Downstream Effects of the Stream Debacle

Olivia Capozzalo & Squiffs _
November 18, 2025

gm, Defiers

Today’s big story:

DeFi remains shaken after the Stream and Balancer incidents earlier this month, which lead to widespread contagion across the sector.

In other news:

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📈 Markets in the Past 24 Hours

TICKER	VALUE	24H
Bitcoin	$93,653	0.75 %
Ethereum	$3,146.23	2.97 %
XRP	$2.22	2.89 %
BNB	$936.23	2.52 %
Solana	$140.63	6.52 %

Today’s Big Story

DeFi TVL Plunges 25% Since 10/10

Crypto continues to drop following the whiplash of October, when BTC went from a new all-time high of $125,000 to the most violent leverage wipeout we’ve ever seen in a matter of days.

Following 10/10, the tension in the air was thick as veterans awaited the inevitable fallout from the violent altcoin liquidations. Less than a month later, the first major body rose to the surface in the form of Stream Finance, and immediately after Stream disclosed its $93 million hole, fingers began pointing at risk curators and DeFi solutions that were exposed to Stream.

An old adage in crypto is “don’t trust, verify.” However, the fallout from Stream has shown just how many participants on both the investor and builder sides were doing the opposite.

All things considered, the Stream Finance and Oct. 10 fallout has had a minimal impact in terms of disclosed forced sellers, but trust seems almost irreparably damaged in the crypto community.

Following the collapse of Luna and FTX, most devout DeFi believers and those who are still here today felt that the damages done to the industry were isolated events, and while both had brutal impacts on asset prices and subsequent regulatory crackdowns, the general sentiment was that those liquidations were the result of a few bad actors.

Post-10/10 however, the tune has been different. Altcoins across the board, no matter how long they have been around, got completely wiped out. ATOM, the native token of the Cosmos ecosystem, wicked to basically zero on Binance. The token fell from above $4 to as low as $0.001 on that day, leaving pretty much all perp positions either liquidated or auto-deleveraged.

ATOMUSDT - Binance

Basis trades were unwound, hedges got blown out, and a majority of traders running any portfolio strategy other than “spot and chill” felt the effects in a matter of minutes.

DeFi in particular has suffered from a lack of trust, as users question whether the risk of a few extra percent and some airdrops is actually worth it. In the weeks after 10/10, the total DeFi TVL fell by 11%. Since Stream disclosed its insolvency, total DeFi TVL has fallen by another 16%, albeit aided by the broader market’s bearish price action.

All in all, total DeFi TVL is down more than 25% since 10/10 to $125 billion from $170 billion.

Crypto and DeFi are no strangers to high risk and volatile moves; however, as the industry becomes more regulated and institutionalized, the life-changing returns of previous years by executing degenerate DeFi strategies and meta trading have subsided, leaving many users with a lot of money in the system, while upside feels more capped than ever.

Squiffs, resident degen at The Defiant

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