Abracadabra proposes winding down MIM at four cents on the dollar

Magic Internet Money is living up to the first word in its name. Abracadabra’s overcollateralized stablecoin, MIM, has been trading at roughly $0.0446 as of mid-September 2026, a 95%-plus decline from its intended $1 peg. The protocol is now floating a proposal to wind down the token entirely, settling outstanding debts at a fraction of their face value. From depegging to death spiral MIM’s troubles didn’t start overnight, but they accelerated fast once they began. In June 2026, the stablecoin slipped sharply from around $0.74 to roughly $0.49 to $0.50, triggered in part by broader market turmoil as Bitcoin fell below $60,000. Abracadabra’s response was textbook crisis management for DeFi. The protocol raised interest rates across its Cauldron lending markets, hoping to incentivize borrowers to repay their MIM-denominated debt and reduce circulating supply. It also cut direct incentives and stopped paying Curve bribes, the liquidity mining rewards that had helped keep MIM’s peg stable through demand in Curve Finance pools. The protocol even injected roughly $100,000 into a Curve pool as a stabilization measure in mid-June. For a token with tens of millions in circulation, that was ...