Stream Finance founder sues business partner, accusing them of misappropriating $93 million to cover personal losses

ChainCatcher news, according to DL News, in early November, the Ethereum-based yield protocol Stream Finance reported that an "external fund manager" lost $93 million worth of cryptocurrencies, accounting for about 17% of the entrusted assets. On Monday, Stream's co-founder, under the name Stream Trading Corp., filed a lawsuit accusing Georgia resident Ryan DeMattia of misappropriating the funds to cover his personal losses after defaulting on a personal loan. The lawsuit also accuses Florida resident Caleb McMeans of failing to fulfill the agreement signed when he took over the protocol and brand in January this year. The court is now being asked to enforce the agreement, as McMeans is suspected of shirking responsibility.

The lawsuit details the brief and tumultuous history of the Stream protocol, which operated for only nine months before shutting down in November 2024 due to slowing growth and "operational challenges." After McMeans proposed the acquisition, the agreement stipulated that he would take full control, with Stream acting as a service provider. McMeans was required to allocate fees, assume responsibility, and disclose the flow of funds. However, after several off-chain agreements were reached, it became increasingly difficult to monitor Stream's trading strategies in real time.

In September, the co-founders requested greater transparency, but McMeans kept delaying. He later admitted that he had allowed "employee" DeMattia to invest over $90 million off-chain and had helped DeMattia evade the co-founders' inquiries. McMeans eventually relented, admitting that he had no formal relationship with DeMattia and agreed to withdraw the cryptocurrencies he had entrusted to this "employee."