MIM loses more than 95% of dollar peg as Abracadabra faces wind-down

  • Abracadabra proposed winding down its MIM stablecoin protocol and distributing recoverable assets to holders.
  • About $900,000 is accessible from $1.2 million in MIM collateral.
  • MIM liabilities rank ahead of SPELL under the proposed wind-down.

Magic Internet Money (MIM), the DeFi stablecoin issued through Abracadabra, has lost more than 95% of its $1 peg after repeated attacks left the protocol severely undercollateralized and unable to restore the token's value. MIM traded around 4.46 cents as of September 2026. Abracadabra has proposed winding down the protocol, liquidating remaining recoverable assets, converting collateral into Ether and distributing proceeds pro rata to MIM holders. The plan identifies about $1.2 million in collateral backing MIM debt, including roughly $900,000 that the protocol can act on and about $300,000 held in an immutable Arbitrum wrapped Ether cauldron that may take years to recover. Against $21 million in bad debt, the recoverable assets imply a distribution of roughly four cents per MIM. MIM liabilities take priority over the SPELL governance token, leaving SPELL with no accounting value unless MIM debt is repaid in full.

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