Magic Internet Money (MIM), a US dollar-pegged stablecoin of the Abracadabra ecosystem, joins the rising checklist of tokens dropping their $1 worth amid an premature crypto winter. The sudden de-pegging of the MIM token commenced roughly on June 17, 7:40 pm ET, which noticed the token’s value drop to $0.926 in simply three hours.
Terra’s LUNA and TerraUSD (UST) loss of life spiral not solely affected the buyers but additionally had a damaging impression on quite a few crypto initiatives, together with Abracadabra’s MIM token ecosystem — as alleged by Twitter deal with @AutismCapital.
Citing an insider scoop, AutismCapital claimed that Abracadabra accrued $12 million in dangerous debt as a direct results of Terra’s sudden downfall “because liquidations couldn’t happen fast enough to cover the protocol’s MIM liabilities.”
We have a scoop from certainly one of our affiliate autists: MIM (Magic Internet Money) could also be almost bancrupt. MIM is without doubt one of the bigger stablecoins, with a market cap of ~$300M.
We cannot consider {that a} undertaking referred to as Magic Internet Money has been performing irresponsibly both.
Details:
— Autism Capital (@AutismCapital) June 17, 2022
Daniele Sestagalli, the founding father of Abracadabra, nonetheless, refuted the claims of insolvency by guaranteeing to have sufficient funds to pay again the piling money owed — which has been attributed to the falling MIM costs. Sestagalli acknowledged:
“[The Abracadabra] Treasury has more money than the debt and $CRV are valuable for the protocol.”
Doubling down on his stance, Sestagalli additional publicly shared the treasury handle holding $12 million in property whereas asking involved buyers to confirm the identical utilizing on-chain information.
On the opposite hand, Autism Capital alleged that Sestagalli’s dangerous debt was created 5 days in the past and shared the beneath screenshot displaying his dialog about the identical on MIM’s Discord group.
While the chance of insolvency continues to threaten the Abracadabra protocol, both by the MIM treasury persevering with to dump in worth or extra dangerous debt created, buyers are suggested to maintain monitor of market fluctuations and do their very own analysis (DYOR) earlier than making funding choices.
Related: USDD stablecoin falls to $0.97, DAO inserts $700M to defend the peg
Five days in the past, on June 13, Stablecoin protocol USDD’s value dipped to $0.97 on main crypto exchanges.
1/ And it is beginning$USDD is at the moment simply 92% collateralized by the Reserves (even contemplating $TRX funds) ⚠️
If you subtract $TRX, it seems collateralization ratio is at the moment 73%
Also, the 140M $USDT are usually not actually USDT, however jUSDT pic.twitter.com/fKYaIQEd1D
— Res ®️ (@resdegen) June 12, 2022
To assist out through the market fluctuations, the Tron DAO Reserve introduced that it acquired 700 million USD Coin (USDC) to defend the USDD peg. As a results of the fund infusion, the staff behind the stablecoin defined that the collateralization ratio of USDD is now boosted to 300%.