What is Magic Internet Money?
MIM is a stablecoin pegged to the USD, and it is created by the decentralized platform called Abracadabra.money. In order to mint MIM, Abracadabra utilizes interest-bearing tokens as collateral. As of February 2022, various interest-bearing tokens such as liquidity provider (LP) tokens from Convex, Curve, Yearn, and others can be used as collateral.
Unlike other stablecoin and lending protocols like MakerDAO, Abracadabra has a unique liquidation process for each collateralized debt position (CDP). Each CDP has its own liquidation price. If the liquidation price of a specific CDP is reached, a liquidator can acquire the position by repaying the outstanding MIM amount.
The stability of MIM's peg is maintained through arbitrage incentives within the Abracadabra ecosystem. When the price of MIM falls below $1.00, arbitrageurs are motivated to purchase MIM at a discounted price and potentially use it to pay off their debt at a lower cost compared to if MIM were priced at $1.00. On the other hand, when the price of MIM rises above $1.00, arbitrageurs are encouraged to borrow MIM and sell it at a premium.
History of MIM
According to 'Squirrel,' the anonymous co-founder of Abracadabra, the concept of Magic Internet Money (MIM) emerged from the need for a decentralized stablecoin that could outperform existing alternatives. The goal was to create a stablecoin that is fully decentralized, effective in a multi-chain environment, and user-friendly.
Squirrel believes that many stablecoins have lost sight of the core values of decentralized finance (DeFi), using DAI as an example of an unappealing stablecoin. This judgment is primarily based on the common practice of collateralizing decentralized stablecoins with centralized stablecoins, which Squirrel finds absurd.
This trend is not limited to a specific case but has become widespread in both traditional yield farming and conventional decentralized stablecoins in today's world. A closer examination of current decentralized exchanges (DEXs) helps illustrate Abracadabra's viewpoint. It is in response to these observations that the Abracadabra protocol was created, with Magic Internet Money (MIM) serving as its native asset.
Magic Internet Money (Ethereum) Price Analysis
As of November 24 2024 Magic Internet Money (Ethereum) has a marketcap of $55M.
This is {{percentagefromath}} from its all time high of $1.19.
In terms of its tokenomics, there's a total supply of 182M with 31% currently outstanding.
Keep in mind Magic Internet Money (Ethereum) has a fully diluted value of $182M which many investors might interpret as overvalued.
Of course, don’t trust price predictions alone, always check the Coinrotator token screener to follow the trending market.
Summarized in part by ChatGPT 4 and Claude
