Nikolas Sargeant
MANTRA's leadership denied manipulation allegations following OM token's sudden collapse, attributing the crash to "reckless liquidations" during low-liquidity trading hours.
The native token of blockchain project MANTRA experienced a catastrophic 90% price drop in just 24 hours, raising serious questions about real-world asset tokenization platforms and their stability.
On April 13, OM token plummeted from approximately $6.30 to under $0.50, wiping out over $6 billion in market capitalization. The dramatic collapse occurred during weekend trading when markets typically see lower volume, magnifying its impact across decentralized finance ecosystems.
The incident prompted immediate comparisons to previous crypto market disasters like Terra's LUNA collapse and the FTX implosion, with some traders labeling it a potential "rug pull."
MANTRA CEO Blames Forced Liquidations During Off-Hours Trading
Social media user Gordon suggested on X that the MANTRA team may have controlled a substantial portion of the token supply before "selling everything." He described it as the most significant rug pull since LUNA and FTX, warning that OM could potentially "head to zero" without decisive team action.
MANTRA's leadership firmly rejected allegations of insider trading or deliberate misconduct. In an official statement, the project claimed the crash resulted from "reckless liquidations" while maintaining that the protocol's fundamental structure remains sound. "Today's activity was triggered by reckless liquidations, not anything to do with the project," the team announced on X.
JP Mullin, MANTRA's CEO and co-founder, elaborated that a major OM holder faced forced liquidation on a centralized exchange, triggering cascading sell orders. He noted these liquidations happened without adequate notice during low-liquidity Asian trading hours, suggesting possible exchange negligence or deliberate market manipulation.
Mullin emphasized that the sell-off didn't involve MANTRA's core team, foundation, advisors, or early investors. "This dislocation was not caused by the team, the MANTRA Chain Association, its core advisors, or MANTRA's investors selling tokens," he stated on X.
Token Structure Under Investigation Following Market Collapse
Crypto commentator Ran Neuner questioned the classic rug pull narrative: "I'm not telling anyone to buy but if it's not a rug, this is not a natural dump," suggesting deeper structural issues may exist.
MANTRA, a permissionless Layer 1 blockchain focused on real-world asset tokenization, had previously attracted investors seeking exposure to tokenized real estate and infrastructure. However, the recent collapse raises serious doubts about its future and highlights concerns regarding projects with concentrated token supply and centralized liquidity dependence.
Binance reported on X that their preliminary analysis points to cross-exchange liquidations as the likely cause. The exchange also noted it has displayed warning alerts about major changes to OM's tokenomics since January, including significant supply increases.
As OM continues trading near multi-month lows, MANTRA has promised a comprehensive post-mortem report while traders await further clarification.
