Do You Believe In Magic?
A Deep Dive Into Abracadabra
I’ve been saying for weeks that DeFi season is on its way back to the forefront. We’ve seen proof of that with L1 pumps we’ve been seeing with projects like Avalanche, Fantom, Cosmos, Terra, etc. Today we aren’t going to focus on any L1s. There’s something brewing in crypto land, and today we’re going to get to the bottom of it. What if I told you that efficient cross chain lending and borrowing may actually be possible?
That’s right. We’re getting closer to achieving a full fledged, robust DeFi economy. So, have I peaked your interest yet? If so, strap in and get ready to take a ride down the magical rabbit hole of Abracadabra, to grab a Popsicle, while on our way to Wonderland.
What Is Abracadabra?
Abracadabra describes itself as a spell book that allows users to produce Magic Internet Money aka $MIM.
For a more transparent description:
As we can see, Abracadabra is the platform that allows users to borrow the stablecoin MIM. In addition to borrowing, users can also farm, stake, provide liquidity to the MIM-3Pool, and perform swaps.
Now, the cool thing about providing liquidity and performing swaps is that it all takes place through Curve Finance.
Let’s talk about farming and staking. Abracadabra allows users to stake their LP tokens to farm a token called SPELL. The SPELL token will act as the governance token that will allow holders to vote on future incentivization programs for LP pairs once the governance portal goes live.
Tetranode has no problem expressing his bullish sentiments surrounding SPELL;
The most interesting aspect of Abracadabra is the bridging capability through Anyswap.
As you can see from the collaboration with Curve and Fantom (Anyswap), Abracadabra is developing relationships with multiple platforms.
As bullish as this is, we have one final piece of evidence to present that shows proof that cross chain capital efficiency is on the way.
Earlier this week Arbitrum’s $NYAN LP ended, and there was no clear direction of where the TVL would be transferred to. That’s when Daniele Sestaylor – from MIM and Popsicle – decided to step in and deliver a solution.
He quickly set up a MIM pool in addition to providing stakers with a $1M airdrop in SPELL tokens.
αlex 2.1 | αlex and Ωmega @alexandomegaI deposit $ETH on https://t.co/KuAqgbCN7N on #Arbitrum (and become eligible for a $1M airdrop), borrow the decentralized stable coin $MIM & send those $MIM from #Arbitrum to $FTM in just 5 minutes via @AnyswapNetwork & @MIM_Spell 👀 This is the magic of $SPELL 🪄 https://t.co/PSVrKzvOex
Daniele and his team are creating true magic on the blockchain…..but wait! There’s more…...
Which brings us to Popsicle.
Popsicle is a multichain yield optimization platform for stakers.
Popsicle’s vision is to create access to liquidity throughout the entire crypto ecosystem all from one hub.
Popsicle offers four different products that each serves a specific purpose for customers’ liquidity needs. The token that is attached to Popsicle is known as ICE.
Daniele gives us the rundown on how Popsicle will be supported by Abracadabra in the tweet below.
Now, one thing to note is that Popsicle did suffer a hack back at the beginning of August. However, the team responded tactfully and offered excellent solutions to compensate any victims.
Unfortunately hacks seem to be a right of passage in these early days of DeFi. The important takeaway is that the team rectified the situation immediately.
This is all very complex, but hopefully the puzzle pieces are starting to come together for you all.
Lastly, let’s talk about Wonderland.
Customers can use the Wonderland platform to either stake or bond their tokens. Stakers stake their TIME tokens in return for more TIME tokens, while bonders provide LP tokens or MIM tokens in exchange for discounted TIME tokens after a fixed vesting period.
Wonderland aims to become another solution to securing and growing MIM tokens.
People are buying in, due to the success of OHM – seeing as how Wonderland is a fork of Olympus Dao. However, there have been a few recent developments that make us a little uneasy. Proceed with plenty of caution when investing in this token.
Another thing to note is that Wonderland is not a product of the MIM team, and the founders are anon. We aren’t particularly bullish on anon founders. So, again we stress that you proceed with caution when using this product.
The Abracadabra and Popsicle team are creating something truly monumental.
Cross chain lending and borrowing has been both a huge pain point and a huge opportunity for whoever solves the puzzle.
It’s the type of problem that some would say could only be fixed by some kind of Magical Internet Money…..and to that we say, Abracadabra!
Squirrel of Valhalla from the team summed their mission up perfectly in the tweet below.
Brian Armstrong @brian_armstrongIf fiat backed stablecoins really become inflation coins (not so stable), then how will we get a coin that is truly stable? Perhaps something that tracks a basket of real world goods (purchasing power parity) using oracles? Ideas welcome.