when

Tornado

The decentralized platform Abracadabra.money witnessed a significant setback as its stablecoin, MIM, experienced a flash crash, plummeting to $0.76. The crash was triggered by reports of a $6.5 million exploit, with blockchain security firm PeckShield shedding light on the details at 11:35 UTC on Tuesday. Notably, the attacker received funding from Tornado Cash, a sanctioned privacy protocol.
The initial loss for What caused the MIM crash? 
Cetrik, a prominent figure in the <a href="https://news.todayq.com/mike-johnson-elected-speaker-of-the-house-crypto-community-awaits-for-his-stance/" target="_blank" rel="noopener noreferrer nofollow">crypto community</a>, indicated that early findings suggest a rounding error as the root cause of the exploit. This unforeseen incident prompted swift action from MIM developers, who announced that the Abracadabra DAO would initiate a buyback of the stablecoin, originally designed to maintain a $1 peg. At the time of the announcement, the stablecoin was trading around $0.94, according to CoinMarketCap.
“We are aware of an exploit involving certain cauldrons on Ethereum,” stated MIM on X. “Our engineering team is triaging and investigating the situation. To the best of its ability, the DAO treasury will be buying back MIM from the market to then burn. More updates are coming.”
This is not the first time MIM has faced volatility, as it experienced fluctuations in 2022 during the collapse of <a href="https://news.todayq.com/ftxs-ftt-is-up-while-bitcoin-is-down-heres-why/" target="_blank" rel="noopener noreferrer nofollow">FTX</a>. A third of MIM’s collateral was tied to FTT, FTX’s native token. As FTT experienced a downturn, MIM temporarily fell to $0.95 before recovering to parity. The previous exploit 
The project drew attention earlier this year when a proposal was made to shift power from the decentralized Abracadabra DAO to a centralized entity involving lawyers and trustees. This move raised concerns within the crypto community about the project’s commitment to decentralization. MIM is currently valued at $0.9802, reflecting a 2.11% increase in the last 24 hours.
When people heard about the sudden drop in MIM’s value, those interested in crypto felt a bit worried and curious about how secure decentralized platforms are and how stablecoins work. MIM’s choice to buy back and get rid of its stablecoin after the problem shows they are serious about keeping its value steady and making sure users don’t get hurt too much.
Transitioning to the background of the project, MIM’s reliance on FTX’s native token as collateral became a focal point during the 2022 FTX collapse. The aftermath of this incident led to a temporary dip in MIM’s value, highlighting the interconnected nature of various assets within the crypto space.
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MIM stablecoin struggles with depegging after $6.5M exploit

Todayq News

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