LUNA brings down another Altcoin: the price melts!

LUNA brings down another Altcoin: the price melts!

Magic Internet Money (MIM), a USD-pegged stablecoin from the Abracadabra ecosystem, joined the ranks of tokens that lost their $1 stablecoin during an unpredictable crypto winter. The sudden detachment of the MIM token started last night. Then, the price of the token fell to $0.926 in just three hours. It is believed that behind this event lies the death spiral in the Terra (LUNA) ecosystem. Here are the details…

Algorithmic Stablecoin MIM Falls After Terra’s UST (LUNA)

The death spiral of Terra LUNA and TerraUSD (UST) has not only affected investors. It has also had a negative impact on many crypto projects, including Abracadabra’s MIM token, as claimed by the “AutismCapital” Twitter account. Based on inside information, AutismCapital claimed that Abracadabra incurred $12 million in debt as a direct result of Terra’s sudden downfall. According to the user, “the purges did not happen quickly enough to meet the protocol’s MIM obligations.”

Abracadabra has more money in its treasury than debt. CRV is valuable for the protocol.

Algorithmic stablecoins lose value

Reiterating his stance, Sestagalli publicly shared his Treasury address with $12 million in assets. He asked interested investors to verify the same using on-chain data. On the other hand, Autism Capital claimed that Sestagalli’s questionable debt was created five days ago. He shared the screenshot below showing MIM talking in his Discord group.

The risk of bankruptcy persists as MIM’s cash position continues to depreciate. At the same time, the creation of more debt continues to threaten the Abracadabra protocol. For this reason, investors should follow market fluctuations before making investment decisions. Investors are advised to do their own research. Meanwhile, As we also reported, an unpeg event occurred in another stablecoin. De-peg means that the stablecoin leaves its stablecoin in a ratio of 1:1. Five days ago, on June 13, the price of the USDD stablecoin protocol fell to $0.97 on major crypto exchanges.

Tron DAO Reserve announced that it received 700 million USD coins (USDC) to defend the USDD stable to help it during market fluctuations. Following the injection of funds, the team behind the stablecoin announced that the USDD collateralization rate had now increased to 300%. Regardless of the overall crypto decline, these moves towards USDD have had a negative impact on the value of TRON (TRX).

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