⏱ 2 min read
The DeFi lender says MIM has roughly $900,000 of actionable backing for 22 million tokens outstanding; a June asset handover passed with two wallets and now faces scrutiny.
Abracadabra has proposed an “orderly wind down,” saying a series of security incidents left its Magic Internet Money (MIM) stablecoin with “no viable path back to parity,” Protos reported. The governance vote, set to close Wednesday evening, had two votes at the time of reporting: roughly 100 million SPELL for and 0.5 million against, according to Protos.
The proposal cites about 22 million MIM still outstanding against roughly $900,000 of “actionable backing,” implying around $0.04 per MIM — about 4% of par. Protos noted the protocol once managed about $6 billion at its peak.
Separately, Trading Strategy co-founder Mikko Ohtamaa called the situation “treasury looting,” pointing to a June governance decision that transferred asset stewardship to a group “led by Anubis.” Protos reported that the handover passed with just two votes totaling over 5 billion SPELL. Ohtamaa also highlighted sizable treasury sales of MIM on Curve on June 8 and 11 that he said netted about $0.5 million while the stablecoin was already losing its peg.
Mechanically, selling MIM into Curve below $1 can widen the depeg by adding sell pressure to a shallow pool, while concentrated voting power can push through sweeping changes with minimal turnout. When backing is thin and “actionable” collateral limited, those choices directly influence recoveries for remaining MIM holders.
Protos’s timeline underscores compounding operational and market risks. After the 2022 reputational hit tied to 0xSifu, Abracadabra was hit by a $6.5 million hack in January 2024, followed by two more in March and October 2025 of $13 million and $1.7 million, respectively — leaving roughly $21 million of bad debt. Earlier design exposure via DegenBox to UST also erased about $1 billion of TVL in 2022, Protos reported.
What to watch next
- Final wind-down vote outcome and turnout, including wallet concentration in the results.
- Any published wind-down mechanics: how remaining assets are allocated and whether specific redemption terms are offered to MIM holders.
- On-chain movements of Abracadabra treasury wallets and MIM liquidity on Curve, including further treasury sales or market-making activity.
- Statements from Abracadabra contributors and the “Anubis”-led group addressing the June handover and subsequent transfers.
This content is for informational purposes only and does not constitute financial advice.
🧠 HafidWatch Take
A significant increase in voter turnout or broader participation could alter the outcome of the wind-down vote by diluting the influence of the largest holders. While concentrated governance currently controls recovery decisions, surpassing a certain threshold of diverse engagement might enable more equitable distribution of remaining assets. Without this shift, the limited actionable backing and concentrated votes are likely to cement the current power dynamics, determining the final recovery for MIM holders.
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