Stream Finance Halts Operations After $93M Custody Loss

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In a stark reminder of the risks inherent in decentralized finance, Stream Finance has been forced to suspend all user withdrawals.

The crisis was triggered not by a smart contract hack, but by a catastrophic $93 million loss incurred by an external, centralized fund manager tasked with overseeing its assets.

The incident highlights the often-overlooked vulnerability of “cefi-in-defi,” where protocols rely on traditional finance actors, undermining the decentralized ethos and creating single points of failure.