Elixir Protocol has ended its deUSD stablecoin following significant losses associated with its partner, Stream Finance. Stream Finance owes Elixir over $68 million in debt stemming from a financial blow of $93 million that led to their withdrawal suspension. This incident impacts various DeFi platforms reliant on the deUSD supply, prompting them to pledge 1:1 USDC redemption for affected users. Elixir’s decision comes after a chain reaction triggered by Stream Finance’s financial turmoil. The company is now liquidating their remaining deUSD supply through Euler and Morpho, aiming to address the debt owed to Elixir. 80% of redemption requests have been processed, with those remaining receiving a 1:1 USDC swap. This move marks a significant shift in the DeFi landscape, as many lending platforms are reporting stability following Elixir’s repayment to SuiLend. The incident highlights the vulnerabilities inherent in DeFi mechanisms and underscores the need for robust risk management strategies to ensure market stability.