional finance (TradFi) instruments with DeFi-led innovation, has since employed legal professionals from blockchain-focused legislation agency Perkins Coie to guide an investigation into the incident.

The crew famous that they’re within the technique of withdrawing all liquid property from the platform, which is predicted to be “accomplished within the close to time period”. They’ve promised to supply stakeholders with “periodic updates as further info turns into obtainable.”

In the course of the investigation, the trade will “quickly droop” all withdrawals and deposits, and won’t course of any pending deposits.

Stream Finance’s xUSD Stablecoin Loses Peg and Tumbles to $0.51; Accomplice Platforms Euler, Morpho, and Silo are additionally at Danger

Stream Finance is a yield-focused DeFi platform that additionally presents a collateralized stablecoin referred to as the Staked Stream USD (xUSD). Nevertheless, xUSD misplaced its parity with the greenback on Sunday, as many customers raised suspicions after the platform paused deposits and withdrawals with none formal communication.

Omer Goldberg, founding father of AI-powered crypto analysis agency Chaos Labs, made a publish on X about 10 hours earlier than Stream’s announcement that its native stablecoin had begun to “depeg materially under its goal vary” after an over $100 million exploit on the automated market maker (AMM) and decentralized trade (DEX), Balancer.

Following the disclosure, xUSD plunged to as little as $0.51. This depegging has additionally affected different artificial property on Stream, similar to xBTC and xETH.

The platform’s customers, who depend upon it for buying and selling and long-term holding, expressed disappointment over sudden fund freezes as they’re prohibited from accessing their collateral property.

Crypto Analysts Elevate Issues About Stream Finance’s Actions, Suspicions of an “Inside Job” Come up

One other regarding admission concerning Stream Finance got here from pseudonymous crypto analyst “YAM”, who identified the complexity in settling claims between holders of xUSD, xBTC, and xETH, and the lenders collateralized by these tokens. 

It is a large loss. It is unclear how this can be settled in between xUSD/xBTC/xETH holders and lenders in opposition to these tokens, so let’s go over all stablecoins/vaults which have (in)direct publicity to Stream.

Greatest we will inform, these stablecoins have oblique publicity:
Elixir’s… https://t.co/QEPsWf1fM2

— YAM 🌱 (@yieldsandmore) November 4, 2025

He additionally warned of oblique publicity to the occasion via different stablecoin vaults like Elixir’s deUSD and Treeve’s scUSD. YAM estimates the entire excellent debt tied to Stream-native property could exceed $280 million, excluding publicity via interconnected lending platforms. Protocols probably affected embrace Euler, Morpho, and Silo, all of which have linked their lending markets to Stream tokens.

To make issues worse, on Friday, the Stream group questioned discrepancies between the entire worth locked (TVL) reported by the platform on its official web site and the numbers listed on the favored on-chain information service DeFiLlama.

Stream Finance went on X to state that DefiLlama doesn’t take into account “recursive looping” as TVL, regardless of their very own definition stating in any other case. In an effort to point out transparency, the crew stated the web site will make a distinction between consumer deposits and whole property deployed throughout its varied methods – reported to be roughly $160 million and $520 million, respectively.

The incident comes only a day after the Balancer v2 exploit, which noticed hackers drain $120 million in liquid staked ETH tokens from the DEX’s core vault linked to its Ethereum, Polygon, Sonic, and Base swimming pools.

Consideration has now turned to the result of the continuing investigation and whether or not Stream will compensate affected customers. The protocol’s future now hangs by a thread, because the inherent dangers of advanced DeFi programs may reignite debates across the lack of trade oversight, protocol transparency, and third-party dependence.