Stream Finance Suspends Operations Following $93M Loss and Investigation

Decentralized finance protocol Stream Finance has disclosed a significant loss of approximately $93 million in its managed assets, leading to a suspension of all deposits and withdrawals. The loss was reported by an external fund manager and has triggered an ongoing investigation led by attorneys Keith Miller and Joseph Cutler from Perkins Coie LLP, emphasizing Stream's commitment to transparency and corporate governance. Concurrently, Stream Finance's stablecoin, Staked Stream USD (XUSD), experienced a severe depeg, falling as much as 63% within a day, which has sparked concerns over the stability of the protocol and its asset management practices. The protocol is actively withdrawing all liquid assets and has promised periodic updates as more information becomes available. Market reactions included heavy selling and loss of confidence, particularly on Arbitrum-based venues, though no direct exploit has been confirmed, with some attributing the price collapse to a trust shock and leveraged positions across multiple blockchains. The incident has also raised questions about transparency and the risks associated with Stream's recursive looping yield strategies and multichain exposure.