Elixir deUSD Shutdown Confirmed as Recovery Options Collapse

Elixir has announced it will shut down its synthetic stablecoin, deUSD, after a major loss hit one of its key partners. According to Cointelegraph, Stream Finance suffered a $93 million loss that left about $75 million worth of deUSD stuck inside its system. Because users cannot access those funds, Elixir decided it can no longer support the stablecoin safely.

⚡️ UPDATE: Elixir is sunsetting its synthetic stablecoin deUSD after Stream Finance suffered a ~$93M loss, with about $75M of deUSD trapped in Stream’s fallout. pic.twitter.com/7wC9rvr7b0

— Cointelegraph (@Cointelegraph) November 7, 2025

A Stablecoin Caught in a Larger Failure

DeUSD became popular on many DeFi platforms, especially Stream Finance. Many users placed their tokens there to earn rewards. Over time, Stream held a large share of deUSD’s total liquidity. This made the stablecoin heavily dependent on the platform’s health.

When Stream Finance collapsed, the impact was immediate. Withdrawals froze, and the funds locked inside its vaults could not move. With most of deUSD’s liquidity stuck, the stablecoin lost the support it needed to function.

How the Collapse Created the Crisis

Stream Finance’s loss triggered a chain reaction. Users who had deposited deUSD could not take it out. Liquidity pools across other platforms dried up. Therefore, DeUSD’s backing became unclear, and confidence dropped fast.

The problem grew because such a large amount, nearly $75 million, was trapped in Stream’s system. Without access to that liquidity, Elixir had no realistic way to maintain stability or support normal use of the token. This left the project with very few options.

Why Elixir Chose to Sunset deUSD

After reviewing the situation, Elixir’s deUSD shutdown was decided. The team explained that keeping the stablecoin active would create even more risk for users. Since most of the liquidity is locked with no clear recovery timeline, the stablecoin can’t operate safely.

Elixir is now preparing a transition plan and says it wants to communicate clearly with users as the process continues. The team also hopes to prevent further uncertainty in the ecosystem by acting early instead of waiting for the situation to get worse.

What Users Can Learn From This

The collapse shows how connected DeFi systems are. When one platform fails, the effects spread quickly, especially when a token depends on a single source of liquidity. In this case, Stream’s problems directly damaged deUSD.

For users, this is a reminder to understand where stablecoins keep their backing and which platforms hold their liquidity. For developers, it shows the importance of spreading risk instead of depending too much on one partner.

Why deUSD’s Shutdown Matters

Elixir’s deUSD shutdown is another warning for the DeFi world. With $75 million stuck and no safe path forward, the project chose to end the token rather than allow more damage. The next steps will focus on helping users and rebuilding trust after a difficult and expensive loss.