---
title: "Abracadabra Proposes Winding Down MIM Stablecoin at Four Cents on the Dollar"
description: "The DeFi stablecoin Magic Internet Money is facing a total wind-down proposal after losing over 95% of its peg value, with the protocol planning to settle debts at a fraction of their face value."
author: "CryptoResearch AI"
published: "2026-09-30T04:02:44.538Z"
updated: "2026-09-30T04:02:44.539Z"
category: "stablecoins"
reading_time_minutes: 2
content_type: "editorial"
canonical: "https://cryptoresearch.news/news/abracadabra-proposes-winding-down-mim-stablecoin-at-four-cents-on-the"
tags: ["Abracadabra", "MIM", "DeFi", "Stablecoins", "SPELL", "Curve Finance"]
---

# Abracadabra Proposes Winding Down MIM Stablecoin at Four Cents on the Dollar

> Editorial content, written by CryptoResearch.

The DeFi stablecoin Magic Internet Money is facing a total wind-down proposal after losing over 95% of its peg value, with the protocol planning to settle debts at a fraction of their face value.

Abracadabra is moving to shut down its overcollateralized stablecoin, MIM, following a collapse that has seen the token trade at approximately $0.0446 as of mid-September 2026. This represents a decline of more than 95% from its intended $1 peg.

The protocol's decline began to accelerate in June 2026, when the token dropped from roughly $0.74 to between $0.49 and $0.50. This move coincided with broader market volatility that saw Bitcoin fall below $60,000.

In an effort to stabilize the token, Abracadabra increased interest rates across its Cauldron lending markets to encourage debt repayment and reduce circulating supply. The protocol also halted Curve bribes and direct incentives. A $100,000 injection into a Curve pool was also attempted in mid-June, though it failed to halt the downward trend.

By September, the token's market cap had fallen to approximately $4.63 million, with circulating supply estimates ranging between 55 million and 104 million tokens. The proposed wind-down would settle obligations at the current market price of roughly four cents per token, resulting in a loss of approximately 96 cents on the dollar for holders.

The protocol, which launched in 2021, previously experienced a depegging event in January 2024 following an exploit that created bad debt. While the token recovered at that time, the incident exposed structural weaknesses in the protocol's ability to maintain its peg during periods of low confidence.

The potential closure of the flagship product raises questions regarding the future utility of the SPELL governance token. The collapse of MIM also marks the removal of a participant from the Curve Finance ecosystem, where the stablecoin was previously active in liquidity pools.

The failure of MIM highlights the risks associated with decentralized stablecoins, where collateral value can drop simultaneously with a decline in demand. While rate hikes and incentive cuts are intended to manage supply, they can also signal distress and trigger further exits from holders.

## Sources

- [Crypto Briefing](https://cryptobriefing.com/abracadabra-mim-wind-down-proposal/)

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Published by CryptoResearch. Canonical version: https://cryptoresearch.news/news/abracadabra-proposes-winding-down-mim-stablecoin-at-four-cents-on-the