June 25, 2026, Magic Internet Money (MIM) lost more than 50% of its peg.
The first drop saw MIM fall to $0.74 in mid-June, rebound to $0.89, and then plunge to $0.49 on June 24. A pattern of partial recovery → deeper crash is a dangerous signal in DeFi.
Root causes:
Liquidity imbalance in the Curve Finance pool. An injection of $100,000 on June 15 and the distribution of 140 million SPELL tokens on June 18 failed to hold back selling pressure. Circulating MIM supply: ~ $104 million.
Emergency actions:
- Gradual interest rate increases across all Cauldrons (including deprecated markets)
- Stop Curve bribes and direct incentives until the peg recovers
- Logic: borrowers can buy discounted MIM in the market → repay a debt worth $1 → MIM is burned → supply shrinks
Macro context:
Bitcoin briefly fell below $60,000; cross-market crypto liquidations exceeded $994 million, worsening DeFi liquidity conditions overall.
Incident history:
- January 2024, smart contract exploit ($6.5 million).
- October 2025, logic flaw exploit ($1.8 million). Both came with a depeg. This is the third.
Structural risks:
MIM depends on DEX liquidity depth, not fiat reserves. When the Curve pool is thin, even small selling pressure can trigger a depeg spiral. The protocol itself acknowledges the gap between the theoretical peg and real market liquidity.
An investigation into the root cause is still ongoing. There is no end date for the emergency measures.
Source: CoinMarketCap, Abracadabra status page, PeckShieldAlert
$SPELL
$CRV
The first drop saw MIM fall to $0.74 in mid-June, rebound to $0.89, and then plunge to $0.49 on June 24. A pattern of partial recovery → deeper crash is a dangerous signal in DeFi.
Root causes:
Liquidity imbalance in the Curve Finance pool. An injection of $100,000 on June 15 and the distribution of 140 million SPELL tokens on June 18 failed to hold back selling pressure. Circulating MIM supply: ~ $104 million.
Emergency actions:
- Gradual interest rate increases across all Cauldrons (including deprecated markets)
- Stop Curve bribes and direct incentives until the peg recovers
- Logic: borrowers can buy discounted MIM in the market → repay a debt worth $1 → MIM is burned → supply shrinks
Macro context:
Bitcoin briefly fell below $60,000; cross-market crypto liquidations exceeded $994 million, worsening DeFi liquidity conditions overall.
Incident history:
- January 2024, smart contract exploit ($6.5 million).
- October 2025, logic flaw exploit ($1.8 million). Both came with a depeg. This is the third.
Structural risks:
MIM depends on DEX liquidity depth, not fiat reserves. When the Curve pool is thin, even small selling pressure can trigger a depeg spiral. The protocol itself acknowledges the gap between the theoretical peg and real market liquidity.
An investigation into the root cause is still ongoing. There is no end date for the emergency measures.
Source: CoinMarketCap, Abracadabra status page, PeckShieldAlert
$SPELL
$CRV