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Project Overview
Abracadabra is a cross-chain stablecoin lending protocol that allows users to provide collateral in the form of various interest-bearing crypto assets, such as yvYFI, yvUSDC, xSUSHI, and more. With Abracadabra, users can use the interest-bearing tokens they get from staking in vaults as collateral to mint Magic Internet Money (MIM), Abracadabra's USD-pegged stablecoin, and use it for other purposes.
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Abracadabra Plans Orderly Wind-Down of Protocol, MIM Bad Debt Reaches Approximately $21 Million USD
According to The Block, the Abracadabra governance is considering an orderly termination of the SPELL protocol. Related proposals indicate that the protocol currently faces approximately $21 million in MIM bad debt. The proposal recommends liquidating recoverable collateral prior to formal closure and distributing the proceeds to borrowers and MIM holders.
Abracadabra Community Initiates Orderly Protocol Wind-Down and MIM Liquidation Proposal
The Abracadabra community is voting on a proposal for the orderly shutdown of the protocol and its stablecoin MIM (Magic Internet Money). The proposal notes that, affected by factors such as multiple previous hacking attacks, the protocol currently holds approximately $21 million in bad debt. With the circulating MIM supply nearing $22 million and recoverable collateral valued at only around $900,000, the effective asset reserve ratio has fallen below 4%, leaving no viable path to restore the peg.