Mantra (OM) Plummets by 90%, CEO Blames Forced CEX Liquidations

Mantra (OM), a layer-1 blockchain for real-world assets (RWAs), made headlines over the past few hours following the catastrophic crash of its native cryptocurrency. On-chain data shows that the digital asset plunged by 90% from over $6 to around $0.7 at press time. This price downtrend wiped $5.5 billion in market valuation within hours.

Shortly after the exploit, Mantra’s CEO John Patrick Mullin shared an X post addressing the incident. He blamed “reckless forced closures initiated by centralized exchanges on OM account holders” for the market crash. However, his claims did not sit well with many in the crypto community.

What Happened?

Mantra’s woes began when a wallet possibly linked to the project’s team deposited 3.9 million OM tokens into the centralized exchange OKX. Another on-chain study showed that 17 wallets deposited 43.6 million OM into crypto exchanges. This represented 4.5% of the asset’s circulating supply. Two of these wallets likely belong to Laser Digital, a strategic investor in Mantra since May 2024.

These transactions attracted the attention of various crypto users. This was especially because the Mantra team retains about 90% of the cryptocurrency’s total supply of approximately 1.8 billion units.

Max Brown, an on-chain expert, stressed that over-the-counter (OTC) deals caused the sudden price downtrend. He explained that all OTC whales’ holdings suffered losses as OM’s price tanked by half. Panic selling ensued, causing a further price downtrend to OM’s current lows.

Mantra’s latest crash is a typical example of what happens during oversized withdrawal volumes. Mullin explained that Mantra and its team are not behind the price crash and blamed CEXs. He added that “the timing and depth of the crash suggest that a very sudden closure of account positions was initiated without sufficient warning or notice.”

OKX’s Star Xu Slams Back

OKX’s founder, Star Xu, refuted Mullin’s claim and called it “a big scandal.” He explained that the liquidation data of all major centralized exchanges is accessible on-chain and that this data can be investigated. The OKX founder also explained that he would make all the necessary reports available whenever needed.

Meanwhile, other crypto users are unsatisfied with Mullin’s explanation, requesting in-depth details of the incident.

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