Stream Finance Faces $93 Million Wrecked Following the Downfall of Stablecoin XUSD
Stream Finance is currently facing a crisis after it was disclosed that an external fund manager incurred a wrecked of approximately $93 million from the platform’s assets. This revelation sent ripples of alarm throughout its ecosystem, prompting a swift price drop and causing the value of its stablecoin, XUSD, to drop by nearly 77 percent. The situation has left users in a bind with stalled accounts and a host of unresolved inquiries about how such a significant wrecked came to pass.
The Chain Reaction Leading to the Downfall
As per Stream Finance, the missing funds stemmed from assets managed externally through a variety of yield farming and investment tactics. Once the rekt was unveiled, the network swiftly froze both deposits and withdrawals to mitigate further impact.
Stream Finance has reported a wrecked of $93 MILLION Dollars.
Stream Finance was featured on the Taiki Maeda channel.
A young man, highlighted in the interview, had grown an account from a very modest beginning.
— yourfriendSOMMI
The repercussions were severe. XUSD, which is intended to maintain a $1 value, dropped to around $0.30. The platform’s total value locked also fell from about $204 million at October’s close to merely $98 million. In the DeFi realm, this level of decline is sufficient to shatter confidence in an instant.
The Downfall Explained
Stream’s operational model relied on users depositing collateral, cash, or cryptocurrencies, which were then directed into a range of strategies, encompassing market-making and lending. When the fund manager improperly handled or lost assets, the collateral underpinning diminished significantly.
Yesterday, an external fund manager managing Stream funds admitted to losing around $93 million in assets.
In response, Stream has engaged Keith Miller and Joseph Cutler from the law firm Perkins Coie LLP to conduct a thorough…
— Stream Finance (@StreamDefi) November 4, 2025
Lacking adequate support, XUSD’s peg collapsed, and fear quickly spread through the community. The intricate web of leveraged positions exacerbated the rekt, showcasing the vulnerability of Decentralized finance systems when transparency is absent.
DISCOVER: Best New Cryptocurrencies to Invest in 2025
The Impact on Decentralized finance
This incident has once again highlighted the susceptibility of yield-focused Decentralized finance protocols. Investors are becoming aware of how swiftly situations can spiral out of hand when protocols depend greatly on external fund managers and aggressive tactics. What began as an isolated incident has transformed into a cautionary narrative spanning the industry.
As withdrawals continue to be suspended and confidence falters, other DeFi initiatives are preparing for increased examination regarding risk management and the transparency of reserves.
Legal Actions and Recovery Efforts
Stream Finance has commissioned the law firm Perkins Coie LLP to conduct an independent inquiry into the events. The platform has expressed its commitment to reclaim all feasible assets and investigate the circumstances surrounding the $93 million rekt.
Additionally, it has made public plans to withdraw any remaining liquid assets while suspending regular operations until the inquiry is complete. Users are now anticipating updates on whether any portion of the funds may be recovered or if the external manager responsible will be identified.
DISCOVER: 20+ Next Crypto to Explode in 2025
A Greater Insight for Crypto Investors
The Stream Finance incident illustrates how swiftly stability can vanish in decentralized systems that lack oversight. Greater returns frequently accompany hidden risks, and the decline of XUSD from $1 to 30 cents serves as a stark reminder of this reality. Even in the absence of a breach or exploitation, ineffective fund management can severely impact an entire platform. As the probe proceeds, the $93 million rekt and the 77 percent fall in XUSD’s value will act as another lesson in the developmental challenges within DeFi’s growth.
DISCOVER: 20+ Next Crypto to Explode in 2025
Join The 99Bitcoins Update Discord Here For The Latest Trading market Updates
Key Takeaways
- Stream Finance experienced a loss of approximately $93 million due to an external fund manager mismanaging assets, resulting in the collapse of its stablecoin XUSD.
- Following the rekt, the network froze all deposits and withdrawals as XUSD dropped 77 percent from its $1 peg to about $0.30.
- Stream’s strategies focused on yield-farming and leverage intensified the impact, revealing how delicate Decentralized finance systems can be without complete transparency.
- Perkins Coie LLP has been engaged to investigate the rekt, and Stream Finance has committed to recovering remaining funds if possible.
- The $93 million wrecked underscores the dangers of third-party fund management in DeFi and the immediate need for enhanced risk management and accountability.
The post Stream Finance Loses $93 Million as Stablecoin XUSD Collapses appeared first on 99Bitcoins.
