Everything you need to know about SANTOS, Coin98 Wallet AMA with HashLand | 11 NFT Cards Airdrop, What is Polkadot (DOT)? Abracadabra Money is a cross-blockchain lending platform that allows users to earn money by using their interest-bearing assets. Abracadabra recognized that users with funds tied up in yield-farming pools wanted to borrow against those positions. For example, if an investor wants to take out a loan of 100, platform, they would need to put up at least $150 USD in, . This dynamic introduces new yield farming opportunities and provides the DeFi ecosystem with a more decentralized stablecoin thats engineered for cross-chain compatibility. POL allows protocols like Abracadabra to focus on delivering better products without having to worry about its liquidity seeping away. Of course, theres a risk that comes with that, namely the risk of liquidation, but its still a completely new way of market-making in the decentralized world.. If you rent liquidity from providers in exchange for SPELL bribes long enough, there will likely come a day when those providers find better rewards elsewhere. All rights reserved. The user then deposits their yvUSDC tokens as collateral to take out a loan on the Abracadabra platform. As a result, they have $900 worth of liquid MIM and are still earning a net 3.7% APY on their original deposit (4.5% APY on Yearn, minus the 0.8% interest charged for the loan on Abracadabra). Step 2: Deposit yvUSDT into Abracadabra Money as collateral. To explain these novel strategies, its worth examining how the Abracadabra crypto protocol integrates elements of conventional yield farming and collateralized stablecoins. Money earned is in the form of Magic Interest Money (MIM) tokens which are stable coins pegged to the US dollar. On most DeFi protocols, crypto loans are over-collateralized, meaning that the collateral value must always exceed the loan value. If you want to know further about Abracadabra Money (SPELL), please feel free to leave a comment below and join Coin98 Community for further discussions!

While there is a liquidation risk associated with this practice, it introduces an entirely new way of market making in the DeFi ecosystem. The protocols native governance token is called SPELL. The user could even continue leveraging his position up to 10 times with Abracadabras lending engine. SPELL holders can vote on proposals and receive platform fees by staking SPELL. The innovative approach that Abracadabra Money implements is to not only leverage the use of interest-bearing tokens, but also leverage the borrowing of them exponentially. Conversely, minting a conventional decentralized stablecoin like DAI requires depositing liquid assets like Ethereum or USDC as collateral to get liquid stablecoin tokens like DAI out.

The Abracadabra team replenishes the vaults when they run low. Once you have cvx3pool in your wallet, you can head over to Convexs Claim page to see that a new section has appeared which allows you to claim your CRV and CVX rewards just as if you had deposited your 3Crv tokens directly through Convex. Currently, you can track the price of SPELL on Coin98 Markets: https://markets.coin98.com/currencies/spell-token. , has strayed too far away from DeFis core values. pools as collateral to borrow or mint a U.S. dollar-pegged stablecoin called MIM. Abracadabra.Money is a lending protocol that lets users deposit interest-bearing assets to mint a multi-chain stablecoin called Magic Internet Money. The platform has no vested interest in one blockchain versus another. To understand Abracadabras economic moat, its worth looking at how regular yield farming and conventional decentralized stablecoins function today. Abracadabra.money is a decentralized crypto lending platform that allows users to collateralize digital assets in exchange for, loans. Abracadabras MIM token introduces a more decentralized stablecoin to the DeFi ecosystem, enabling new yield-generating opportunities. The platform gradually reduces the SPELL farming incentives, and dilutes the existing supply by adding permanent liquidity to the Abracadabra treasury. In a specific case, it allows users to use the interest-bearing tokens obtained from staking as collateral to obtain MIM. They deposit 1,000 USDC into a Yearn-USDC Vault, which generates a hypothetical 4.5% annual percentage yield (APY). He explains: To understand Abracadabras economic moat, its worth looking at how regular yield farming and conventional decentralized stablecoins function today. When a user deposits collateral to Abracadabra and takes out a MIM token loan, the platform mints fresh MIM into the supply, backed by the users ibTKNs in the Collateral Debt Position. Theres a 24-hour lock on sSPELL once you stake so make sure youre ready to lock your SPELL for at least one day before trying it out. Lets say a user wants to earn interest on $1,000 worth of USDC. On most DeFi protocols, crypto loans are over-collateralized, meaning that the collateral value must always exceed the loan value.

The innovative idea is that Abracadabra Money has brought interest-bearing tokens into use. Then you can select an independent risk tolerance for each asset, i.e., you can borrow less against the riskier asset. Again, were doing this with stablecoins, so its relatively safe, but still, proceed with caution. To do that, Squirrel says, Popsicle needed a separate but synergistic protocol like Abracadabra. Youll collect a portion of interest, borrowing, and liquidation fees collected by Abracadabra in proportion to the amount of sSPELL you own. Terra is a next-generation blockchain payment network interwoven with stablecoins and powered by its own LUNA coin.

Abracadabras main goal is to unlock what would have otherwise been stranded capital in DeFi to empower users to yield farm with leverage. The token emissions follow a ten-year halving model where SPELL rewards are cut in half every year. Decentralized Finance protocols have been shooting up in recent years. In our example, the cauldron for yvUSDC stipulates an interest cost of 0.8%, and users can borrow up to 90% of their collateral value.

sSPELL crypto holders automatically earn fees proportional to their share of the SPELL staking pool. Youve been through an article about Abracadabra Money and the SPELL token. They generate continuous returns, increasing in value the longer one holds them.

. Investors can exchange MIM for other stablecoins such as DAI, USDC, and USDT. Only click the deposit button. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. Follow @BitLift on Twitter, Instagram & TikTok and drop your email below for important announcements. For example, investors can sell or reinvest their loan proceeds, promoting more complex trading strategies. You can only obtain cvx3pool tokens by depositing directly through Abracadabra. Users do not have to worry about having sSPELL tokens. Squirrel believes that Abracadabras direct competitor, MakerDAO, has strayed too far away from DeFis core values. MIM is the only stablecoin that currently does that, says Squirrel. SPELL tokens to mint sSPELL, enabling fee-sharing in the SPELL staking pool and participation in the Abracadabra DAO. MIM has the same function similar to any other stablecoins. The lending platform allows users to create any isolated risk lending market they want, and with MIM being that multi-chain stablecoin, we can easily shift liquidity across ecosystems.. SPELL is the native governance and staking token of the platform. Contract address: 0x090185f2135308BaD17527004364eBcC2D37e5F6. Deposit USDC into Curves 3POOL in exchange for 3Crv LP tokens, Deposit the 3Crv tokens into Abracadabras cvx3Pool in exchange for cvx3Pool tokens. Further, the project team asserts that MIM is a better stablecoin because its not collateralized with centralized digital assets. By adjusting how much MIM you borrow against multiple forms of collateral, you decrease your liquidation risk in the event that volatility affects one of your collateral assets.

There are two main tokens in the Abracadabra Money ecosystem: Abracadabra Money provides isolated lending markets, which were first introduced by Kashi/Bentobox - a product of SushiSwap. Whats a DeFi platform to do? With standard yield farming, users typically deposit or stake liquid assets like USDT or SUSHI into yield farms like Yearn or. The steps are: The first step of opening up an LP position in Curves 3Pool is something weve done many times before. In addition, because those holding sSPELL or the SPELL/ETH Sushiswap LP token can participate in governance, staking SPELL doesnt have to mean forfeiting governance rights. Heres how it works.

Before, those tokens are left idle. Abracadabras roadmap plans include automating liquidations, creating more utility for MIM, and expanding across the entire DeFi universe. Lending Technology to provide isolated lending markets that enable users to adjust their risk tolerance according to the collateral they decide to use. . Abracadabra utilizes these collateral deposits to mint a USD-, stablecoin known as magic internet money on its. Therefore, protocols that facilitate lending and borrowing activities using cryptocurrencies have changed the face of finance. For him, the fight to keep DeFi, open, decentralized, and censorship-resistant has only just begun. 63% of the total money supply is allocated to the liquidity mining program. Prices in one country may differ from prices in other countries. Abracadabra is a lending protocol that operates cross-chains using a stable coin. Since interest-bearing tokens increase in value over time, the amount one can borrow keeps rising.

For example, a user picks a trading pair on the Popsicle automated market maker, say ETH/USDT, deposits the funds into the pool, and picks a leverage level. Currently, 853,879,084 SPELL are being emitted weekly, which consist of: Besides, 63% of the Total Supply used as incentives will be halved every year. Abracadabra provides both. Abracadabras governance happens through a snapshot page where sSPELL and SPELL/ETH Sushiswap liquidity provider token holders can make or vote on protocol improvement proposals. IDO: 7% (half on Uniswap v3 and half on Sushiswap). Heres the really cool thing about Abracadabra loans, regardless of which chain you use. Step 5: Adjust the gas fee, then click Approve. Abracadabra Money (SPELL) is a DeFi lending platform which allows anyone to convert interest-bearing cryptocurrencies into stablecoins called Magic Internet Money (MIM). 1Inch represents one of DeFi's leading decentralized exchanges, dominating with low fees and high liquidity. Conversely, when minting a conventional stablecoin like DAI, users deposit liquid assets like ETH or USDC as collateral and receive equally liquid DAI tokens. This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply. Instead, liquidations are currently handled manually by the team, which is far from being the most optimal or equitable process. However, its important to note that all sSPELL is subject to a 24-hour lock-up period, implemented to stabilize the staking pool. Composability allows protocols to click together like Lego pieces, creating new and increasingly efficient products for users. Popsicle Finance is a multi-chain yield optimization platform for liquidity providers built by the same experienced team behind Abracadabra. https://markets.coin98.com/currencies/spell-token, What is Cronos (CRO)? Incentivizing liquidity providers with SPELL tokens worked well to get the word out on Abracadabra and achieve deep multichain liquidity. The main purpose of SPELL is to facilitate liquidity on the Abracadabra Moneys lending markets. You can store SPELL & MIM token on Coin98 Wallet with these steps: Step 1: Open Coin98 Wallet & click Receive on the home screen. First, we see 1x leverage which is exactly the same as the borrow example we did earlier. A stablecoin known as magic internet money (MIM) underpins the Abracadabra crypto ecosystem, while the additional SPELL and sSPELL tokens facilitate governance and incentivize market participation. As you can see, this does not mean 10x leverage, this means looping through the process 10x using the loan-to-value ratio you selected above. But Ethereum liquidity providers arent getting all the SPELL. The SPELL token has a total supply of 210 billion coins, 63% of which are used to incentivize particular liquidity provider pairs or other liquidity mining programs to ensure deep liquidity for the projects markets. Danielesesta (Popsicle Finance, Abracadabra Money and WonderlandDAO). In other words, users deposit liquid tokens and receive liquid tokens. For example, behind the scenes, the protocol will: automatically exchange the loaned MIM tokens back to USDC; deposit USDC to the same Yearn Vault generating a 4.5% APY;, use the minted yvUSDT LP tokens to borrow more MIM on Abracadabra; and. These ibTKNs are becoming increasingly common throughout the decentralized finance (DeFi) space. Is Abracadabra Money (SPELL) a good investment? On the plus side, you get to keep the MIM you borrowed. Even though MIM stands for Magic Internet Money, theres more to MIM than mere sorcery. You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. Explaining the possibilities Abracadabra unfolds, Squirrel says: With Abracadabra, users can leverage up their yiled farming positions to earn more fees. These tokens are used to incentivize particular LP pairs and mining programs. Capital Efficiency is possibly the next target for protocols to work on, and Abracadabra Money has been doing a great job in this branch. SPELL is Abracadabra Moneys native token. Abracadabra has two tokens: MIM, the USD-pegged multichain stablecoin, and SPELL, the protocols utility and governance token used for fee-sharing and incentivization. One thing they could do is deposit 10,000 USDT into the Yearn USDT Vault, currently yielding around 2.1% net APY. The developers have used Ethereum blockchain to host the platform. Furthermore, SPELL can be staked in the Wizard Dashboard to obtain sSPELL tokens, used for fee-sharing in the SPELL staking pool and governance of the Abracadabra DAO. The user can now take these interest-bearing yvUSDT tokens and use them as collateral to take out a loan on Abracadabra. Its worth noting that this hypothetical example only refers to one source of collateral, highlighting how complex leveraged yield farming can become when utilizing Abracadabra.money. Simply click the deposit button to swap your 3Crv for cvx3Pool. The frog nation will win, Squirrel concludes. In conclusion, Abracadabra is an ambitious project building a superior product that is trying to fill what seems to be a real gap in the market-making and stablecoin corner of decentralized finance. This is where Abracadabras DeFi 2.0 credentials appear. The protocol was launched in May 2021. Before examining the unique features of Abracadabra.money, its important to revisit how collateralized stablecoin loans work. NFTs are crucial for the future of the Metaverse.

It is also bridged to other networks such as Fantom and Avalanche using AnySwap. The lending engine plays off synergies with other DeFi protocols to allow for some powerful yield farming strategies.

This is the price of 3Crv which Abracadabra will begin liquidating your position in order to keep your loan-to-value ratio in check. Yield farming usually involves depositing (staking) liquid assets like wETH or SUSHI into yield farms on platforms like Yearn.finance and SushiSwap. Abracadabra.Money is a lending protocol that allows users to deposit interest-bearing assets as collateral to borrow a stablecoin called Magic Internet Money that can be used across multiple blockchains. Each cauldron integrates a preset interest rate, collateral ratio, borrow fee, and liquidation fee. MIM is the only stablecoin that currently does that, says Squirrel. For example, investors can sell or reinvest their loan proceeds, promoting more complex trading strategies. DeFi lending protocols such as Compound and Aave mainly accept cryptocurrencies such as BTC, ETH, and stablecoins. Using sSPELL, you can start using voting rights. But issuing SPELL rewards dilutes the SPELL token and keeps the platform locked in battle against other DeFi upstarts with better rewards. The SPELL token facilitates governance on the Abracadabra crypto platform and has a. How is Abracadabra Money innovative? Abracadabras co-founder, who goes by the alias Squirrel, says the idea for the project was born out of the dire need for a decentralized stablecoin that is better than the current alternativesone that is truly decentralized, provides utility, and is primed for the multi-chain world. Olympus Pro bonds also use SPELL. To better understand Squirrels point, consider the following yield farming strategy. Discover 5 ways to earn passive income with crypto. Currently, the SPELL token serves only for governance purposes.

Once MIM is in your wallet, you can exchange it for other stablecoins or cryptocurrencies where MIM is accepted. To that end, building a community-driven project through decentralized governance is paramount for Abracadabra. Unfortunately at the time of writing this, there was only 1.39k of MIM available for borrowing so we snagged it while we still could! Through which users get to borrow Magic Internet Money (MIM), Abracadabras USD pegged stable coin. Before examining the unique features of Abracadabra.money, its important to revisit how collateralized stablecoin loans work. Be the first to put your crypto investments on autopilot with digital asset allocation that helps you safely and securely optimize your portfolio. In short, users deposit liquid tokens and withdraw illiquid tokens. When you repay the MIM, the protocol burns MIM from the supply, reducing its overall circulation in the market. is all about focusing on actually creating decentralized finance, and not this semi or quasi-decentralized finance, says Squirrel, arguing that other DeFi protocols have succumbed to VCs and institutions at the cost of decentralization and the broader community. But you better understand how it works before you deposit your valuable yvWETH into it. The Expected APY of 9.1209% is the APY were currently earning in CRV and CVX rewards through Convex. In other words, users deposit liquid tokens and receive liquid tokens. Get started.

That was a mistake. Its worth noting that this hypothetical example only refers to one source of collateral, highlighting how complex leveraged yield farming can become when utilizing Abracadabra.money.

Shrimpy helps thousands of crypto investors manage their entire portfolio in one place.

He explains: MIM aims to be the decentralized stablecoin for the multi-chain world. When that day arrives, Abracadabras total value locked will dwindle and due to the bottomless SPELL rewards, its token value evaporates. Each day Shrimpy executes over 200,000 automated trades on behalf of our investor community. Abracadabras main goal is to unlock what would have otherwise been stranded capital in DeFi to empower users to yield farm with leverage. Suppose a user wants to earn interest on $10,000 in. Pancakeswap users will probably prefer Abracadabra on BSC, while Trader Joe users will stick with Abracadabra on Avalanche. And The Olympus Pro program enables that security through a process called Bonding. Along with projects such as Olympus DAO and Convex Finance, Abracadabra represents the newest class of decentralized finance platforms: DeFi 2.0. Moreover, people holding interest-bearing tokens dont want to give up their yields while their tokens are locked as collateral. The stablecoin already runs on all decentralized exchanges across all blockchains, sidechains, and Layer 2 protocols. The user is earning 2.5% on the USDC they deposited to Yearn, has taken out a loan on Abracadabra that costs 0.8% a year, and holds MIM tokens representing 90% of their USDC value. Thats why Abracadabra teamed up with Olympus to deliver a new product. It sounds esoteric, but in reality, the idea is quite simple.

Protocol-owned liquidity, or POL means the deep liquidity it rents is under its permanent discretion. To better understand Squirrels point, consider the following yield farming strategy. Most recently, the team made a proposal to reduce the farming incentives by 20% and instead burn those SPELL tokens. Once the DAI loan is issued, its managed through a system called collateralized debt positions (CDPs), which are smart contracts that manage the ratio throughout the course of the loan. Suffice to say, unlike borrowing against a volatile asset like BTC or ETH, borrowing against stablecoins is relatively safe allowing for very high loan-to-value ratios. They generate continuous returns, increasing in value the longer one holds them. But instead, were going to deposit them into a magical Convex 3pool created by Abracadabra which allows you to borrow against those tokens while still harvesting rewards through Convex. But if we were to go through that entire process again, of depositing in Curve, Staking in Abracadabra, Borrowing MIM and Swapping for USDC ten times, we could expect to earn 32.5258% APY! With standard yield farming, users typically deposit or stake liquid assets like USDT or SUSHI into yield farms like Yearn or Sushi. Step 5: Deposit USDT into yEarn to receive yvUSDT (repeat Step 1). Everything you need to know about CRO Coin, What is Santos FC Fan Token (SANTOS)? or SUSHI into yield farms on platforms like Yearn.finance and SushiSwap. Abracadabra Money is a lending platform that uses interest-bearing tokens (ibTKNs) like yvWETH, yvUSDC, yvYFI, yvUSDT, xSUSHI, as collateral to borrow MIM (Magic Internet Money) which is a USD-pegged stablecoin. But at least were being up front about it? The lending engine plays off synergies with other DeFi protocols to allow for some powerful yield farming strategies. Using Abracadabra, users can make use of money their assets they own but are not using to generate money.

In the background, Abracadabra uses Sushis.

We saw an opportunity to create a stablecoin that is solely backed by interest-bearing assets, he says. Will you stake, lend, or yield farm to build your wealth? Abracadabra.money is a decentralized crypto lending platform that allows users to collateralize digital assets in exchange for stablecoin loans. This article will provide you with the answers to these questions.

The information provided on the Site is for informational purposes only, and it does not constitute an endorsement of any of the products and services discussed or investment, financial, or trading advice. You can stake SPELL tokens to receive sSPELL.

In total, 63% of the SPELL token supply is allocated to incentivize liquidity providers.

Proceed with caution. Don't wait until you are ready to take action. The protocol achieves this by allowing users to deposit interest-bearing assets such as Ethereum, USDT, or USDC deposited in Yearn.Finances pools as collateral to borrow or mint a U.S. dollar-pegged stablecoin called MIM. Liquidations on Abracadabra currently arent automatic, and users cant bid or compete to liquidate other borrowers collateral.

All rights reserved. Along with these protocols their use cases also seem to be on a quick rise. As a result, Abracadabra unlocks stranded capital in the DeFi ecosystem, opening up leveraged yield farming opportunities. Therefore, its a well-connected platform and this is how it provides cross-chain lending solutions to its users. Once the DAI loan is issued, its managed through a system called, , which are smart contracts that manage the ratio throughout the course of the loan. Now while your 3Crv rewards stack, you can also borrow MIM against them! It can be later swapped with any other traditional stable coin. Find out how tokenization and blockchains bring decentralization to new virtual worlds. This means the user earns 2.1% APY on their deposit, takes out a loan costing 0.8% of the year, and receives 90% of his original value in MIM. In this example, we staked 1,000 USDC which resulted in 981 3Crv because the value of 3Crv is slightly above $1 at $1.019. This enables the platform to provide isolated lending markets. Abracadabra Money is a DeFi lending platform. Abracadabra does the same thing with SPELL tokens.

within 10 minutes. It lets you deposit interest-bearing tokens from other protocols, such as Yearn Finance and Sushi as collateral in exchange for Magic Internet Money stablecoins. A supposedly decentralized stablecoin that is primarily collateralized by a centralized stablecoinits ridiculous.. To leverage yielding positions, there are 6 steps. As long as users control their collateral ratio and risk tolerance well enough, this model is extremely efficient, especially with the use of interest-bearing tokens. In general, DeFi protocols like Curve, Yearn, and SushiSwap mint ibTKNs as part of the loan structure. This article should give you a deep insight into the project, so there is no financial advice. SPELL is a governance token for the Abracadabra platform. He explains: If you think about it, to be a proper market maker, you need a reliable place where you can borrow, and a stablecoin thats available everywhere. When youre ready to get your collateral back, return the original MIM amount plus interest to unlock your tokens. Cryptopedia does not guarantee the reliability of the Site content and shall not be held liable for any errors, omissions, or inaccuracies. Its vision is to be the market maker of DeFia protocol that optimizes liquidity providing across all chains and decentralized exchanges. Whereas the DeFi 1.0 era depended on renting liquidity (i.e., rewarding yield farmers in exchange for liquidity), DeFi 2.0 emphasizes protocol-owned liquidity, or POL. As a result, a fully-leveraged $1,000 deposit could earn a yield on several thousand additional dollars, less the loan interest costs. MIM is an algorithmic stablecoin. Abracadabra Money has no Token Sale, so there is no investor. To dive deeper, MIM is actually a Decentralized Stablecoin.

Step 3: Select a leverage level (Ill take 4x as an example) and borrow the corresponding amount of MIM. At that point, they can cash out or stake the SPELL for additional gains. Your trusted source for all things crypto. That means that unlike most stablecoins on the market, MIM tokens can be easily transferred across a panoply of blockchains. as collateral and receive equally liquid DAI tokens. He explains: We want to introduce a pool where users can deposit funds, have that pool automatically liquidate certain positions based on signals, and then share the profits from the liquidation fees with the depositors..

By leveraging the AnySwap cross-chain protocol, users can currently transfer MIM from.