Decentralized finance platform Stream Finance has halted deposits and withdrawals after an external fund manager reported losses totaling $93 million. The project has engaged legal firm Perkins Coie to investigate the incident and determine responsibility.
According to a statement shared on X (formerly Twitter), the team is in the process of moving all remaining liquid assets away from external custodians. Stream Finance said that updates will be published as soon as verified information becomes available.
The suspension of operations triggered a sharp loss of confidence in the platform’s native stablecoin, Staked Stream USD (XUSD). The token depegged from $1 and dropped to around $0.26, based on data from CoinGecko.
Stream Finance describes its ecosystem as a DeFi yield platform built on recursive strategies and powered by a collateralized stablecoin model. Users had previously reported delayed withdrawals and a lack of communication from the team, suggesting problems were developing before the official announcement.
Omer Goldberg, co-founder of Chaos Labs, noted that the XUSD depeg may be linked to the recent exploit of Balancer, where over $128 million was drained. The timing raised speculation that the two events could be related, though this has not yet been confirmed.
The platform had also been under scrutiny regarding transparency. On October 31, 2025, Stream Finance responded to discrepancies between its reported Total Value Locked (TVL) and the figures shown on DefiLlama, stating that the analytics service does not account for recursive yield loops within its calculations.
Industry analysts say the case highlights ongoing structural risks within complex DeFi strategies, where layers of yield generation and collateral models can obscure underlying exposure.
Minal Turkal, Head of DeFi Ecosystem Development at CoinDCX, commented that users should clearly understand how yield platforms generate returns — and which assets are actually protected.
Earlier, the exchange Bunni also ceased operations following a security breach — further reinforcing concerns over stability and transparency in certain DeFi sectors.
