DeFi’s Delicate Network: Elixir Recovers Following $93M Crash
- Elixir opens USDC redemption for deUSD after Stream Finance's $93M loss triggers 77% depeg. - 80% of deUSD holders redeemed tokens; remaining processed via claims portal as minting halts to prevent liquidation risks. - Elixir partners with Euler, Morpho, and Compound to liquidate Stream loans, pending legal creditor prioritization. - DeFi contagion prompts Compound to pause stablecoin markets, highlighting systemic risks in cross-protocol lending. - Elixir asserts full liability backing but underscores f
Elixir, a decentralized finance liquidity protocol, has introduced a 1:1
The crisis started on November 4 when Stream Finance, a decentralized lending service, revealed that an external fund manager had lost $93 million in user funds, causing xUSD to lose its peg by 77% and drop to $0.26, as reported by
Currently, Stream holds nearly 90% of the deUSD supply (around $75 million), and most of Elixir’s remaining collateral is tied up in Morpho loans to Stream, according to an
The incident has had a ripple effect throughout DeFi, leading Compound to temporarily suspend several stablecoin markets on
Despite the turmoil, Elixir insists that all deUSD obligations are fully collateralized and that redemptions will be honored at face value. The protocol’s response highlights the vulnerability of synthetic stablecoins that depend on complex collateral structures, as trust in unbacked DeFi assets continues to decline, a point also raised in the FinanceFeeds report.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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