Overview
- The MIM dollar peg collapsed this week and accelerated on Thursday, sending the stablecoin to about $0.50 and prompting emergency action by Abracadabra.
- Abracadabra announced gradual interest-rate increases across all Cauldrons, including deprecated markets, to make holding MIM-denominated debt more costly and speed repayments.
- The protocol also paused direct liquidity incentives and Curve bribes and redirected resources toward restoring the peg after earlier June measures failed to hold.
- Earlier attempts in mid-June included a $100,000 top-up to a new Curve pool and a 140 million SPELL token incentive program, but those steps did not stop the renewed sell pressure.
- The crisis raises contagion risk for Curve liquidity providers who may be left holding depegged MIM, and market watchers say the peg’s recovery now depends on borrower repayments, Curve pool balances, and broader crypto market moves.