Abracadabra racked up $12 million in toxic loans as a direct consequence of Terra’s abrupt demise, although CEO Daniele Sestagalli rejected this accusation.
The Abracadabra ecosystem’s Magic Internet Money (MIM), a US dollar-pegged cryptocurrency exchange, has joined the growing list of assets shedding their $1 worth due to an unexpected crypto freeze. The de-pegging of the MIM token began at about 7:40 p.m. ET on June 17, and the token’s price has fallen to $0.926 in only three hours.
According to Twitter account @AutismCapital, Terra’s LUNA and TerraUSD (UST) slow decline harmed not just shareholders but also several crypto initiatives, notably Abracadabra’s MIM token network.
According to AutismCapital, Abracadabra racked up $12 million in bad debt at the end of Terra’s abrupt demise “because insolvencies couldn’t materialize quickly to meet the system’s MIM obligations.”
The creator of Abracadabra, Daniele Sestagalli, rejected the allegations of bankruptcy by making sure the company had sufficient finances to pay off the mounting liabilities, which had been blamed on dropping MIM costs. According to Sestagalli,
“[The Abracadabra] Treasury has more money than it owes, therefore, $CRV is important to the protocol.”
Sestagalli doubled back on his stance by publicly sharing the storehouse account, which held $12 worth of assets and urging worried investors to double-check the information using on-chain statistics.
Autism Capital, on the other hand, said that Sestagalli’s huge loans were generated just days back and published a screenshot of his communication about it on MIM’s Discord channel.
Traders are encouraged to continue track of market movements and conduct their own investigation (DYOR) before investing in a company while the possibility of bankruptcy keeps threatening the Abracadabra procedure, whether through the MIM treasury continuing to drop in value or more bad debt being generated.
The price of Stablecoin network USDD dropped to $0.97 on a key cryptocurrency exchange five days ago, on June 13.
The Tron DAO Reserve reported that it had acquired 700 million USD Coin (USDC) to assist preserve the USDD peg amid market moves. The stablecoin’s collateralization ratio has been increased to 300 percent in the number of the capital injection, according to the team behind it.
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