What is Spell Token (SPELL)?
Spell Token (SPELL) is the native token of the Abracadabra stablecoin lending platform. It’s one of several assets available on the network, alongside MIM and MIG. Spell is used for incentivization and staking. It was developed using the ERC-20 token standard.
Abracadabra (stylized as abracadabra) is a multichain decentralized lending service for stablecoins. It’s available on Ethereum, Avalanche, Arbitrum, and Fantom. The current SPELL price and market capitalization are available above.
Who created Spell Token?
Abracadabra was co-founded by Daniele Sesta and Squirrel. Squirrel is a pseudonym, thus, the true identity of Squirrel is completely unknown. Sesta’s biography is also relatively unknown. Before getting started on the Abracadabra crypto platform, Sesta has previously been involved with various blockchain projects.
Abracadabra serves as a direct competitor to MakerDAO. It offers decentralized stablecoin lending services using its tokens MIM and MIG, which are pegged to the value of USD. SPELL serves as the platform’s staking token which provides rewards and incentives to continue network contributions.
The Abracadabra platform launched in May 2021. The Spell Token price volatility is relatively low, making it an attractive token for the users to stake. Throughout its first year in the market, the Spell Token has shown tendency to follow the overall market trends. This was particularly notable in November 2021.
The asset was also impacted by the crypto market crash in Q2 2022. A year after its launch, in May 2022, the recorded SPELL price was less than a cent, fluctuating between $0.003 and $0.005.
What Are the Features of Spell Token?
The supply of Spell tokens was initially 420 billion. However, it has since been reduced to 210 billion after a unique burning event was performed. 63% of the token supply has been allocated to global farming incentives. The rewards are halved once every ten years. SPELL has a deflationary nature, which means that the Spell Token price is expected to rise over time.
Unlike MIM and MIG, this asset is not a stablecoin. Therefore, the SPELL price can frequently change based on the exchange rate and market conditions.
SPELL is primarily used to provide liquidity and stake on the platform. By injecting liquidity, users are eligible to earn rewards that incentivize them to continue their contributions. By staking SPELL, you are able to claim sSPELL tokens, which can also be used for the protocol's governance.
Although Abracadabra does not function as a DAO, sSPELL and SPELL token holders can participate in the governance process. Users can propose protocol changes and vote on them using their tokens. The governance model ensures network decentralization.
