What is Abracadabra.money (SPELL)? Overview of potential SPELL token project

What is Abracadabra.Money (SPELL)?

Abracadabra. money is a protocol that helps users improve capital efficiency from assets locked in vaults. Abracadabra. money will assist users to provide liquidity on the platform to increase profits from features such as farming, borrowing, staking, swap, and bridge support for your convenience in trading.

How Abracadabra.money works?

Abracadabra’s operating mechanism is similar to other mortgage lending platforms such as MakerDAO, Aave, Synthetix… DeFi lending protocols only accept cryptocurrencies like BTC, ETH… instead of interest tokens, interest rates as collateral, interest tokens are generated by users when they stake their respective assets on yield farming platforms like Yearn Finance, Curve, or Sushi to receive interest. Some popular interest rate tokens can be mentioned as yvWETH, yvUSDC, yvYFI, xSUSHI… However, these tokens cannot be traded on exchanges.

Recognizing user demand and the potential of interest tokens, Abracadabra’s development team built and developed a platform that allows users to use interest tokens to collateralize and borrow stablecoins. MIM. With interest tokens from stablecoins, after mortgaging users can borrow up to 90% of the value of their staked assets.

By doing this, Abracadabra has opened up the opportunity to free up capital trapped in yield farming platforms to help investors optimize profits as well as turn illiquid assets into liquid.

Abracadabra.money loan process

Abracadabra uses BentoBox’s Kashi platform to provide its unique lending marketplace. This allows users to adjust their risk tolerance according to the collateral they want to use. The process of borrowing money on Abracadabra is summarized through the following 4 steps:

Deposit assets to lending and staking platforms to receive interest tokens
Deposit interest tokens to Abracadabra.money as collateral
Choose the leverage level and borrow the desired amount of MIM
Exchange MIM for another stablecoin way to continue investing.

When returning the MIM, the platform will burn the MIM from circulation and return the assets to the user.

Development roadmap of Abracadabra.money

Since its launch in May 2021, the Abracadabra development team has not released any information regarding the project’s development roadmap. However, with Abracadabra, the project development team shared that they want to focus on building and developing MIM so that it can compete with other decentralized stablecoins such as DAI and UST, thereby competing with other decentralized stablecoins. Current centralized stablecoins like USDT, USDC, BUSD…

Abracadabra.money developer team and investors

The project has not yet made official announcements about its development team as well as its investors. Many believe that the Twitter user account Daniele is one of the founders of Abracadabra.

General information about SPELL token

SPELL is the official token of Abracadabra and is used to incentivize users to maintain the market liquidity of the platform. SPELL is issued according to the ERC-20 standard with a maximum total supply of 420 billion tokens. The project then conducted a token burn to reduce this number in half to 210 billion SPELL.

Basic information about SPELL token

Token Name: Spell Token
Ticker: SPELL
Blockchain: Ethereum
Token Standard: ERC-20
Contract: 0x090185…37e5F6
Token Type: Utility
Total Supply: 210,000,000,000 SPELL
Circulating Supply: 86,461,368,384 SPELL

SPELL token distribution

Global Farming Incentives: 63% (132.3 billion SPELL)
Team: 30% (63 billion SPELL)
IDO: 7% (14.7 billion SPELL)

SPELL token allocation schedule

Global Farming Incentives (132.3 billion SPELL): This amount of tokens will be used as a reward to incentivize investors to provide liquidity to the platform. According to the project’s calculation, every week there will be 343,907,315 SPELL rewarded to users.
IDO (14.7 billion SPELL): All of these tokens were distributed through IDO, half on Uniswap and half on SushiSwap.
Team (63 billion SPELL): This amount of tokens are distributed gradually over 4 years to members of the founding team. 50% for the first year, 25% for the 2nd year, and 12.5% for the remaining 2 years.

SPELL token exchange and storage wallet

In addition to Ethereum, through Abracadabra’s bridge, investors can trade SPELL on many different blockchain platforms such as Fantom, Avalanche, BNB Chain… Users can buy, sell and trade SPELL tokens on popular exchanges. variables like Binance, Coinbase, FTX, Uniswap, SushiSwap, SpiritSwap, Trader Joe…

SPELL was originally issued under the ERC-20 standard but was later developed into a multi-chain token. Therefore, you can safely store SPELL on many e-wallets such as MetaMask, SafePal, Math Wallet, and Trust Wallet….

Should I invest in Abracadabra and SPELL tokens?

With Abracadabra.money, users can leverage their yield farming DeFi positions to maximize profits. Despite the risk of loan liquidation, Abracadabra has brought a completely new product and market to the DeFi ecosystem. The recent combination of Terra and Abracadabra further increases the attractiveness and profitability of the platform.

For example, you deposit your UST at Anchor Protocol with an interest rate of 20%/year. You can completely raise this interest rate even higher, even 100% through interest tokens paid from Anchor Protocol and put them into Abracadabra’s MIM loan. In particular, this unbelievable interest rate comes from stablecoins, much higher than traditional bank rates.

In addition to participating in providing liquidity to Abracadabra to receive SPELL weekly. Investors can also stake SPELL to receive sSPELL. When owning sSPELL, investors can receive a part of the interest from the loan fee, the liquidation fee that Abracadabra collects in proportion to the amount of sSPELL they own. Abracadabra also pledged that 75% of the revenue from the protocol will be used to buy back SPELL tokens on the secondary markets, the remaining 25% will be used to build a treasury to secure the long-term future of the project.

Risks when participating in using products and services of Abracadabra.money

As with all borrowing and lending platforms in decentralized finance (DeFi), asset liquidation can happen to anyone. When the value of the collateral falls below a specified point, usually when the collateral is insufficient to repay the loan, liquidation of the property occurs. Liquidation limits are displayed as soon as the user opens debt positions on the Abracadabra.money platform. If a user uses interest tokens that represent volatile assets such as SUSHI, YFI, or ETH, their loan position may drop below liquidation in the event of strong market movements.

In addition, the risks of using Abracadabra.money are the same as with other DeFi applications. The project works through the use of smart contracts. Although smart contracts are arguably one of the most important components for decentralized applications, hackers can still exploit security vulnerabilities from smart contracts to attack funds. produce.