Mantra Token Plummets 90%: Exchange Liquidations Cited for Market Cap Reduction
By Yousra Anwar Ahmed
In a shocking downturn for the cryptocurrency community, Mantra’s OM token experienced a staggering 90% decline within hours on Sunday, leading to a dramatic decrease in its market capitalization from nearly $6 billion to approximately $683 million. The token’s price crashed from around $6.30 to around $0.70, prompting widespread concern among investors.
OKX Exchange Issues Statement on Price Collapse
Reacting to the unexpected plunge, major cryptocurrency exchange OKX issued a formal statement outlining the events surrounding the OM token’s failure. The exchange reported that the significant price drop was first detected at approximately 2:28 am UTC+8 on April 14. Initial indicators of risk, including a rapid price decline and increased trading volume, originated from other exchanges before a broader market collapse ensued.
OKX highlighted potential structural issues with the token, referencing significant changes to the project’s economic model since October 2024. The analysis indicated that large deposits and withdrawals had occurred from several addresses across various exchanges since early March, raising concerns about the implications on liquidity and price stability.
As a precaution, OKX adjusted several risk control parameters and implemented risk warnings specific to the OM token, citing heightened market risks that could lead to considerable price fluctuations.
Forced Liquidations Blamed
John Patrick Mullin, co-founder of Mantra, addressed the crisis through the project’s official communication channels. He attributed the steep decline primarily to "reckless forced closures" executed by centralized exchanges against OM token holders. Mullin expressed that the abrupt nature of the price drop suggested a lack of adequate warning or notice to investors, indicating possible negligence or even intentional market manipulation by centralized entities.
Data from Coinglass corroborated Mullin’s position, revealing that the crash prompted over $74.7 million in liquidations across various trading positions, with numerous accounts facing liquidations exceeding $1 million each.
Team Denies "Rug Pull" Allegations
Amidst the turmoil, speculation circulated regarding a possible "rug pull," a scenario where developers abandon a cryptocurrency project after draining funds. Some traders voiced fears that the project could mirror previous catastrophic events in the crypto space, leading to FTX or Terra’s downfall.
In response to these allegations, the Mantra team firmly rejected claims of wrongdoing. Mullin posted verification addresses for the team’s token holdings, reassuring the community that their assets remain locked in compliance with previously established vesting schedules. He clarified that the collapse was not the result of any actions taken by the team or affiliated parties.
Arkham Intelligence noted that approximately 21 million OM tokens had been burned in separate transactions earlier in April, although this had no connection to the current crisis facing the token.
As the dust settles, the cryptocurrency community continues to monitor the situation closely, with investors urged to perform due diligence before engaging in future trading activities, particularly as the market showcases increased volatility and risk.
This article aims to provide an overview of recent developments concerning the Mantra OM token and is intended for informational purposes only. Readers should conduct thorough research before making any investment decisions.
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