Stablecoins and their use in decentralized finance (DeFi) have played a key role in the crypto bull market of 2021, allowing investors to participate in an increasing number of protocols that offer lucrative staking pools and facilitate the process of conducting transactions without the need to resort to a centralized exchange.
One project that has seen a significant amount of adoption thanks to its focus on creating a truly decentralized ecosystem and for offering asset-backed stablecoins is the DeFi protocol. Abracadabra.money and its native token SPELL.
Data from Cointelegraph Markets Pro and TradingView shows that, After hitting a low of $ 0.0114 on October 15, SPELL’s price rose 178.55% to set a new high of $ 0.035 on November 1, while its daily commercial volume shot up to USD 109.82 million.
Three reasons why SPELL is attracting the attention of DeFi users are the growth of Magic Internet Money (MIM) as a fully decentralized stablecoin capable of operating on various blockain networks, the many integrations that have expanded the reach of MIM and SPELL throughout the ecosystem and the governance and economy structure of the project token.
The growth of decentralized stablecoins
One of the biggest factors attracting the attention of active DeFi users is the stablecoin Magic Internet Money native to Abracadabra, which is fully backed and minted by depositing interest-bearing assets into the DeFi protocol coffers.
The growing popularity and adoption of MIM can be seen in the growing total value locked in Abracadabra, which reached a record high of $ 4.15 billion on November 1, according to data from Defi Llama.
There has also been steady growth in MIM’s outstanding supply, currently amounting to $ 1.93 billion according to data from CoinMarketCap. The most recent expansion is due, in large part, to the expansion of the assets that can be left as collateral to mint MIM, which now includes several of the more 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 investors are betting on SPELL is its expanding ecosystem, which has recently added support for multiple blockchain networks, including Fantom and the Binance Smart Chain (BSC).
BSC is the most recent addition to the Abracadabra ecosystem after the community voted to add support to the network in a vote that culminated on October 30.
 ™ ‚ï¸ ??!
A new governance proposal is out to decide whether we should deploy https://t.co/gHWEQJMoOc on #BSC!
The voting will last 2 days!
Make sure to cast you vote herehttps: //t.co/9QhH8kAaz8 pic.twitter.com/V47hDgKhI6
– â ™ ‚ï¸ ?? (@MIM_Spell) October 27, 2021
There is a new governance proposal to decide if we should implement.
The vote will last 2 days!
Other blockchain protocols currently supported by Abracadabra include Ethereum (ETH), Arbitrum and Avalanche (AVAX), and the platform also benefits from multiple inter-protocol associations, including integrations with Convex Finance (CVX), Yearn Finance (YFI), Curve Finance (CRV) and SushiSwap (SUSHI).
Favorable token economics and a shrinking circulating supply
Another factor that catches the attention of DeFi investors is SPELL’s tokenomics, which includes governance votes on emissions to control inflation.
The team responsible for SPELL regularly monitors the issuance schedule in the various DeFi pools in its ecosystem to ensure that new tokens are minted and used in the most beneficial way possible for the protocol and the holders.
Due to increased adoption and price hikes, a large number of tokens originally intended to be minted are no longer needed, so the team decided to reduce the issuance schedule by 20% on November 1.. Thus, 8.7 billion SPELL tokens have been removed from the current circulating supply.
 ™ ‚ï¸ ??!@ 0xM3rlin casted the “Incendio” spell!
8.7B $ SPELL have been burned!
Read more about the approved proposal
https://t.co/6sunolqzSa https://t.co/uGKm2kfYtv– â ™ ‚ï¸ ?? (@MIM_Spell) November 1, 2021
Merlin cast the “Incendio” spell!
8.7 billion SPELLs have been burned!
Looking ahead, the prospects for the project remain optimistic and the team also has plans to further integrate SPELL and MIM into the Fantom ecosystem, as well as offer new staking opportunities on Arbitrum and Avalanche.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Each investment and commercial movement involves risks, you must do your own research when making a decision.
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