Abracadabra proposes winding down MIM stablecoin after 95% value collapse

The decentralized finance protocol Abracadabra has proposed a wind-down of its overcollateralized stablecoin, Magic Internet Money (MIM), following a massive collapse in value. As of mid-September 2026, MIM has been trading at approximately $0.04, representing a decline of over 95% from its intended $1.00 peg.

The proposal aims to settle outstanding debts at a fraction of their face value, as the protocol acknowledges there is no longer a viable path to restore the peg. The treasury currently holds approximately 22 million MIM against roughly $900,000 in actionable collateral, meaning holders may receive less than four cents for every dollar promised.

MIM’s decline was accelerated by market volatility and a series of incidents, including an exploit in January 2024 that created bad debt. Previous attempts to stabilize the token included raising interest rates in Cauldron lending markets and injecting liquidity into Curve Finance pools, but these measures failed to prevent the downward spiral.