Stream Finance disclosed a $93 million shortfall earlier in the week, prompting serious concerns
Elixir, a decentralized finance liquidity provider, has shut down operations for its synthetic stablecoin deUSD following a major loss connected to Stream Finance. The decision comes after Stream disclosed a $93 million shortfall earlier in the week, causing a chain reaction across the DeFi ecosystem. Elixir announced on X that it has already processed redemptions for roughly 80% of deUSD holders, but the remaining supply has lost nearly all value, dropping to just 1.5 cents on the dollar, according to CoinGecko.
Elixir has worked tirelessly over the previous 48 hours and has successfully processed redemptions of 80% of all deUSD holders thus far (not including Stream).
As it stands now, Stream holds roughly 90% of the deUSD supply (~$75m), while Elixir holds a similar proportion of its…
— Elixir (@elixir) November 6, 2025
The collapse stems from Stream Finance’s decision to halt withdrawals after revealing the massive loss, reportedly tied to mismanagement by an external fund manager. Stream now faces an estimated $285 million in total debt, with around $68 million owed to Elixir. The unpaid debt left Elixir unable to maintain deUSD’s peg, triggering its rapid decline. Before the crash, deUSD had a market cap of about $150 million and was viewed as a potential competitor to Ethena Labs’ USDe stablecoin.
Stream had borrowed large amounts of deUSD to support its own token, Staked Stream USD (XUSD). Once Stream’s financial troubles surfaced, XUSD also collapsed, at one point trading as low as 10 cents. Elixir reported that Stream still holds nearly 90% of the remaining deUSD supply, valued at about $75 million before the depeg. The company claims Stream has refused to close or repay those loans, effectively leaving Elixir to cover the shortfall.
To mitigate losses for users, Elixir said it is working with decentralized lending protocols like Euler, Morpho, and Compound to compensate deUSD holders where possible. The platform emphasized that redemptions processed before the shutdown were honored at full value. However, the deUSD incident highlights the fragility of synthetic stablecoins dependent on third-party lending structures, adding fresh pressure to DeFi projects built on interlinked debt systems.
