Abracadabra Proposes Winding Down MIM at Four Cents on the Dollar
Abracadabra is proposing to wind down its Magic Internet Money (MIM) stablecoin through a Snapshot vote that would liquidate the protocol, convert remaining collateral to ether, and distribute proceeds pro rata to MIM holders. The team estimates roughly $900,000 of recoverable backing remains against about $21 million of bad debt, implying a payout near four cents on the dollar.
Why It Matters
If approved, the plan would effectively end the MIM stablecoin and crystallize large losses for holders and creditors, marking a notable liquidation of a previously active DeFi money-market protocol. The scale of unrecoverable debt relative to remaining backing highlights risks around collateral valuation and lending exposure in DeFi.
Key Facts
- Proposal method: Snapshot vote to liquidate the protocol
- Planned actions: Swap remaining collateral into ether and pay MIM holders pro rata
- Estimated recoverable backing: $900,000
- Estimated bad debt: $21,000,000
- Implied payout to MIM holders: Approximately four cents on the dollar
Abracadabra has put forward a plan to wind down its Magic Internet Money (MIM) stablecoin through a community Snapshot vote. Under the proposal, the protocol would be liquidated, remaining collateral would be converted into ether, and the resulting funds would be distributed pro rata to MIM holders.
The team behind the protocol provided an estimate of the protocol's financial position, saying roughly $900,000 in backing is recoverable while around $21 million of outstanding loans are considered bad debt. That gap between recoverable assets and liabilities leads to the calculation that MIM holders would receive only a small fraction of their claims — about four cents for each dollar of MIM.
If the Snapshot vote passes, the liquidation and swaps would be executed according to the proposal's mechanics, with distributions made in ether. The proposal represents a formal move to close the protocol and settle remaining obligations rather than attempting further recapitalization or rescue measures.
The proposal and the accompanying estimates underscore the scale of losses tied to the protocol's lending positions and collateral shortfalls. A community-approved liquidation would finalize those losses and return whatever residual value can be extracted to token holders on a proportional basis.
Keep Reading
Robinhood Begins US Crypto Perps Rollout With Up to 10x Leverage
Tether is a ‘lifeline’ for Iranian regime, Senate Dems say in new report
The restaking gold rush is over, and top protocols are barely making a profit
