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3 reasons why DeFi users are bullish on Abracadabra, Magic Internet Money and SPELL

November 5, 2021No Comments

Stablecoins and their use in decentralized finance (DeFi) have played a key role in the cryptocurrency bull market of 2021 because they allow investors to participate in the increasing number of protocols that offer high-yield betting pools and facilitate the process of transaction without the need to do so. use a centralized exchange.

One project that has seen significant adoption thanks to its focus on creating a truly decentralized ecosystem and asset-backed stablecoin is the Abracadabra.money DeFi protocol and its native SPELL token.

Data of Cointelegraph Markets Pro and TradingView shows that after hitting a low of $ 0.0114 on Oct 15, SPELL's price rallied 178.55% to set a new high at $ 0.035 on Nov 1 as its 24-hour trading volume shot up to $ 109.82 millions.

SPELL / USD 4-hour chart. Source: TradingView

Three reasons why SPELL is attracting the attention of DeFi users are the growth of Magic Internet Money (MIM) as a fully decentralized, cross-chain-capable stablecoin, numerous cross-chain integrations that have expanded MIM's reach. and SPELL across the ecosystem and token governance and tokenomic structure.

Decentralized growth of stablecoins

One of the biggest factors attracting the attention of active DeFi users is Abracadabra's native Magic Internet Money stablecoin, which is fully guaranteed and minted by depositing interest-bearing assets in the DeFi protocol.

The growing popularity and adoption of MIM can be seen in the growing total value locked in Abracadabra, which reached a record $ 4.15 billion on November 1 according to data from Defi Llama.

Total value locked in Abracadabra.money. Source: Defi Llama

There has also been a steady growth in the circulating supply of MIM, which stands at $ 1.933 billion according to data from CoinMarketCap. The most recent expansion is largely due to the expansion of assets that can be pledged as collateral to mint MIM, which now includes popular tokens such as Shiba Inu (SHIB), FTX Token (FTT), wrapped Olympus (OHM), and Fantom ( FTM).

Cross-chain integrations expand SPELL's reach

A second reason why inv is taking a closer look at SPELL is its expanding ecosystem, which recently added cross-chain support for multiple blockchain networks, including Fantom and Binance Smart Chain (BSC).

BSC is the most recent addition to the Abracadabra ecosystem after the community voted to add support for the network in a vote that closed on October 30.

Other blockchain protocols currently supported by Abracadabra include Ethereum (ETH), Arbitrum and Avalanche (AVAX), and the platform also benefits from multiple inter-protocol partnerships including integrations with Convex Finance (CVX), Yearn Finance (YFI), Curve Finance (CRV), and SushiSwap (SUSHI).

Related: Magic Internet Money Surpasses $ 1 Billion, Points to MakerDao

Favorable tokenomics and a decreasing circulating supply

Another factor that catches the attention of DeFi investors is SPELL's token structure, which includes governance votes on issues to control inflation.

The team behind SPELL regularly monitors the issuance schedule across the various DeFi pools in its ecosystem to ensure that new tokens are minted and used in the most beneficial way for the protocol and holders.

Due to the growing adoption and price increase, a large number of tokens originally scheduled to be minted are no longer needed, so the team decided to decrease the issuance schedule by 20% as of November 1. . This effectively wiped out 8.7 billion SPELL tokens. current circulating supply.

Moving forward, the project outlook remains optimistic and the team also has plans to further integrate SPELL and MIM into the Fantom ecosystem and also offer new opportunities for participation in Arbitrum and Avalanche.

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