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- A recent hack on gmCauldrons led to a $13 million loss.
- Abracadabra DAO has repurchased 50% of the lost funds.
- Full recovery is expected by mid-2025.
Abracadabra’s gmCauldrons suffered a major exploit, leading to a loss of 13 million MIM, valued at around 6,000 ETH. The rest of the protocol remained safe. The team acted quickly, using the DAO treasury to buy back 6.5 million MIM, covering half of the total loss. The remaining funds will be recovered over the coming months.
The gmCauldrons were at the heart of the Abracadabra ecosystem, offering users the functionality to collateralize gmTokens to borrow MIM. They had gone through a number of audits for security before they were released and were being monitored by threat detection systems.
Despite these measures, the system was compromised by an attacker. The attack was tracked by the team, but one of the security systems failed to send timely alerts. The DAO confirmed to users that no personal funds had been stolen. The team is finishing a technical report, which will be released soon.
Treasury Secures Market Confidence
Abracadabra remains in a sound financial situation after the incident. The DAO treasury holds around $19 million worth of assets. The MIM peg was also strong during the crisis and experienced only minor deviations. In another bid to calm the market further, the team utilized treasury funds to buy back the stolen MIM.
The first 50% of the lost value was restored within 48 hours. The remaining half will be filled in stages, with minimal market disruption. A staged process will be carried out to restore stability while protecting liquidity providers and investors.
The DAO also funded other Depeg Contingency Funds. The funds will be tapped using governance proposals with transparency on fund usage. The team remains committed to protecting the users and protocol integrity.
Nibiru to Get MIMswap & Lending Options
New deployments on Berachain, Nibiru, and PurrSwap will continue to empower the ecosystem. They will introduce more liquidity and new opportunities to users. Berachain will also bring cauldrons, which will enable users to mint MIM with various LP tokens. The SPELL emissions will go to liquidity pools, which will further enhance the utility of the protocol. Omnichain SPELL, based on the OFT v2 standard, will also increase cross-chain liquidity. Nibiru will receive MIMswap, a new stable swap feature, and additional lending capabilities. These will place Abracadabra at the forefront of Nibiru’s burgeoning ecosystem.
Purrswap, a new stable swap protocol, is launching as well. SPELL holders are also going to get an airdrop as a reward as part of the launch. The project will be closely integrated with HyperLiquid, with more liquidity and price efficiency. Abracadabra remains dedicated to long-term stability and growth despite the recent attack. It will be fully restored by mid-2025 as it gets rolled out to more markets.
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