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FollowingAbracadabra project announced closure: stablecoin MIM is on the verge of collapse due to multiple hacking attacks
It is not uncommon for a company to call itself "Abracadabra"(meaning "magic"), but one cryptocurrency company did adopt the name, supplemented by equally radical financial innovation. Launched in 2021, Abracadabra.money is a crypto project that runs a lending program. The program allows users to deposit interest-bearing crypto tokens as collateral and lend Magic Internet Money (MIM).
Abracadabra's MIM is a stablecoin pegged 1:1 to the US dollar. This stablecoin anchored to the U.S. dollar is considered a digital version of the U.S. dollar. Each stablecoin is backed by liquid U.S. dollar assets, such as U.S. Treasury bonds and cash. Because its value is the same as the U.S. dollar, it is also known as the "digital dollar". The project's plans allow borrowers to deploy borrowed MIM stablecoins elsewhere.
Multiple hacking attacks have put great pressure on MIM stablecoins
However, Abracadabra has often been in trouble and this time finally decided to close its lending process. A $6.5 million hack in January 2024 caused the MIM stablecoin to lose its anchor to the US dollar. Simply put, the attacker took advantage of a loophole in the Abracadabra loan contract to lend out a large amount of MIM without enough collateral. As the stolen MIM was sold off, its price briefly fell from about $0.98 to as low as $0.76.
Another attack occurred in March 2025 and caused approximately US$13 million in losses through loan contracts using agreements. Another shocking incident occurred in October 2025 when a hacker used a vulnerability to steal MIM worth approximately $1.8 million. Abracadabra said no user funds were lost, the vulnerability was fixed, and the impact of the attack was mitigated by using treasury funds to buy back MIM from the market. This only shows that Abracadabra has faced ruthless attacks over the years, which has put tremendous pressure on the MIM stablecoin.
Last month, the Abracadabra team proposed closing lending agreements and MIM stablecoins. The vote ended on September 30 with overwhelming support to approve the closure. The team blamed "a series of hacking attacks" and said MIM lacked sufficient financial support to restore it to fair value. As a result,"orderly" clearing becomes the only way to protect agreement users and MIM holders.
Theteam pointed out: "In other words, the agreement faces approximately US$21 million in non-performing debt, and MIM's effective support rate is below US$0.04 (more than 95% unsupported)."
Solution proposed by Abracadabra
Under the plan, borrowers will receive the value of their collateral minus their MIM debt (US$1 per MIM). In turn, MIM holders will allocate the remaining amount pro rata based on their current MIM balance (approximately US$0.04 per MIM at current exchange rates). In short, once the proposal is implemented, users who expect each MIM stablecoin they can be exchanged for nearly 1 dollar will end up receiving only 4 cents.
整个事件表明，稳定币并不总是稳定的，因为每个代币都需要由等值的资产提供支持。多次黑客攻击确保 MIM 稳定币无法得到完全支持，而 Abracadabra 团队也没有任何手段能让持有者免于损失。
